Millions of federal and state government and military retirees covered by Medicare would be forced to pay much higher premiums -- for benefits that most already receive -- under congressional plans to improve catastrophic health insurance protection for all the nation's elderly and disabled.
The House has already passed such a plan. The Senate will consider a slightly different bill when it returns next month. Both would beef up catastrophic illness coverage for all elderly residents as part of Medicare. In addition to a standard premium increase for all beneficiaries, the plans call for a new supplemental premium for Medicare beneficiaries based on their taxable income.
Although the formulas to determine the premium in the Senate and House differ, any retiree over the age of 65 with taxable income will be charged a higher premium under the plans. Social Security benefits, which are largely tax-free, would not be counted as income in the House-passed bill. The Senate plan would base the income-related premiums on the amount of tax an individual actually owes.
Because most federal workers and retirees belong to health plans that already provide catastrophic illness coverage and because their pensions are fully or partially taxed, most would be required to pay higher premiums under either plan for benefits that they already get as part of their government health insurance plans.
The National Association of Retired Federal Employees says that the typical federal retiree (with an average annuity of $13,566 a year) would have to pay about $530 a year in additional premiums under the House plan. A nonfederal retiree with the same income (part from Social Security and part from a private pension plan) would pay only about $110 more in premiums, according to NARFE's estimate.
The difference between premium charges for federal retirees versus private sector retirees in the above example is that the typical single nonfederal retiree would get $6,000 from Social Security, but only the $7,566 from the private pension plan would be considered as taxable income used to figure premiums. NARFE, which represents more than a half-million retired federal workers, and some other unions representing active duty government workers, wants the premium formula modified.
A coalition of more than 50 House members led by Reps. Constance Morella (R-Md.), Frank R. Wolf (R-Va.) and Steny Hoyer (D-Md.) and other Washington area legislators, is asking the Senate and House to revamp their bills to protect federal, state and military retirees from paying higher premiums for duplicated benefits. Retired members of Congress and congressional staff members also would have to pay the higher premiums unless Congress modifies the plan when it returns next month. People
Housing and Urban Development gave a $35,000 suggestion award yesterday to retiree Robert Hollister. When he was in the Federal Housing Administration's office of general counsel, he proposed a change in FHA loan procedures that HUD says saved the taxpayers $6 million the first year.
Veterans Administration's Dr. Margaret J. Giannini has been given the President's Committee on Employment of the Handicapped award. She's director of VA's rehabilitation research and development service.