MONEY Medicare

What You Need to Know About Medicare Open Enrollment

Pharmacy
You can shop for a new drug plan starting October 15. Getty Images—Getty Images

Your once-a-year chance to change your drug coverage or switch plans begins in two weeks. Here's what to expect.

Medicare beneficiaries who want to make changes to their prescription drug plans or Medicare Advantage coverage can do so starting Oct. 15 during the Medicare’s program’s annual open enrollment period. There will be somewhat fewer plans to pick from this year, but in general people will have plenty of options, experts say.

And although premiums aren’t expected to rise markedly overall in 2015—and in some cases may actually decline—some individual plans have signaled significantly higher rates. Rather than rely on the sticker price of a plan alone, it’s critical that beneficiaries compare the available options in their area to make sure they’re in the plan that covers the drugs and doctors they need at the best price.

The annual open enrollment period is also a once-a-year opportunity to switch to a private Medicare Advantage plan from the traditional Medicare fee-for-service plan or vice versa. Open enrollment ends Dec. 7.

Although the Centers for Medicare and Medicaid Services has released some specifics about 2015 premiums and plans, many details about provider networks, drug formularies and the like won’t be available until later this fall. Here’s what we know so far:

Standalone Prescription Drug Plans

The number of Part D standalone prescription drug plans (PDPs) will drop 14%, to 1001 plans. This is the smallest number of offerings since the Medicare Part D program began in 2006.

Even so, “seniors across the country will still have a choice of at least two dozen plans in their area,” says Tricia Neuman, director of the Program on Medicare Policy at the Kaiser Family Foundation (KHN is an editorially independent program of the foundation.)

The drug plan consolidations that are driving the reductions in choices will likely shift many beneficiaries into lower cost plans, resulting in an average premium decline of 2%, to $38.95, according to an analysis by Avalere Health.

But that overall average premium obscures significant price hikes by some of the biggest plans. The average premium for the WellCare Classic plan, for example, will increase 52% in 2015, to $31.46, while the Humana Walmart RxPlan premium will rise 24%, to $15.67, according to Avalere.

Insurers are expected to continue to shift more costs to beneficiaries next year. The percentage of PDP plans with no deductible will decline to 42% from 47%, and, once again, about three quarters of plans won’t offer any coverage in the “donut hole”— the coverage gap in which beneficiaries are responsible for shouldering a greater share of their drug costs.

Underscoring the importance of evaluating plan options, 70% of standalone drug plan members will likely see their premiums increase if they stick with the same plans in 2015, says Ross Blair, senior vice president for eHealthMedicare.com, an online vendor.

Seniors, though, have historically not voluntarily switched plans in great numbers during annual enrollment. Between 2006 and 2010, on average only 13% did so, according to a 2013 analysis by researchers at Georgetown University, KFF and the University of Chicago.

Medicare Advantage

Enrollment in Medicare Advantage plans continues to grow: 30% of Medicare beneficiaries are now in the private plans, which typically are managed care plans that often provide additional benefits such as vision and dental coverage. Concerns that Medicare Advantage plans would disappear in large numbers as the health law gradually reduces their payments to bring them in line with the traditional Medicare program have proven unfounded to date. In 2015, the number of plans will drop by 3%, to 2,450, continuing a gradual decline.

“You still have lots of plans and robust selection,” says Caroline Pearson, vice president at Avalere Health, a research and consulting firm. Some parts of the country appear to be harder hit by plan reductions than others, including the Southeast and mid-Atlantic regions, Pearson says.

Medicare Advantage coverage has always been concentrated in health maintenance organizations, and this trend will continue in 2015. The number of HMOs will increase by 1.5%, to 1,747, while the number of preferred provider organizations will drop by nearly 9%, to 541, according to Avalere. About two-thirds of Medicare Advantage beneficiaries are currently in HMOs, while 31% are in PPOs.

The average premium will increase by $2.94 to $33.90, but nearly two-thirds of beneficiaries won’t see any premium increase, according to CMS. Like standalone drug plans, however, fewer Medicare Advantage drug plans will offer no deductibles and gap coverage, according to Avalere.

“It’s one example of how plans are tightening up coverage,” and pushing more costs onto consumers, says Pearson.

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.

MONEY Ask the Expert

How to Live Well on Less by Retiring Overseas

140605_AskExpert_illo
Robert A. Di Ieso, Jr.

Q: I hear a lot about people retiring overseas to make their retirement savings go further. My wife and I are pretty adventurous. But can we really save money retiring in another country?

A: Retiring abroad isn’t for everyone—but more and more people are doing it. Nearly 550,000 Americans receive their Social Security benefits abroad, up from nearly 400,000 in 2000, according to the Social Security Administration. That’s a small number compared to the 43 million people over 65 receiving Social Security benefits. Still, 3.3 million of America’s 78 million Baby Boomers say they are interested in retiring abroad, according to Travel Market Report.

The growing interest in overseas living isn’t all that surprising, considering the worries of many pre-retirees about making their money last. There’s no question that you can live well on less in many countries. But to make that happen, you’ll need to plan carefully, says Dan Prescher, an editor at International Living, which publishes guides on the best places to retire overseas.

For most Americans, the biggest savings are a result of the lower prices for health care and housing overseas, says Prescher, who lives in Ecuador with his wife Suzan Haskins. The couple co-authored a book. The International Living Guide To Retiring Overseas On A Budget.

Most countries have a national healthcare system that cover all residents, and monthly premiums are often less than $100. It’s relatively easy to become a resident of another country, which typically involve proving you’ll have at least a modest amount of income, perhaps $1,000 a month.

But quality of health services varies, so research carefully, especially if you have medical problems. Even in countries with well-rated health care systems, the best services are centered around metropolitan areas. “Larger cities have more hospitals and doctors. The farther out you go, the quicker the quality falls off,” says Prescher.

Though Medicare doesn’t cover you if you live abroad, it’s still an option, and one that you should probably keep open. If you sign up—you’re eligible at age 65—and keep paying your premiums, you can use Medicare when you are back in the U.S.

Home prices, property taxes and utilities can be significantly lower in Mexico and countries in Central and South America, which are popular with U.S. retirees. In Mexico, you can find a nice three-bedroom villa near the beach for as little as $150,000, says Prescher.

But you’ll pay a premium for many other needs. Gas and utilities can cost a lot more than in the U.S. And you will also pay far more for anything that needs to be imported, such as computers and electronics or American food and clothing. “A can of Campbell soup can easily cost $4.50,” says Prescher. “You have to ruthlessly profile yourself, and see what you can or can’t live without, when you are figuring out your spending in retirement.”

Then there are taxes. As long as you’re a U.S. citizen, you have to pay income taxes to the IRS, no matter where you live or where your assets are located. Even if you don’t owe taxes, you must file a return. If you have financial accounts with more than $10,000 in a foreign bank, you must file forms on those holdings. In addition, the new Foreign Accounts and Tax Compliance Act (FATCA), which requires foreign banks to file U.S. paperwork for ex-pat accounts, has made many of them wary of working with Americans. You may also need to pay taxes in the country where you reside if you own assets there.

Check out safety issues too. Use the State Department’s Retirement Abroad advisory for information for country-specific reports on crimes, infrastructure problems and even scams that target Americans abroad.

The best way to find out if retiring abroad is for you is to spend as much time in your favorite city or village before you commit. Go during the off-season, when it may be rainy or super hot. See how difficult it is to get the things you want and what’s available at the grocery store. Read the local papers and check out online resources. In addition to International Living’s annual Best Places to Retire Overseas rankings, AARP writes about retiring abroad and Expatinfodesk.com publishes relocation guides.

The most valuable information will come from talking to other ex-pats when you’re visiting the country, as well a through message boards and online communities. “You’ll find that ex-pats have to have a sense of adventure and patience to understand that things are done differently,” says Prescher. “For many people, it’s a retirement dream come true.”

TIME politics

Lawmakers Push Increased Access to Emergency Contraception

Bipartisan U.S. Budget Deal Said to Ease Automatic Spending Cuts
Sen. Patty Murray (D-Wash.), who introduced a bill to increase access to emergency contraception. Bloomberg—Bloomberg via Getty Images

Bill comes ahead of a midterm elections in which women are expected to be a key voting bloc

Updated: September 23, 4:40 p.m. ET

Five Democratic senators introduced legislation Tuesday that would require any federally-funded hospital to provide emergency contraception to rape survivors.

The Emergency Contraception Access and Education Act of 2014 was introduced by Sen. Patty Murray (D-Wash.), with Sens. Elizabeth Warren (D-Mass.), Barbara Boxer (D-Calif.), Richard Blumenthal (D-Conn.) and Cory Booker (D-N.J.) signing on as co-sponsors. The bill would ensure that any hospital receiving Medicare or Medicaid funds provides accurate information and timely access to emergency contraception for survivors of sexual assault, regardless of whether or not they can pay for it. It would also require the Secretary of Health and Human Services to disseminate information on emergency contraception to pharmacists and health care providers.

“As we saw in the aftermath of the Hobby Lobby decision, and as we’ve seen in state legislatures across the country, Republicans are intent on standing in the way of women and their ability to make their own decisions about their own bodies and their own health care,” Senator Murray told TIME. “This means, now more than ever, it is our job to protect these kinds of decisions for women, their families, and particularly for survivors of sexual assault. Emergency contraception is a critical part of these family planning choices and it’s time Republicans join us in supporting this safe and responsible means of preventing unintended pregnancies.”

“It is unacceptable that a survivor of rape or incest can be denied access to emergency contraception in the emergency room, and therefore forced to carry a pregnancy caused by her attacker,” Planned Parenthood president Cecile Richards said in a statement. “Decisions about emergency contraception, like all forms of birth control, should be between a woman and her doctor, not her pharmacist, her boss, or her Congressman.”

The bill may face opposition from congressional Republicans, and comes just two months before the midterm elections, in which many expect women to be a decisive voting bloc.

TIME Healthcare Policy

Getting Poor to Get Help: How a Tragic Accident Trapped My Family in Poverty

Trapped in America's Safety Net
Trapped in America's Safety Net Courtesy University of Chicago Press

Campbell is the author of the new book, Trapped in America’s Safety Net: One Family’s Struggle.

When Andrea Louise Campbell's sister-in-law was horribly injured, she and her family had to spend down their money and assets to get the medical care they needed

Nearly one-third of American households live in or near poverty. The causes are myriad – and much contested. Those on the political right tend to cite the personal shortcomings of poor individuals while those on the left blame systemic barriers to upward mobility. But as my family has painfully learned, there is another shocking cause: government policy.

In February 2012 my sister-in-law Marcella was in a car accident on her way to nursing school, where she was working towards a career which she hoped would catapult her and my brother Dave into middle-class security. Instead, the accident plunged them into the world of American poverty programs. Marcella is now a quadriplegic, paralyzed from the chest down. She needs round-the-clock personal care and assistance. The only source – public or private – for a lifetime of such coverage is Medicaid. But because Medicaid is the government health insurance for the poor, she and my brother must be poor in order to qualify. (Medicare does not cover long-term supports and services, and private long-term care insurance is time-limited and useless to a 32-year-old who needs decades of care). Thus, Marcella and Dave embarked on a hellish journey to lower their income and shed their modest assets to meet the state limits for Medicaid coverage.

To meet the income requirement, my brother reduced his work hours to make just 133 percent of the poverty level (around $2,000 per month for their family). Anything he earns above that amount simply goes to Medicaid as their “share of cost” – a 100 per cent tax.

Worse: the asset limit. In California, where they live, they can own only $3,150 in assets beyond their home and one vehicle. They’re “lucky,” a social worker tells Dave: if not for the baby (Marcella was pregnant at the time of the accident; the baby miraculously survived), the asset limit would be $3,000. As if you can raise a child on $150. This asset limit was last raised in 1989. It has fallen by half in real value since then.

Dave and Marcella began to liquidate. Under California rules, retirement plans are not exempt from the asset test. Marcella had to cash in a small 401(k) account from a previous job, paying the early withdrawal penalty to boot. Dave had to abandon his hobby, working on old cars, which violated the asset test. He sold them all, keeping a 1968 Datsun pickup because its tiny value didn’t impinge on the asset limit. The pickup is 45 years old, weighs less than a Miata, and has no modern safety features. The only able-bodied adult in the family has to drive to work in an unsafe vehicle. And they had to empty their bank account, watching their hard-earned security disappear.

As Dave and Marcella spent down their assets, they had to keep track of every penny. They could only put the money into the exempt items, the house and the used wheelchair van they bought for Marcella. They could not use the money to pay credit card bills, household bills, or Marcella’s student loans from her undergraduate degree. And they are barred from doing any of the things the middle class is constantly advised to do: save for retirement. Create an emergency fund. Save for college with a tax-free 529 plan. Just $3,150 in assets – that’s it.

What happens in an emergency? One day the van’s wheelchair ramp stopped working. The repair cost $3,000—the sum of their meager assets. Fortunately their tax refund had just come in and went straight back out to pay for the repair. We don’t know what they’ll do next time.

What would help folks like Marcella and Dave?

True universal health insurance. A universal social insurance program for long-term care, not just Medicaid. And one modest change: no asset test. Policy is already trending in that direction. Under the Affordable Care Act, those newly eligible for Medicaid face no asset test. (Unfortunately those in the original eligibility categories, including the disabled like Marcella, are still under the old rule.) About half of the states have no asset test for any Medicaid recipient; perhaps someone realized that trying to ferret out the tiny amount of resources most Medicaid applicants have is inefficient. As for Dave and Marcella, I suppose they might move to a state with more generous rules. However, no state helps with wheelchair renovations. Lacking the assets to buy a new house elsewhere, they must remain in the home their friends renovated for them on an entirely volunteer basis.

It’s bad enough that America’s system of social supports is so limited. That the government also forces some of its citizens to get poor to get the help they need is an abomination.

 

Andrea Louise Campbell is professor of political science at the Massachusetts Institute of Technology. She is the author of Trapped in America’s Safety Net, out this month.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

MONEY Health Care

Why Health Care Spending Is Going Up—But Not Skyrocketing

A stronger economy and more insured Americans should help push up health care spending in the coming years, according to a new government report. But don't expect a return to the high pre-recession growth rates soon.

National health spending will increase modestly over the next decade, propelled in part by the gradual rebound of the U.S. economy and the growing ranks of Americans who became insured under the health law, government actuaries projected Wednesday.

But those growth rates are not as high as what the country saw for the two decades before the Great Recession crippled the U.S. economy at the end of 2007, according to the report from the Centers for Medicare & Medicaid Services Office of the Actuary and published in the journal Health Affairs.

The actuaries estimate that health spending grew just 3.6% in 2013, the fifth year of historically low rates of spending growth. But it will accelerate to 5.6% in 2014. They also forecast that the average growth rate for 2015-2023 would be 6%. That is up just slightly from last year.

The findings also suggest that health care will outpace growth in the gross domestic product over the next decade. Health care’s share of GDP, which has remained fairly stable since 2009, will rise from 17% in 2012 to more than 19% in 2023.

While some health care analysts and Obama administration officials have said the Affordable Care Act is reducing costs, CMS actuaries are no longer measuring the effects of the law on health care spending.

“We are no longer quantifying the impacts of the Affordable Care Act on national health spending,” Andrea M. Sisko, the lead author on the study, told reporters at a briefing on the findings. “Now that the Affordable Care Act has been in place for well over four years, it is becoming increasingly difficult to accurately estimate … what the world would look like in the absence” of the law.

Sisko also said it is too soon to estimate the impact of the health law’s delivery system changes on the nation’s health care system.

Paul Ginsburg, a public policy professor at the Schaeffer Center for Health Policy and Economics at the University of Southern California, said the report illustrates that “the recession and the very slow recovery from the recession are important determinants of health spending trends …. There’s a been a lot of debate over the past year or two about how much of the slowdown we’ve experienced has been from the business or the economic cycle and how much is due to real changes in health care. My sense is it’s both. This very steep recession and this very slow recovery from it, especially when you look at the very low growth in wages, is something that has definitely depressed health care spending. The implication of higher deductibles, of greater cost sharing, that’s important as well.”

Better economic conditions, the aging of the baby boomer generation into Medicare and increased number of people with insurance are expected to result in greater demand for health care goods and services, increases in health coverage and faster rates of spending growth, in particular for private health insurance, the researchers said.

Those trends, the researchers said, will be countered by somewhat slower growth in Medicare payment rates mandated by the health law, cuts made to hospitals and doctors in the congressional budget-cutting efforts and the increasing use of higher deductibles in private insurance plans that have cut down on consumer health spending.

The number of uninsured people is projected to fall from about 45 million in 2012 to 23 million by 2023, according to CMS actuaries.

Other key takeaways from the CMS report include:

– Medicare spending growth slowed from 4.8% in 2012 to 3.3% in 2013. That was caused by the automatic 2% payment cuts known as sequestration and other payment adjustments, especially reductions in federal payments to the private Medicare Advantage plans that offer an alternative to traditional Medicare. Late last month, the Congressional Budget Office estimated that lower costs for medical services and labor will help reduce both Medicare and Medicaid spending over the next decade.

Continued movement of baby boomers into the program and more spending on older beneficiaries will cause Medicare expenditures to rise 7.9% in 2020, according to the CMS report.

– Medicaid’s growth rate is expected to rise from 3.3% in 2012 to 6.7% in 2013, reflecting the health law’s Medicaid expansion—which is optional for states—and the effect of the law’s temporary payment increase for primary care physicians, among other factors. The researchers forecast that Medicaid spending will spike nearly 13% in 2014 but the growth rate will fall back to 6.7% the following year.

– In 2014, private health insurance premiums are projected to grow 6.8%, largely a result of higher per-enrollee spending and increased insurance coverage through the health law’s online marketplaces, or exchanges, and individually purchased insurance. For 2016-23, average premium growth for private health insurance is projected to be 5.4% per year.

– For 2016-2023, faster increases in disposable personal income and greater enrollment in private health insurance will contribute to the projected 6.1% spending growth per year for health care services, faster than the 4.7% average growth expected for 2013-15. But those conditions are likely to change, researchers warned.

“Consistent with the historical relationship between health spending and economic cycles, these projected changes in the economy are expected to influence health expenditure growth with a lag,” resulting in a projected peak growth in health spending of 6.6% in 2020, CMS said.

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.

MONEY Social Security

Maximize Your Social Security Benefits…By Not Freaking Out

Seniors doing yoga on the beach
Lyn Balzer and Tony Perkins—Getty Images

A financial planner explains why, when it comes to retirement income, being patient can pay off in a big way.

About a month ago, a client walked into our office and announced that he had decided to take his retirement package being offered at work. We had to work out a number of issues related to his company’s retirement benefits. Finally, when the subject of Social Security came up, my client said, “I want to start taking the benefit as soon as I can, before they stop it.”

His opinion of Social Security is common. Many retirees believe that Social Security may run out or that Congress may legislate away their benefit.

We pushed back on this. First, the actuarial analysis shows the Social Security fund is pretty secure; it is Medicare that we all need to be worried about. Second, we feel that for a current retiree, the benefit amount is fairly safe; the only possible changes might involve a lower increase in the annual benefit. We agree with most experts that making changes to current benefits is a non-starter.

Our client was persuaded. Then he asked us a question we hear a lot: “When should I start taking Social Security, at age 66 or 70?”

The answer is not straightforward. If our client — let’s call him Jack — started taking Social Security at age 66, he’d receive a monthly benefit of $2,430. But your initial benefit increases the longer you postpone taking it, until you reach age 70. If Jack delayed taking the benefit until he turned 70, the initial amount would be $3,680, or 52% more per month.

Since Jack has other forms of retirement income, he doesn’t need the monthly check as soon as possible to live on. Instead, Jack’s goal is to get as much back from Uncle Sam as possible.

If Jack started his benefit at age 66, he would receive approximately $116,700 by age 70. (He’d actually get more, since benefits are adjusted annually for inflation. But for the sake of simplicity, I am ignoring inflation and other complicating factors.)

If he waited until age 70, he would be receiving $1,250 more per month, but he wouldn’t have received any money over the prior four years. It would take around 94 months to recoup the $116,700 he did not earn by waiting.

In other words, Jack would have an eight-year breakeven point if he waited until 70. If Jack dies before age 78, he would have received more by taking the benefit at age 66; if he lives past 78, he would be better off to wait until age 70. Federal life expectancy tables say a male 65 years old has a life expectancy of age 82. So if Jack has average health, the odds suggest he should wait until age 70 to take his benefit.

Jack’s wife — we’ll call her Jill — is 65, and has been retired for a couple of years. Jill’s Social Security projection looks like $2,120 monthly at age 66 or $3,200 at age 70. Jill’s breakeven also projects to be at age 78, yet her life expectancy is age 85, so the odds that she will be better off waiting until age 70 are greater than Jack’s.

But they both shouldn’t necessarily wait until 70 to take their benefits. Why? Because Social Security offers married couples a spousal benefit option.

This takes us into a different kind of strategy with our clients, something advisers call “file and suspend.”

It is possible to start taking a spousal benefit at age 66 (as long as your spouse has filed for his or her own benefit amount) and let your personal benefit increase to the maximum amount at age 70. The strategy is to have both spouses wait until 70 to take their own benefit, but for the spouse with the lower benefit amount to take a spousal benefit from age 66 up to age 70. For this to work, the spouse with the higher benefit amount needs to file for his or her benefit—then suspend receiving his or her own benefit until age 70.

For Jack and Jill, the file and suspend would work as follows: Jack, the spouse with the higher benefit, files for benefits at age 66, then immediately requests the benefits be suspended; that’s “file and suspend.” Then at age 70, he requests his benefits, which would be approximately $3,680 a month.

Jill files for her spousal benefit at age 66. This allows her to delay her own benefit while collecting a spousal benefit of around $1,250 a month. Then at age 70, she cancels the spousal benefit in order to collect her full benefit of $3,200 a month.

This scenario would provide them an added benefit of almost $60,000 in those first 4 years!

All Social Security scenarios have a breakeven age, so it is important to take an honest look at your health when evaluating all your options. The most important factor is your own cash flow need when you retire. If Social Security is going to be one’s sole source of income in retirement, waiting until age 70 is probably not an option.

But for those who can, delaying benefits is a useful tool. Outliving your money in your 80s or 90s is a real possibility. Postponing Social Security to allow for the highest possible benefit can mitigate that longevity risk.

—————————————-

Scott Leonard, CFP, is the owner of Navigoe, a registered investment adviser with offices in Nevada and California. Author of The Liberated CEO, published by Wiley in 2014, Leonard was able to run his business, originally established in 1996, while taking his family on a two-year sailing trip from Florida to New Caledoniain the south Pacific Ocean. He is a speaker on investment and wealth management issues.

MONEY First-Time Dad

Why Millennials Aren’t Lazy, Spoiled or Entitled…

Luke Tepper

...At least not any more than other generations are.

Mrs. Tepper and I spent the better part of the past week trying to induce our six-month old son Luke to sleep through the night. After a parade of co-sleepers, swings, night feedings and magic sleeping suits, it was time — our doctor told us — to go medieval and let the little guy cry in his room until he woke up the next morning.

The (seemingly) endless sobbing was difficult to endure, but within a few nights, Luke slept all night. He did it! And so did we.

Luke’s accomplishment not only put our minds at ease, it helped stroke our parenting egos. Now when other parents ask us how he’s sleeping, we’ll be able to look them dead in the eyes and with not a small amount of satisfaction say, “We got him to sleep like a log.”

Parenting, much like sports and everything else, is competitive. If you think your kid is cuter than mine, well, we might just have a problem. Of course, this is silly. Whether a kid sleeps through the night, rolls over, or cries incessantly is largely a matter of luck and circumstance. Some parents happen to have a newborn that sleeps well, while others don’t and there are millions in between.

The mistaking of luck for skill, the conflation of happenstance for personal achievement, is pervasive in our society. You even see this play out in the management of mutual funds. In fact, I think this natural phenomenon is one reason that older generations think mine is narcissistic, instead of simply unlucky.

More than a few readers have responded to my articles with a common refrain that kids today are given much more than older generations — and thus are much more willing to spend and less principled in saving. And that this deficit accounts for Millennials’ current economic struggles.

Fine, though older generations complaining about the lives lead by their children and their children’s children is just as much a cliché. Nevertheless, a few facts and figures may help to enlighten the perception of today’s young adults and help align the views of those from different ages.

We Grew Up During the Great Recession

Millennials graduated college in the teeth of the worst economic downturn since the Great Depression. While people of all ages felt its impact, Millennials were a little more vulnerable — if not economically, then psychologically — than other groups.

In a recent speech, the chairman of the White House’s Council of Economic Advisers highlighted just how rough the Great Recession was on Millennials. “While the unemployment rate for those over 34 peaked at about 8%, the unemployment rate among those between the ages of 18 and 34 peaked at 14% in 2010 and remains elevated, despite substantial improvement,” Furman said.

Graduating into a recession leads to lower wages, which has been especially true for those who had the misfortune of turning 22 in 2008. In fact, per a recent Pew Research Center survey, “Millennials are the first in in the modern era to have higher levels of debt, poverty and unemployment, and lower levels of wealth and personal income than their two immediate predecessor generations had at the same time.”

We Pay More to Raise Our Kids Than You Did

If you had kids in 1985, and the mother of those kids worked, you paid on average $87 (in 2013 dollars) a week in child-care expenses, according to Pew. In 2010, the figure grew to $148. That means, on average, working mothers today pay over $3,000 more a year on child care than their mothers paid for them.

Of course, child-care expenses, like real estate, differ zip code to zip code. We live in Brooklyn and teamed up with another family to hire a nanny. The total cost to us? Almost $400 a week.

And it doesn’t look like families like ours well get help anytime soon. A few months ago, the International Labor Organization put out a report which found that the U.S. and Papua New Guinea are the only two countries in the world that have “no general legal provision of maternity leave cash benefits.”

Not only is it more expensive to raise your kids now, but we live in one of the two countries in the entire world that doesn’t offer any help.

You Are More Entitled Than We Are

Despite the fact that some think that seniors have earned their Social Security and Medicare benefits, entitlements have always been a transfer of wealth from the working to the elderly. Ida May Fuller was a legal secretary who retired in the end of 1939 having paid $24.75 in social security taxes. A couple of months later, she received the first retirement check and would go on to accumulate almost $23,000 in Social Security benefits.

Ida is not alone. According to the Urban Institute, a couple that earned $71,700 (in 2013 dollars) a year from 22, and retired in 2015, will receive more than $1 million in lifetime benefits (including Social Security and Medicare.) This despite paying nearly $650,000 in lifetime entitlement taxes.

Now, I’m fine paying taxes to fund a social program that has so effectively reduced elderly poverty and improved the lives of millions of people. I just don’t want those recipients of public funds to think of my generation as entitled.

Look, so much of our success is defined by luck.

If you graduated college during the Carter or Reagan presidencies, you entered an economy that was adding between 150,000 and 250,000 jobs a month. Over the past 14 years? Not so much.

Of course, you can’t do much to control your macroeconomic environment. The only thing non-policy makers can do is hope — hope that in 28 years your son is luckier than you were.

So when you think about Millennials in terms of living at home and deifying self-aggrandizing behavior, remember the economic hardships that we endured and you didn’t. Remember that others who receive Social Security and Medicare may not have really earned those funds. Remember “there but for…” and appreciate the luck you have in this world.

Taylor Tepper is a reporter at Money. His column on being a new dad, a millennial, and (pretty) broke appears weekly. More First-Time Dad:

MONEY Health Care

Why the Good News for Retiree Health Care May Not Last

With overall health-care costs in check, Medicare didn't hike the premiums seniors pay again this year. But once economic growth picks up, rising prices could come back too.

Medicare turned 49 years old last week, and the program celebrated with some good financial news for seniors: Premiums will not rise in 2015 for the third consecutive year.

The question now: How long can the good news persist? Worries about Medicare’s long-range financial health persist, but for now persistent low healthcare cost inflation will translate into a monthly premium of $104.90 next year for Part B (outpatient services), according to the Medicare trustees. Meanwhile, the Centers for Medicare & Medicaid Services (CMS) says the average premium for a basic Part D prescription drug plan will rise by about $1, to $32 per month.

The Part B premium has been $104.90 since 2012—except for 2011, when it actually dropped by about $15, to $99.90. The moderation is good news for seniors, since premiums are deducted from Social Security checks. Beneficiaries will keep all of next year’s Social Security cost-of-living adjustment, which likely will be about 1.7%.

Meanwhile, the average Part D premium has been $30 or $31 since 2011. That’s because of a dramatic shift to cheap generic drugs, and innovation by plan providers competing for customers.

“Seniors can expect to see more of what they’ve been getting over the last few years, which is increasing effort by Part D insurers to offer very-low-premium plans,” says Matthew Eyles, executive vice president of Avalere Health, a consulting firm specializing in healthcare.

As in recent years, Eyles says, the best deals will be found in plans that require enrollment in preferred pharmacy networks. Those plans offer lower premiums and co-pays. “We’ll also see plans limiting or eliminating deductibles, and encouraging the use of generics by offering them free or at nominal prices,” says Eyles.

But the average figures mask a more complicated story. Part D enrollees will find significant regional variations in premiums around the country. CMS data shows average premiums will be as low as $21.19 in New Mexico, and $25.83 in Florida—but as high as $39.74 in Idaho and Utah.

Eyles says it is not entirely clear why premiums will vary so extensively, although the prices tend to track the overall cost of healthcare, and are related to the overall healthiness of seniors by state.

“The plan providers have to submit bids for regions that take into account differences in the enrolled populations, including prescribing and utilization patterns,” he says. “It could be that one state tends to have more people using statins, or a diabetes medication.”

Another complication in Part D is the “doughnut hole,” the gap in coverage for Part D enrollees with high drug costs. Higher-cost plans are available to provide gap coverage, but the hole’s size is being shrunk under a provision of the Affordable Care Act (ACA), and the gap is set to disappear in 2020.

The coverage gap begins after you and your drug plan have spent a certain amount for covered drugs. Next year the gap starts at $2,960 (up from $2,850 this year) and ends after you’ve spent $4,700 (up from $4,550 this year).

Seniors who enter the gap also get discounts on brand-name and generic drugs, and those breaks will be larger next year. Enrollees will pay 45% of the cost of brand-name drugs in 2015 (down from 47.5% this year) and 65% of the cost of generic drugs (down from 72% this year).

Can the recent good news on lower healthcare costs continue indefinitely? Medicare spending reflects our overall health economy, and the big picture is that the United States does not have effective controls on spending growth. Healthcare outlays have quadrupled since the 1950s as a percentage of gross domestic product, to 17.7% in 2011. What’s more, our spending is more than double any other major industrialized nation, according to the Organization for Economic Cooperation and Development.

Still, our per capita Medicare spending growth averaged 2% from 2009 to 2012, and it was nearly zero last year.

The Obama administration often points to the ACA, but outside experts are more skeptical. Research published this month by Health Affairs, a leading health policy and research and journal, credited 70% of the recent spending slowdown to the slack economy. Absent further changes in the structure of our healthcare system, the researchers expect higher healthcare inflation to resume as the economy improves.

“A significant amount of it is due to the economic slowdown,” says Eyles, “although we know that changes in the way providers deliver care, and how providers are being paid are also making a difference in the overall rate of growth.”

TIME health

The Most Shocking Mistakes Hospitals Don’t Want You to Know About

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knape—Getty Images

They include foreign objects left in the body, air embolisms and giving patients the wrong blood type

Is it somehow unfair that the public knows that one airline – Malaysia Air – flew two of the planes in our most recent commercial aviation tragedies? After all, the exact cause of either catastrophe isn’t yet known, and it’s not clear that Malaysia Air was at fault in either. The airline flies roughly 91,000 flights per year safely; no Malaysian Air flight had been involved in a fatal accident since 1995. Is it really fair to name the airline?

I suspect your reaction – almost everyone’s reaction — to this line of thought is roughly, “Fair? Who cares about fair? Of course we have a right to know.” Perhaps only a lobbyist for the American Hospital Association (AHA) could have any sympathy for suppressing the name of a company that has a terrible accident. The AHA has just successfully employed a similar “fairness” argument in convincing the Obama Administration to eliminate government disclosure of the worst medical mistakes committed by hospitals.

As of this month, the Centers for Medicare and Medicaid Services (CMS) has removed data on many “never events” from its public website, Hospital Compare. “Never events” are just what they sound like: errors so egregious they should never happen. The term came into widespread use in 2006, when the National Quality Forum defined 28 serious healthcare errors. While CMS has never published data on all the never events until recently, it made public records of some of the worst and most preventable, such as foreign objects left in the body, air embolisms (a killer air bubble entirely preventable during surgery), giving the wrong blood type to a patient and bedsores allowed to develop into extremely painful and even deadly wounds. CMS now believes that continuing to publish this information is unfair to hospitals.

Never events – unlike airplane crashes – actually happen quite often. CMS’ Inspector General estimated 1 in 165 admissions of a Medicare patient involved a never event. It is estimated that foreign objects left in a patient’s body after surgery occurs once every 5,500 operations. That rate would translate into 9,345 objects left in patients in per year.

Hospitals point out correctly that the data on never events are incomplete, and that collection methods vary. They point to statistical analyses that suggest that occurrence of a never event doesn’t always reflect the hospital’s entire safety record. As a result, they claim never events data shouldn’t be used to compare hospitals, and that this information might confuse, rather than inform, patients. According to Nancy Foster, the vice president for quality and patient safety policy at AHA, “The only thing we have insisted upon is that the measures be accurate and fair, that they represent a real picture of what’s going on in an individual hospital if you’re going to put it up on a public website.”

Oddly, these arguments seem to resonate with regulators, even though the Obama Administration has generally shown a commitment to increased medical transparency. Part of the problem is structural; as the predominant funder of hospitals, CMS has always been an ambivalent regulator. And the AHA has a lot of friends in Congress, allowing them to find mouthpieces for their talking points. At the recent “1,000 Preventable Deaths a Day” Senate hearing on patient safety, Rhode Island Sen. Sheldon Whitehouse noted that “while obviously we all want robust reporting,” the burden on hospitals and the confusion of too much data suggested “focusing on simplifying and directing attention to a few clear agreed measures.” It all sounds so reasonable, until you understand that what AHA and its allies have been pressing on CMS is the elimination of public reporting, not its improvement.

The counter-example of airline regulation clearly demonstrates the self-serving nature of this line of reasoning. Can we imagine an airline executive or lobbyist arguing that the public had no right to know any piece of data about airline safety? But of course in aviation safety, we long accepted the primacy of consumer safety over industry “fairness.” In health care, we still believe that hospitals can kill patients as a result of errors and retain rights to confidentiality. That may help explain why the airline industry grows safer every year, and estimates of deaths from medical errors are now so high they would rank as the third-leading cause of death in America behind only cancer and heart disease.

Let’s say we were “unfair” to hospitals and actually published all never events data, incomplete though they may be. “Irrational” and “poorly informed” patients might avoid hospitals with a lot of never events. Patients who suffered a never event at a hospital might “unfairly” demand compensation upon discovering the particular error occurred frequently. Hospitals might be forced to respond to this patient misuse of data by improving efforts to decrease the incidence of never events. It might all seem terribly unfair to hospitals. But to a patient who trusts his life and well being to a hospital, having a foreign object left in her body after surgery can result in pain, additional treatment and even death. And doesn’t that also seem—what’s the word—unfair?

David Goldhill is the CEO of GSN, a media company, and the author of Catastrophic Care: Why Everything We Think We Know about Health Care is Wrong.

MONEY Social Security

The 5 Key Things to Know About Social Security and Medicare

No need to panic, but both Social Security and Medicare face long-term financial challenges, this year's trustees report finds. There's still time to make fixes.

If you worry about the future of Social Security and Medicare, this is the week to get answers to your questions. The most authoritative annual reports on the long-term health of both programs were issued on Monday, and while the news was mixed, there are reasons to be encouraged about our two most important retirement programs.

Under the Social Security Act, a board of trustees reports annually to Congress on the status and long-term financial prospects of Social Security and Medicare. The reports are prepared by the professional actuaries who have made careers out of managing the numbers and are signed by three cabinet secretaries, the commissioner of Social Security and two publicly appointed trustees—one Republican, one Democrat.

Here are my five key takeaways from this year’s final word on our social insurance programs.

* Imminent collapse nowhere in sight. Social Security and Medicare face long-term financial problems, but there’s no cause for panic about either program.

Social Security’s retirement program is fully funded for the next 19 years. It has $2.8 trillion in reserves, and that figure will rise to $2.9 trillion in 2019, when the surplus funds will begin depleting rapidly as baby boomer retirements accelerate. Although you’ll often hear that Social Security spends more annually than it receives in taxes, the program actually took in $32 billion more than it spent last year, when interest on bond holdings and taxation of benefits are included.

The retirement trust fund will be depleted in 2034, at which point current revenue would be sufficient to pay only 77% of benefits—unless Congress enacts reforms to put the program back into long-term balance.

Medicare’s financial outlook improved a bit compared with last year’s report because of continued low healthcare inflation. The program’s Hospital Insurance trust fund – which finances Medicare Part A— is projected to run dry in 2030, four years later than last year’s forecast and 13 years later than forecast before passage of the Affordable Care Act (ACA).

In 2030, the hospital fund would have enough resources to cover just 85 percent of its expenditures. (Medicare’s other parts—outpatient and prescription drug services—are funded through beneficiary premiums and general revenue, so they don’t have trust funds at risk of running dry.)

Could healthcare inflation take off again? Certainly. Some analysts—and the White House – chalk up the recent cost-containment success to features of the ACA. But clouds on the horizon include higher utilization of healthcare, new medical technology and a doubling of enrollment by 2030 as boomers age.

* Medicare is delivering good pocketbook news. The monthly premium for Medicare Part B (outpatient services) is forecast to stay put at $104.90 for the third consecutive year in 2015. That means the premium won’t take a larger bite out of Social Security checks, and that retirees likely will be able to keep most— if not all—of the expected 1.5% cost-of-living adjustment (COLA) in benefits projected for next year. (Final numbers on Part B premiums and the Social Security COLA won’t be announced until this fall.)

* Social Security Disability Insurance (SSDI) requires immediate attention. The program faces a severe imbalance, and only has resources to pay full benefits only until 2016; if a fix isn’t implemented soon, benefits would be cut by 20 percent for nine million disabled people.

That can be avoided through a reallocation of a small portion of payroll tax revenues from the retirement to the disability program – just enough to keep SSDI going through 2033 while longer-range fixes to both programs are considered. Reallocations have been made at least six times in the past. Let’s get it done.

*Aging Americans aren’t gobbling up the economic pie. Social Security outlays equalled 4.9% of gross domestic product last year and will rise to 6.2% in 2035, when the last baby boomer is retired. Medicare accounted for 3.5% of GDP in 2013; it will be 3.7% of GDP in 2020 and 6.9% in 2088.

* Kicking the can is costly. There’s still time for reasonable fixes for Social Security and Medicare, but the fixes get tougher as we get closer to exhausting the programs’ trust funds. Social Security will need new revenue. Public opinion polls show solid support for gradually eliminating the cap on income subject to payroll taxes (currently $117,000) and gradually raising payroll tax rates on employers and workers, to 7.2% from 6.2%. There’s also strong public support for bolstering benefits for low-income households and beefing up COLAs.

Medicare spending can be reduced without resorting to drastic reforms such as vouchers or higher eligibility ages. Billions could be saved by letting the federal government negotiate discounts on prescription drugs, and stepping up fraud prevention efforts. And an investigative series published earlier this summer by the Center for Public Integrity uncovered needed reforms of the Medicare Advantage program, pointing to “tens of billions of dollars in overcharges and other suspect billings.”

Your move, Congress.

Related stories:

How to Fix Social Security—and What It Will Mean for Your Taxes

Why Taxing the Rich Is the Wrong Way to Fix Social Security

3 Smart Fixes for Social Security and Medicare

 

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