[Congressional Record (Bound Edition), Volume 154 (2008), Part 1]
[Senate]
[Pages 1295-1296]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  SOCIAL SECURITY COLA PROTECTION ACT

  Mr. JOHNSON. Madam President, shortly before our adjournment last 
December, I was joined by several of my Senate colleagues in 
introducing the Social Security COLA Protection Act of 2007. This 
legislation will provide seniors with much-needed relief from steadily 
increasing Medicare premiums and will ensure that their Social Security 
cost-of-living adjustment, or COLA, is available for other essential 
needs such as food, housing, and energy.
  I want to first thank Senators Boxer, Inouye, Leahy, Mikulski, 
Murray, Reed, Rockefeller,  and Salazar for joining me in this effort. 
Representative Herseth Sandlin introduced the companion bill today in 
the House of Representatives, and I want to thank her for her 
leadership on this issue and

[[Page 1296]]

other important topics to seniors in South Dakota.
  Sixteen percent of South Dakotans are Medicare beneficiaries. When 
compared to a national average of 14 percent, it is clear that Medicare 
policies significantly affect my home State. Many of these retirees 
live on modest, fixed incomes and must pay close attention to their 
monthly expenses. South Dakota's senior citizens worked very hard all 
of their lives as farmers, small business owners, teachers, and 
parents. In their retirement, all they are hoping for is an opportunity 
to enjoy a basic level of comfort and certainty.
  Unfortunately, as the cost of health care continues to rise at an 
alarming rate, it becomes more and more difficult for seniors to 
achieve this sense of security during retirement. According to the 
Kaiser Family Foundation, the United States spent about $2 trillion on 
health care in 2005, almost three times the $696 billion spent in 1990. 
That $2 trillion represents 16 percent of the gross domestic product. 
The rate at which our Nation's health care spending increases is also 
troubling; health care spending has exceeded economic growth in every 
decade since the 1970s.
  These increasing health care costs hit the pocketbook of every 
American, but our senior citizens, many of whom live on fixed incomes, 
have a particularly hard time making ends meet while health care costs 
climb. The Centers for Medicare and Medicaid Services, or CMS, recently 
announced that the Medicare Part B premium, which covers seniors' 
doctor visits and other nonhospital services, would increase 3.1 
percent in 2008. CMS correctly noted in its press release that this is 
smallest percentage increase in the Part B premium since 2001. However, 
CMS failed to point out that the amount seniors will pay for Part B 
premiums in 2008, $96.40, is more than double what they paid in 2000. 
Our Nation's seniors simply cannot continue to absorb these 
skyrocketing health care costs.
  This doubling of Part B premiums occurred while many Medicare 
beneficiaries incurred additional premium costs for the Part D 
prescription drug program. CMS estimates that premium costs for Part D 
will average $25 per month. However, a recent analysis by the Kaiser 
Family Foundation concludes that seniors enrolled in stand-alone 
prescription programs will experience a 17-percent increase in their 
premiums next year. Both Part D and Part B premiums generally are 
deducted from a senior's Social Security check.
  While seniors can expect a modest cost-of-living increase in their 
Social Security benefits every year, this increase has not kept up with 
the pace of increased health care costs and specifically Medicare 
premium costs. The Social Security Administration, SSA, announced that 
all Social Security and Supplemental Security Income, SSI, 
beneficiaries would receive a 2.3-percent cost-of-living adjustment, 
COLA, beginning in January 2008. Each year, Social Security benefits 
are updated based on the overall rate of inflation as calculated by the 
Bureau of Labor Statistics. COLAs are not intended to provide anybody 
with a ``raise'' but are instead intended to ensure that a 
beneficiary's monthly payment has the same buying power that it had the 
year before. A 2.3-percent increase isn't much but should help retirees 
and individuals with disabilities living on a fixed income survive as 
the prices of food, housing, clothing, and other goods continue to 
increase.
  I know that Social Security beneficiaries need every penny of their 
COLA, and it is important that rising Medicare costs not completely 
consume the Social Security COLA. In 1986, a hold-harmless provision 
took effect to ensure that no beneficiary's Medicare Part B premium 
increase could exceed his or her Social Security COLA in any given 
year. This ensured that no senior would receive a reduced Social 
Security check due to a Part B premium increase. However, this hold-
harmless provision does not apply to Part D premiums, and the 
increasing cost of both programs is quickly consuming any small 
increase beneficiaries see in their Social Security checks. This policy 
is subjecting the incomes of retirees and individuals with disabilities 
to a tight squeeze. Without a legislative change, millions of retirees 
will likely see much or all of their COLA wiped out by increases in 
Medicare premiums over the next several years. We owe it to America's 
seniors to protect the COLA from being completely consumed by Medicare 
premium increases.
  This is why I have introduced the Social Security COLA Protection Act 
of 2007, which will protect retirees by ensuring that no more than 25 
percent of a senior's COLA is absorbed by the increase in Medicare 
premiums. This important legislation will protect the financial 
security of many retirees in my home State and across the country. I 
thank all of the Members who have introduced this bill with me and urge 
the rest of my colleagues to join us in our effort.

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