The Norman Transcript

Nation/World

April 15, 2013

Medicare increase could ding some in middle class

WASHINGTON — Retired city worker Sheila Pugach lives in a modest home on a quiet street in Albuquerque, N.M., and drives an 18-year-old Subaru.

Pugach doesn’t see herself as upper-income by any stretch, but President Barack Obama’s budget would raise her Medicare premiums and those of other comfortably retired seniors, adding to a surcharge that already costs some 2 million beneficiaries hundreds of dollars a year each.

Due to the creeping effects of inflation, 20 million Medicare beneficiaries also would end up paying higher “income related” premiums for their outpatient and prescription coverage over time.

Obama administration officials say Obama’s proposal will help improve the financial stability of Medicare by reducing taxpayer subsidies for retirees who can afford to pay a bigger share of costs.

Congressional Republicans agree with the president on this one, making it highly likely the idea will become law if there’s a budget deal this year.

But the way Pugach sees it, she’s being penalized for prudence, dinged for saving diligently.

It was the government, she says, that pushed her into a higher income bracket where she’d have to pay additional Medicare premiums.

IRS rules require people age 70-and-a-half and older to make regular minimum withdrawals from tax-deferred retirement nest eggs like 401(k)s. That was enough to nudge her over Medicare’s line.

“We were good soldiers when we were young,” said Pugach, who worked as a computer systems analyst. “I was afraid of not having money for retirement and I put in as much as I could. The consequence is now I have to pay about $500 a year more in Medicare premiums.”

Currently only about 1 in 20 Medicare beneficiaries pays the higher income-based premiums, which start at incomes over $85,000 for individuals and $170,000 for couples. As a reference point, the median or midpoint U.S. household income is about $53,000.

Obama’s budget would change Medicare’s upper-income premiums in several ways. First, it would raise the monthly amounts for those currently paying.

For local news and more, subscribe to The Norman Transcript Smart Edition, or our print edition.

1
Text Only | Photo Reprints
Nation/World
  • U.S.: Russia firing across border

    KIEV, Ukraine — Russia is launching artillery attacks from its soil on Ukrainian troops and preparing to move heavier weaponry across the border, the U.S. and Ukraine charged Friday in what appeared to be an ominous escalation of the ...

    July 26, 2014

  • Small holes cause big jitters

    SEOUL, South Korea — For the developers of the world’s sixth tallest building near Seoul, a mysteriously shrinking lake and the appearance of small sinkholes in residential neighborhoods couldn’t have come at a more inopportune time. ...

    July 26, 2014

  • Secret photo victims must describe trauma for case

    BALTIMORE — Thousands of women whose genitals might have been photographed during gynecological exams can share a $190 million settlement from Johns Hopkins Health System. But they’ll have to describe their trauma before seeing any money. ...

    July 26, 2014

  • Worries about U.S. consumers drag stocks lower

    NEW YORK — Investors got some bad news about the American shopper on Friday, driving down stocks and sending the Dow Jones industrial average to a loss for the week. Two major U.S. companies — the retail giant Amazon and the credit card ...

    July 26, 2014

  • Air Algerie jet crashes with 116 on board

    OUAGADOUGO, Burkina Faso — An Air Algerie jetliner carrying 116 people crashed Thursday in a rainstorm over restive Mali, and its wreckage was found near the border of neighboring Burkina Faso — the third major international aviation ...

    July 25, 2014

  • Very bad week: Airline disasters come in a cluster

    WASHINGTON — Nearly 300 passengers perish when their plane is shot out of the sky. Airlines suspend flights to Israel’s largest airport after rocket attacks. Two airliners crash during storms. Aviation has suffered one of its worst weeks ...

    July 25, 2014

  • Hong Kong firms on edge as democracy rally blockade looms

    HONG KONG — As activists vow to shut down Hong Kong’s financial district in protest at China’s attempt to hobble democratic elections in the city, businessman Bernard Chan is preparing for the worst. Chan’s investment company has added ...

    July 25, 2014

  • Planes with Ukraine bodies arrive in the Netherlands

    KHARKIV, Ukraine — Two more military aircraft carrying remains of victims from the Malaysian plane disaster arrived in the Netherlands on Thursday, while Australian and Dutch diplomats joined to promote a plan for a U.N. team to secure the ...

    July 25, 2014

  • Iraq elects new president as attacks kill dozens

    BAGHDAD — Iraqi lawmakers elected a veteran Kurdish politician on Thursday to replace long-serving Jalal Talabani as the country’s new president in the latest step toward forming a new government. But a series of attacks killed dozens of ...

    July 25, 2014

  • Doctor fired back at gunman

    DARBY, Pa. — A doctor grazed by gunfire from a patient who had entered his office in a suburban hospital’s psychiatric unit stopped him by returning fire with his own gun and injuring him, authorities said....

    July 25, 2014