STATEMENT OF POLICY The substance of the Conference recommendations on Income Maintenance and the Financing of Health Costs appears in the following Policy Statement adopted by the Section. The specific recommendations upon which this Statement is based will be found in Part III. The income security of older people is an important objective of American society. The security of older people, like the security of all Americans depends upon a strong, sound and secure economy capable of providing a high level of goods and services. The first principle of a constructive approach to the income maintenance needs of the aged, therefore, is that the measures taken to promote old-age security be in harmony with broad economic objectives. The second principle of a constructive approach to the income maintenance needs of the aged is that there should be opportunity for productive employment for those who are able and want to work. Employment is frequently more satisfactory for the individual than retirement on a pension, and such employment contributes to the economy and reduces the cost of pensions. We urge a reexamination of policies of compulsory retirement and also urge that industry and Government plan for both the full-time and part-time use of an increasing number of older persons. Although there is agreement that, to the extent possible, the aged should have a chance to work, it is recognized that on the most optimistic assumptions the number of nonearners among the aged will not only remain very large-about 12 million of the 16 million persons now over 65 have no income from work-but will grow as the number of aged grows. Employment is largely out of the question for the very old, the severely disabled, and for many of the older women who spent their younger years as homemakers. Increasing opportunities for employment of the aged cannot, therefore, be a substitute for income maintenance programs for those who retire. In providing income for the retired aged we believe that the pluralistic approach we have established in this country, with the individual saving on his own, the individual and his employer joining in private pension arrangements, and the individual and his Government joining in social insurance and assistance programs is the best approach. 594799-61-2 Income protection for old age has been made available for practically all workers through Social Security, on terms which reinforce the interest of the individual in helping himself. Differential pensions based on a work record are a reward for productive effort, while the knowledge that the benefits will be paid irrespective of whether the individual is in need, supports his desire to add his personal savings to the basic security he has acquired through the social insurance system. We believe also that the establishment and development of private pensions should be encouraged and that individuals should be encouraged to save on their own. Our goal should be, insofar as possible, to prevent dependency. It is recognized, however, that there will continue to be persons whose needs are not met in any other way and will continue to need help through the public assistance program. This program, therefore, should be improved with the view of assuring all aged persons a reasonable minimum level of living under conditions which preserve their dignity and self-respect. In summary, we favor improvement of job opportunities for those who can and want to work, development of private pension plans and individual savings building on top of the social insurance system, and, for those whose needs are not met through other methods, an adequate system of public assistance. In furtherance of these general policies, we favor the following specific actions: Old-Age, Survivors and Disability Insurance Old-Age, Survivors, and Disability Insurance, now covering 90 percent of all gainfully employed and protecting over 70 percent of the present aged group, should be extended to all who work. The level of benefits should be adjusted from time to time in the future as it has been in the past in order, at the very least, to maintain the purchasing power of the benefit. Beyond this, we believe that the aged should participate in increasing levels of living in the community and that when these increases take place benefits should be liberalized so that the retired aged, too, can participate in improved productivity. Also, as wages rise, the maximum limit on the amount of earnings that is taxable and creditable toward benefits should be reviewed. Benefits for widows should be increased to the same amount as benefits for retired workers. We believe that, by and large, the funds of the Social Security system should be reserved for those who have substantially retired and that the principle of a retirement test should be maintained although some liberalization may be desirable from time to time. Public Assistance Public assistance, under which income is provided for those among the aged-now some 2 million-whose needs exceed any income they may have from Social Security or other sources, is an essential residual program. The present arrangement of joint financing by Federal and State Governments is sound and should be continued. In many States, however, standards of assistance are below minimum needs. States should be encouraged, or if necessary required as a condition of Federal matching, to provide sufficient income for necessary food, clothing, shelter and other essentials (a motion to make this a requirement lost by a vote of 140 to 112). Many needy aged today do not receive income they need because of restrictive residence requirements. Such requirements are undesirable and should be abolished. The Congress should amend the Social Security Act to make women eligible for OldAge Assistance at the age of 62 (by a vote of 138 to 69). The Federal Government should participate financially in general assistance on the same basis as it does in other categories of public assistance. Private Pensions and Individually Provided Retirement Income The expansion and improvement of private pensions should be strongly encouraged since they can reflect directly in retirement incomes the growth and productivity of various segments of the economy. Tax incentives to encourage private savings for retirement and continuing pension plan development should be expanded. Vesting provisions constitute a desirable improvement. All persons should be encouraged to plan for their own retirement and to build on their own whatever retirement income they can to add to that available under Social Security and private pension programs. Financing Health Care The problem of furnishing an adequate level of high quality health care for the aged is so large and so complex that its solution will require the use of a variety of approaches, including individual and family resources, voluntary health insurance, industrial programs, Social Security, public assistance, and a variety of other programs. Present Federal legislation providing governmental aid for recipients of public assistance and for the medically indigent is desirable and should be strengthened so as to provide a high-quality health care program. The States are urged to take full advantage of this legislation. Voluntary health insurance for the aged should continue to be expanded. Industry should be encouraged to expand its health care programs and extend to retired persons the medical care protection afforded to current workers. Private voluntary effort and public assistance can contribute much to the solution of the problem of health care for the aged. However, they will continue to fall short of meeting the basic medical care needs of the aged as a whole. The majority of the delegates of the Section (by a vote of 170 to 99) believe that the Social Security mechanism should be the basic means of financing health care for the aged. Establishment of a program of health benefits financed in the same way as OASDI cash benefits, would give to the aged the assurance that the costs of essential health care will be met when their working years are over. The mechanism of contributory social insurance, under which contributions are made by workers during their working years, will then provide health care to protect them in retirement. Such legislation would help to ease the problems of hospitals, public assistance programs and private philanthropy and would relieve voluntary insurance programs of the burden of carrying this high risk group. The minority believe that Social Security should not be used to finance health care; that such use would interfere with the physicianpatient relationship; that it is unnecessary because of the potential growth of voluntary insurance; and that all needy aged can be cared for by public assistance through the recently enacted Federal program of health care for the low income aged. In addition they believe that the Social Security program should provide for cash benefits and not for services of various kinds. (See the minority report below.) Collection and Analysis of Essential Information Provision should be made at all levels of Government to assure an adequate program to collect and analyze all essential information bearing on the income status and budgetary needs of aged persons. Conclusion The delegates feel that these principles, conclusions and recommendations can form the basis of a sound program of income maintenance for the aged and that they would, if implemented, go far in assuring to America's senior citizens a more economically secure and therefore happier old age. Minority Report: Financing of Health Care It is our conviction that emphasis on the voluntary approach to the financing of health care, supplemented by adequate public assistance for those in need is the only method which is (1) In accord with official expressions of the majority of State conferences on aging. (2) The only one which allows complete flexibility of action to meet the changing health needs of the aged. (3) Capable of utilizing the immediate advantage of present legislation for a cooperative action of State and Federal Government. (4) The only one through which diverse segments of our society, including the individual, family, church, social organizations, employers both public and private, labor, and others can be encouraged to participate along with providers of health care. (5) The only one which does not unnecessarily further burden the taxpayer. For these reasons, we believe that the Kerr-Mills Medical Aid for the Aged Law, passed by the last Congress, effectively meets the needs of those of the aged who need help and that proposed alternatives, under Social Security, are unnecessary and unwise. |