Financial Security

Financial security is the condition of having the resources to support a standard of living now and in the foreseeable future.

 “Financial Security puts me at ease and makes me feel good about my future.” – Louise Hay

 

Medicare

Despite campaign promises to the contrary, President Trump has put Medicare security at risk.

The new 2018 tax law will explode the national debt by $1.45 trillion and could end Medicare as we know it. Medicare and Medicaid together account for about 30% of the federal budget. They could be major targets for deficit reduction. Fewer insured Americans or fewer benefits will have a domino affect on jobs and purchases, de-stimulating the economy as it reduces the health of affected Americans. There is a strong link between having health insurance and health status, thus influencing productivity.   When the health care safety net begins to come apart, the effects can affect the bottom line. (“How the New Tax Plan will Affect Health Care” www.commonwealthfund.org)

Since the new tax legislation will add significantly to the national debt, reductions in social programs are certainly a possibility. The PAYGO law says that congress must offset increases in mandatory spending or reductions in tax revenue so that they don’t increase the deficit. Republicans insist that they will wave the cuts, but the critics of the tax plan worry that there may be deep spending cuts in the future. As an aside, curbing immigration as is being carried out by the current administration, reduces the number of workers available to contribute to the Social Security, Medicare fund. In addition, out of pocket cost shares for health care are already slated to rise in coming decades. (“If You Care About Social Security and Medicare, You Should Care About These Tax Bills www.taxpolicycenter.org)

In July 1965, President Lyndon B. Johnson signed into law the bill that led to Medicare and Medicaid for those 65 and over regardless of income, medical history or health status.

Medicare Part A refers to hospital insurance, and Medicare Part B’s focus is on medical insurance. Over the years, changes were made. In 1972, coverage was expanded to those under 65 with permanent disabilities. Part C, Medicare Advantage Plans, (private health plans that were approved by Medicare), was added in 1997. Medicare Part D, or the Prescription Drug Improvement and Modernization Act, was established in 2003.

Today Medicare plays a major role in providing health and financial security to 59 million people nationwide. The program helps to pay for many medical care services: hospitalizations, doctor visits, prescriptions drugs, post-acute care, skilled nursing facility care, home health care, hospice and preventative services thus improving the economic security of our nation. (https://www.cms.gov/)

Medicare recipients in each of the four local counties represented by PPN:

County Total Population # on Medicare Percentage
Clay, NC 10, 952 3323 30%
Cherokee, NC 27,790 8074 29%
Towns, GA 11,205 3795 34%
Union, GA 22,493 7294 32%

(2012-2016 US Census “Public Health Insurance by Type”)

Mr. Trump’s proposed budget for 2019, includes $237 Billion in cuts to Medicare over the next ten years.

The proposals for prescription drug prices would help those with the highest drug costs but make it harder to qualify for that level of coverage and force those just shy of that threshold to pay more. About 4.5 million seniors in the group just behind those with the highest drug bills could end up spending more of their own money. The plan makes it harder for physicians to refer patients to other providers to access recommended care and doesn’t allow Medicare to fully negotiate directly with drug companies. (“What President Trump’s Medicare Proposals May Mean” www.nextavenue.org)

The 2019 proposed budget puts a freeze on most funding for the “Older Americans Act” which provides money for social and nutrition services including Meals an Wheels and home heating assistance. It will cut funding for disability programs by about 30% and gets rid of federal block grants that states use to fund programs for seniors. A new six week family leave program would be created but it would exclude people caring for sick parents or other relatives with disabilities. It eliminates the Senior Community Service Employment Program that provides job training to low income job seekers ages 55 and older. (“Attention Seniors: Trump’s Budget is Coming for your Medicare Benefits” www.washingtonpost.com)

Medicare’s Independent Payment Advisory Board was eliminated. This was designed to put a check on Medicare expenses. Because of changes in Part D (the prescription drug portion) and the way reimbursements are made, shortfalls will be paid for by government dollars and thus taxpayers. (“President Trump signed these Medicare charges into law. Here’s what to watch for” www.pbs.org)

Paul Ryan, Speaker of the House, has long espoused entitlement reform by supporting conversion of Medicare to a “premium support” program for purchasing private insurance. To combat looming deficits, this could become a reality. (“Political Reality Stands in Way of Medicare and Social Security Cuts” www.cnbc.com)

Speaker Ryan also recommends raising the age to 67 and requiring higher income citizens to pay more for insurance. (“Three ways Trump GOP May Cut Social Security, Medicare” www.forbes.com)

Despite his insistence on saving Medicare, Trump’s political advisors, Sam Clovis (senior policy advisor) and John Mashurn (policy director) are strong believers in privatizing both Medicare and Social Security. (“Trump is a Threat to Social Security and Medicare” www.retiredamericans.org)

The Affordable Care Act improved Medicare’s finances by requiring the wealthiest to pay more. Trump repealed that increased funding. (“The Overlooked Trumpcare Threat: A Medicare Time Bomb” www.huffingtonpost.com)

There are some positives.

Mr. Trump’s budget does require that Part D participate in drug abuse programs. It mandates that savings from drug companies are passed onto consumers and allows Medicare beneficiaries to continue to contribute to Health Savings Accounts or Medicare Savings accounts. (“President’s Budget Targets Medicare, Medicaid and Food Stamps“www.aarp.org)

Medicare’s High Income participants (making $500,000 a year, $750,000 for couples) will pay 5% more of part D. Medicare Advantage plans will be allowed to pay for limited long-term care expenses. (“President Trump Signed these Medicare Changes into Law. Here is What to Watch for” (www.pbs.org)

The budget calls for requiring insurers to share manufacturer rebates with patients and it also expands coverage for medications to treat substance abuse. (“Who Wins and Who Loses in Trump’s Proposed Medicare Drug Plan   www.pbs.org)

In other positive news, the budget repeals Medicare therapy caps. And by lifting non-defense domestic spending caps, the Social Security Administration will be able to improve customer service. (“Bipartisan Budget Bill Passed by Congress is Good News for Seniors www.ncpssm.org)

We Need to be Vigilant!

The Medicare program is a crucial part of the financial security of seniors and those who are disabled in our country. It provides health coverage for millions of Americans. The following excerpt from www.medicare.gov itemizes what is in jeopardy if funding is cut for this essential program.

“Medicare Part A: covers hospital care, skilled nursing facility care, nursing home care (as long as custodial care isn’t the only service needed), hospice and home health services.

Medicare Part B: covers two types of services: medically necessary and preventative services if you get them from a health care provider who accepts Medicare. It covers clinical research, ambulance services, durable medical equipment, mental health, second opinion before surgery, and limited outpatient prescription drugs.

Medicare Part C: Medicare Advantage plans are sometimes referred to as Medicare Part C. They are Medicare-approved private health insurance plans for those enrolled in original Medicare Parts A and B. When joining Medicare Advantage, one is still in the Medicare program and must continue paying the Part B premium.

Medicare Part D: adds prescription drug coverage to original Medicare, some Medicare Cost Plans, some Medicare Private-fee-for-service Plans and Medicare Medical Savings Account Plans. These plans are offered by insurance companies and other private companies approved by Medicare.” (www. medicare.gov)

Further Reading

Medicaid

The 2018 tax legislation and the tax proposals for fiscal year 2019, are both dangers to the health of the Medicaid program, the social safely net for Americans in or near poverty. The 2018 tax legislation gave massive tax cuts to wealthy corporations and individuals, putting in danger expansion of the deficit that could then jeopardize funding for essential programs such as Medicare and Medicaid. The proposed 2019 budget includes an actual $1.3 trillion cut to the Medicaid program. In order to manage these cuts, states are being given more latitude in deciding how they will work with less funding. Even though Medicaid is funded largely by federal dollars, it is administered by the states. (3)

One of the proposals included in the tax legislation for 2019 would require Medicaid recipients to work. This would turn Medicaid into something the nation’s most disadvantaged must earn rather than being a universal health care program for the poor.(8) Most Medicaid recipients do work, full or part time. Some are unpaid family caregivers or go to school. Only 7% are out of work for unknown reasons. In depressed areas, this could be because of lack of jobs. A number of Medicaid recipients are elderly or disabled. By requiring the work mandate, many could lose an important source of care giving support. (2) In Indiana, unless recipients work 20 hours or participate in a job training program, they will not be eligible beginning in 2019. An estimated 33,000 will lose coverage. (1) Kentucky has already implemented this requirement and other states have sought permission to add these work rules.(4) North Carolina has asked permission to make Medicaid eligibility contingent on work.(7)

 This new Medicaid requirement will hurt older Americans. More than 8.5 million Americans between the ages of 50-64 get their health coverage through Medicaid. Many became eligible due to the Affordable Care Act expansion of Medicaid. Their coverage could be at risk with work requirements. Older adults face obstacles to meeting those requirements. Of those who don’t already work, many are unable to due to illness, disability or care giving. Some recipients work part time, with not enough hours to meet the requirements. It may be difficult for those who should qualify for the exemptions to prove that they do.(5)

The disability community strongly rejects the work requirements. The AMA, the American Academy of Family Physicians, and the American Academy of Pediatrics have all taken a stand against the policy. Rights that make life in the community possible for those with disabilities could be at risk. Many have mental illness, intellectual disabilities and/or physical limitations that are difficult to document but impede ability to work the required number of hours. Even those who might qualify may have difficulty obtaining records, testimony from doctors and other documents. (13)

Red tape and paperwork requirements can be quite onerous and have been shown to reduce Medicaid enrollment. Missing a premium, not filing paperwork or encountering an administrative mishap can cause loss in coverage. (8) Many working adults with Medicaid work in jobs where schedules vary throughout the year. Paperwork can change every time work changes making new layers of red tape and administrative issues.(6) Care giving can be difficult to document. (7)

According to the Center for American Progress analysis of Kaiser Family Foundation data, the number of Americans forced off of Medicaid could be significant. 6.3 million could lose coverage. Those who are less healthy will have more trouble getting and keeping jobs.(7)

Work requirements themselves could ultimately impact health and that would affect employment. Losing a job because of illness would result in loss of insurance and loss of access to treatment. The cycle is vicious making it impossible to regain health and employment. All of this, of course, doesn’t help the bottom line in budgets. Emergency room care and hospitalizations need to be financed then by state dollars. It is cheaper to have insurance than have to rely on emergency care.(5) In addition, the increase in administrative work necessary to implement requirements will result in fewer dollars being spent on actual care.(8)

This is not the only challenge to Medicaid. Changing requirements for accessing Medicaid is a new issue with the current administration. A continuing issue for North Carolina and Georgia, that began under the Obama administration, is the lack of Medicaid expansion that was offered as part of the Affordable Care Act legislation. Neither North Carolina or Georgia accepted the expansion, leaving the most vulnerable residents unable to gain health insurance. The federal government would have covered 100% of the cost until 2016 and 90% after that. Both North Carolina and Georgia could have realized new economic activity, increased employment, increased local tax revenue and prevented the loss of rural hospitals. Both states chose not to take the option.

If Medicaid is expanded in North Carolina, an estimated 624,000 residents will become eligible. North Carolina Hospitals provide about one billion dollars in uncompensated care each year. This could decline sharply if the Medicaid expansion is accepted. It could also create up to 40,000 jobs and help keep rural hospitals open.(9)

As of November, 2016, the total enrollment of Medicaid recipients in North Carolina was 2,010,348. Eligibility is strict:

  • Maternity-related coverage for pregnant women with household incomes up to 196% of poverty
  • Children with household incomes up to 211% of poverty. In addition, some 19 or 20 year olds with income up to 46% of poverty level
  • Parents with dependent children with household income up to 45% of poverty level
  • Medicaid run, “Be Smart,” available to residents with incomes up to 195% of poverty
  • Childless non-disabled adults are not eligible. (9)

North Carolina Governor Roy Cooper (Democrat) makes the argument for the expansion saying that North Carolinians are already paying for the program in that they pay federal taxes but get nothing in return. He is currently in a court battle with the Republican legislature whether or not to take the expansion. Many Republican governors have accepted the expansion as the fiscally responsible thing to do.(10)

By refusing to expand Medicaid, Georgia has for years let the federal government keep funds (twelve billion dollars, so far) intended to pay for Georgians’ health coverage and stabilize rural hospitals. Georgia’s uninsured rate of 12.9% is the fifth worst in the country. Six rural hospitals have closed since 2013 and more than half the remaining are financially vulnerable to closure. By accepting the expansion, more than 300,000 Georgians could gain insurance.(6)

In addition, the expansion would yield savings due to lower uncompensated care cost plus increased revenue from exiting taxes on health providers and insurance plans. For every dollar the state spends, it will receive nine dollars from federal funding. Over 56,000 jobs could be created, boosting the state’s economic output by 6.5 billion dollars annually.(11)

Currently Medicaid provides almost two million Georgians with health care. It is the primary payer for 75% of nursing home patients and covers more than half the births in the state. It is a critical lifeline for rural hospitals and community health services statewide. Medicaid spends less than six cents per dollar on administrative costs.(12)

There are strict eligibility standards for the Georgia Medicaid program. In June, 2017, 1.7 million Georgians were enrolled:

  • Parents with children under 19, an annual income up to $6600 for a family of three
  • Pregnant women, an annual income up to $44,900, a family of three
  • Children 6-19 annual income up to $32,700, family of four
  • Blind, disabled, or over 65, annual income up to $8800 for individual or $13,200 for a couple. (12)

In the current legislative session (2018), GA house bill 669 proposed to expand Medicaid. It did not cross over to the senate. Georgia still has not expanded Medicaid.

Another danger to the Medicaid program as funding is cut, is the proposal to have lifetime coverage limits. This would be the first of its kind in the history of Medicaid. Medicaid is jointly funded by each state and the federal government. In order to reduce the federal government’s obligation to the needy, their goal is to limit funding in the guise of allowing the states more flexibility and encourage fiscal responsibility of those covered. In reality many will lose coverage. Already, Arizona and Utah are seeking a five year lifetime limit. (14)

Nursing home care is an issue for many elderly citizens of North Carolina and Georgia.

In June, 2017, Georgia had 3750 residents in assisted living, 7148 in semi-private nursing facilities and 8121 in private nursing homes. North Carolina had 3250 residents in assisted living, 6844 in semi-private nursing facilities and 7604 in private nursing homes.(16) Nationwide, Medicaid pays for most of the 1.4 million people in nursing homes, covering 20% of all Americans and 40% of poor adults. Under federal law, state Medicaid programs are required to cover nursing home care. But state officials decide how much to pay. Those under budget pressures could decrease the amount they are willing to pay or restrict eligibility. States could require families to pay for a portion, and/or limit the types of services and days of nursing home care. A combination of longer life spans and spiraling health costs has left 64% of those in nursing homes dependent on Medicaid. “Folks have worked their whole lives and paid into the system, it may be that the system will fail them.” (15)

Medicaid was created in 1965 along with the Medicare program. Medicaid is a joint federal-state program through which states receive federal financial assistance in order to furnish health and long-term services to federally recognized groups of low income families and individuals. The federal government funds half or more of the money but the states are given considerable latitude to create their own medical assistance programs. The program combines federal mandates and state-selected options with respect to who receives services and what these services are. The program has expanded well beyond its original focus and has become the dominant provider of long term services for people with disabilities.   The combination of Medicaid mandates and options has resulted in the emergence of 51 highly distinctive Medicaid programs that operate under broad national guidelines but that been shaped by state decisions about who is eligible and what they are eligible to receive. (17)

 

References

  1. Trump Administration Approves Medicaid Work Requirement for Indiana, Thousands to Lose Coverage”
  2. Work Requirements for Medicaid Will Actually Increase Poverty”
  3. “The President’s Budget Targets Medicare, Medicaid and Food Stamps”
  4. After Trump Clears the Way, GOP States Move to Charge Poor for Health Care”
  5. How Medicaid Work Requirements Will Harm Older Americans”
  6. Say Yes to Expanded Coverage, No to Work Requirements”
  7. Medicaid Work Requirements Could Cost the Government More in the Long Run”
  8. Trump’s Hidden War on Medicaid”
  9. “North Carolina and the ACA’s Medicaid Expansion” Laura Norris
  10. “North Carolina Governor Roy Cooper on Medicaid Expansion in North Carolina: You’re Already Paying for it”
  11. Fast Facts on Georgia’s Coverage Gap
  12. Medicaid Works for Georgia
  13. “New Trump Rules Will Drive People with Disabilities off Medicaid and Out of Work
  14. Trump Administration to Allow Lifetime Limits on Medicaid, Coverage for thousands at risk”
  15. Medicaid Cuts May Force Retirees Out of Nursing Homes
  16. Plan on Growing Old? Then the Medicaid Debate Affects You”
  17. A Brief History of Medicaid

Further Reading

 

Social Security

The Social Security program was established in 1935 in order to provide retirement income to select workers. It was later expanded to cover most of the US workforce. To this day, it is America’s pension plan. It provides a basic level of monthly income to workers after they have reached a certain age, become disabled or to their survivors.

The latest projections by Social Security actuaries predict that the retirement trust fund will remain viable until 2034. If Congress does nothing, there will be enough money coming in from payroll taxes to fund about 3/4 of scheduled benefits from then until 2090. (www.forbes.com – “When Can You Expect Social Security Reform” August 29, 2017)

There are several proposals on the table to fully fund Social Security benefits but politics makes it difficult to come up with a fix for the dilemma. For example, conservatives want to cut benefits; liberals want to increase or eliminate the cap on taxing wages over $127,000. (For further discussion, please see “Updating Social Security for the 21st Century: 12 Proposals” https://www.aarp.org/work/social-security/…/future-of-social-security-proposals.html)

To ignore the issues concerning the funding of the social security program is to put in jeopardy current and future retirees. Currently the program provides benefits to over 60 million people (43 million retired workers and dependents, 6 million survivors of deceased workers and 11 million disabled workers and dependents). The program is financed with payroll taxes from over 150 million workers. Money paid in by current workers is spent to pay benefits to current retirees. (www.ssa.gov)

  • Based on date of birth, retirement benefits may begin as early as age 62 (with smaller benefits by 25%), normally at 65 with full benefits or as late as 67. If you delay receiving benefits they grow by 8% per year up to age 70.       After that you can continue to delay but there will no longer be larger benefits
  • Eligibility is based on credits earned during working years. As of 2017, for every $1300, one credit is earned. Four credits are earned in a year. Forty credits will yield full benefits at retirement.
  • As of 2017, workers pay 6.2% of their wages toward Social Security. Employers pay the same amount. If self employed, the worker pays both.
  • Benefits are based on lifetime earnings. The payout reflects earnings from the 35 best income generating years.
  • Federal income taxes must be paid if a single adult makes more than $25,000 and if a combined married income is higher than $32,000.
  • Benefits may be applied for on line with a birth certificate and a copy of a W2 form from the previous year.

A large percentage of senior citizens now rely on Social Security for all or most of their retirement income. (www.investopedia.com)

Social Security recipients in each of the four local counties represented by PPN:

County Total Population # on Social Security Percentage
Union GA 22, 493 5102 22%
Towns GA 11,205 2685 24%
Clay NC 10,952 2271 21%
Cherokee NC 27,790 5776 21%

(www.factfinder.census.gov 2014-2016)

Disability benefits are available for those who have a medical condition that is expected to last at least one year or that will result in death. To apply for disability, one must have worked in jobs covered by Social Security. (www.ssa.gov)

Social Security Survivor Benefits can provide income for families of workers who are deceased. The benefits are based on age and work history plus qualifications of recipients. Monthly benefits are available to certain family members, including:

  • A widow(er) age 60 or older (age 50 or older if he or she is disabled), who has not remarried
  • A widow(er) at any age who is caring for the deceased’s child who is under age 16 or disabled
  • An unmarried child of the deceased who is younger than age 18 (or up to age 19 if a full-time student in an elementary or secondary school), or 18 or older with a disability that began before age 22
  • A stepchild, grandchild, step-grandchild or adopted child under certain circumstances
  • Parents, age 62 or older, who were dependent on the deceased for at least half of their income
  • A surviving divorced spouse, under certain circumstances

A one-time death benefit payment of $255 can be paid to the surviving spouse if he or she was living with the deceased, or if living apart and if the spouse was receiving certain Social Security benefits. In cases where there is no surviving spouse, the one-time payment is made to a child who is eligible for benefits on the deceased’s record in the month of death. (www.investopedia.com)

Spousal Benefits are available to spouses who have not worked or do not have enough Social Security credits to qualify for their own Social Security benefits. To qualify one must be at least 62 years of age, or any age and caring for a child entitled to receive benefits on the spouse’s record who is younger than age 16 or disabled. The full spousal benefit could be up to one-half the amount the spouse is entitled to receive at their full retirement age. The benefits will be permanently reduced if one chooses to begin receiving them before reaching full retirement age. (www.ssa.gov)

Spousal benefits are available to divorced spouses if the marriage lasted ten years or longer. These are based on the ex-spouse’s record (even if they have remarried) if you are unmarried, age 62 or older, the ex-spouse is entitled to Social Security retirement or disability benefits, and the benefit you are entitled to receive based on your own work is less than the benefit you would receive based on the ex-spouse’s work. The benefit is equal to one-half of the ex-spouse’s full retirement amount or disability benefit if you start receiving benefits at full retirement age. (www.ssa.gov)

Further Reading

 

 

TAXES

“Taxes are our dues — we pay our dues to be Americans and enjoy the benefits of American society. Taxes are what we pay to live in a civilized society that is democratic, offers opportunity, and has a huge infrastructure available to all citizens. This incredible infrastructure has been paid for by previous taxpayers. Roads and highways, the Internet, the broadcast airwaves, our public education system, our power grid — every day we all use this vast infrastructure. Our dues maintain it.”  –George Lakoff

As George Lakoff states, taxes are essential. It is critical that the revenue is dispersed reasonably. Unfortunately the Republican Tax Cut of 2018, although presented as tax reform is anything but. In truth it is just another giveaway to the top 1%. It slashes the corporate tax rate by 40%, raises taxes for 92 million middle-class families, and adds $1.9 trillion to the deficit which puts pressure on Congress to reduce funding for Medicare, Medicaid, Social Security and many discretionary programs.

Where does the money that the federal government spends come from?

“Almost half of all federal revenue (47 percent) comes from individual income taxes. The income tax is generally progressive: higher-income households pay a larger share of their income in income taxes than lower-income households do. Another 34 percent of revenue comes from payroll taxes, which are assessed on the wage or salary paychecks of almost all workers and are used to fund Social Security, Medicare Hospital Insurance, and unemployment insurance. By law, employers and employees split the cost of payroll taxes, but research has shown that employers pass their portion of the cost on to workers in the form of lower wages.”

SOURCE: Where Do Federal Tax Revenues Come From?

How is the tax money spent?

“In fiscal year 2014, the federal government spent $3.5 trillion, amounting to 20 percent of the nation’s Gross Domestic Product (GDP). Of that $3.5 trillion, over $3.0 trillion was financed by federal revenues. Three major areas of spending each make up about one-fifth of the budget: Social Security, Medicare, Medicaid, the Children’s Health Insurance Program, and marketplace subsidies, and defense and international security assistance.”

The Republican tax cut and jobs act of 2018

“On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act. The legislation represents the most significant tax changes in the United States in more than 30 years. It cuts the corporate tax rate from 35 percent to 21 percent beginning in 2018. The top individual tax rate will drop to 37 percent. It

cuts income tax rates, doubles the standard deduction and eliminates personal exemptions. The corporate cuts are permanent, while the individual changes expire at the end of 2025.”

The Act keeps the seven income tax brackets but lowers tax rates. These rates revert to the 2017 rates in 2026.

The Act creates the following chart. The income levels will rise each year with inflation. But they will rise more slowly than in the past because the Act uses the chained consumer price index. Over time, that will move more people into higher tax brackets.

The IRS encourages everyone to use the Withholding Calculator to perform a quick “paycheck checkup.” This is even more important this year because of recent changes to the tax law for 2018. This will give you an estimate of your 2018 tax burden.

IRS WITHHOLDING CALCULATOR

 

IMPACT OF 2018 TAX LAW

“The Congressional Budget Office (CBO) regularly offers economic forecasts, but the latest report is the first since the GOP enacted a $1.5 trillion tax cut, as well as a two-year spending blueprint that increases funding for the Pentagon and domestic programs. A $1.3 trillion 2018 spending bill was approved last month with bipartisan support as a result of that deal.

The CBO today forecasts the budget deficit — the amount Congress spends in excess of what it takes in from tax revenues — for 2018 will be $804 billion, will once again cross the $1 trillion threshold starting in 2020 and will continue to climb through 2028 with no end in sight.”

“Even though we’re well into the new year, there’s still a fair amount of trepidation surrounding tax reform and its ultimate impact. On the one hand, some Americans will do better now that tax brackets have been overhauled. On the other hand, some taxpayers might lose out now that certain key deductions have been eliminated under the recent changes.”

 

IMPACT ON RETIRES

“But if there’s one group that might truly prove to be a mixed bag as far as tax reform goes, its retirees. Here are just a few ways seniors could wind up affected.”

  • More retirees might claim the standard deduction.
    Itemizing on a tax return can make sense for retirees with a high level of deductions. Case in point: An estimated 30% of seniors enter retirement with mortgage debt, and those folks may be more likely to itemize since they can take the mortgage interest deduction. But in light of the recent changes, it may no longer make sense for you to itemize as a retiree, and for two key reasons. First, whereas the standard deduction used to be $6,350 for single tax filers and $12,700 for joint filers, those numbers have virtually doubled for the current tax year. Now, the standard deduction stands at $12,000 for single filers and $24,000 for those filing joint returns. This means that for it to make sense to itemize, your deductible expenses will need to exceed these figures.
  • Some retirees may opt to move.
    The new tax laws limit the SALT deduction to $10,000, and while that may not impact homeowners in less expensive parts of the country, those living in states with high property taxes (like New York, New Jersey, and California) will lose out on some tax savings across the board.
  • Medical expenses might make a big difference
    That’s because under the new laws, you’re allowed to deduct medical expenses that exceed 7.5% of your adjusted gross income (AGI). This means if your AGI is $60,000, and you spend $16,000 of it on healthcare, you’ll have an $11,500 deduction on your hands. And that could be enough to make itemizing worth it.”

SOURCE: How Will Tax Reform Impact Retirees?

IMPACT ON HEALTH CARE

“The new Republican tax bill, is complex, but what it will mean for health in the United States is simple: less

It will mean less health insurance for individuals; less coverage for elderly and poor Americans; less revenue for doctors, hospitals, and myriad health care businesses; and, quite possibly, a less-healthy, less-productive workforce.

The tax bill will be the most important health care legislation enacted since the Affordable Care Act (ACA) in 2010. The law’s two major health-related aspects are the elimination of the penalties paid by people who fail to have health insurance as required by the so-called individual mandate, and the bill’s overall impact on the federal deficit — which will increase by an estimated $1.45 trillion after allowing for predicted economic growth.

According to the Congressional Budget office the repeal of the individual mandates penalties could result in in as many 13 million fewer Americans have health insurance.

Because of the speed with which it was pushed through Congress, the health care implications of the tax legislation got little attention in the debate. Given its huge consequences for health care, health care businesses, and the American economy writ large, those consequences should have been the subject of robust debate.”

SOURCE: How the New U.S. Tax Plan Will Affect Health Care

WAGE GAINS ELUSIVE

“February’s blockbuster jobs report — a huge gain in employment and drops in the unemployment rate among key groups — was not matched by the March number released Friday morning. The economy added 103,000 jobs in March, according to preliminary estimates, and the number of jobs created in January and February was adjusted downward by 50,000 (down 63,000 in January and up 13,000 in February).”

“That soaring number in February, celebrated by President Trump, looks more like an outlier. The three-month average of jobs created was about 202,000 — largely in line with that average over the past several years. (The average three-month average since January 2015 is 204,000.)”

SOURCE: Three months into the tax cuts, significant wage gains seem elusive

 

FINANCIAL PICTURE OF STATES PARTICIPATING IN PPN

GEORGIA

“Gov. Nathan Deal held budget signing ceremonies across the state for next year’s $25 billion state budget. The legislation, HB 44, will support Georgia citizens by funding initiatives in education, human services, public safety, state infrastructure and other key areas. This budget is based on a 3.5 percent increase in general fund revenues over FY 2017, reflecting Georgia’s sustained economic growth

SOURCE: Deal signs FY 2018 budget

GEORGIA’S 2019 FISCAL BUDGET

“While the proposed budget represents a high water mark for Georgia in absolute dollars, per-capita state spending is just below pre-recession levels. The resulting proposal leaves gaps in public investments such as K-12 education and health care that are crucial to families’ financial security and Georgia’s economic health. Notably, the governor’s proposal fails to close the persistent austerity cut in K-12 education, leaving a gap of $167 million between state appropriations and the amount of money called for by the state’s own funding formula. The budget also assumes lawmakers will once again fail to close Georgia’s health coverage gap, leaving billions in federal Medicaid funds on the table for yet another year.”

SOURCE: Overview of Georgia’s 2019 Fiscal Year Budget

NORTH CAROLINA

On March 1, Governor Cooper announced his recommended budget for 2017- 2019. His budget request calls for a pay raise for state employees and includes an additional $271 million for each of the next two years to raise teacher salaries by 5%. The Governor’s recommended budget would also expand Medicaid coverage for an additional 624,000 individuals.

The proposed budget addresses several NC Association of County Commissioners’ goals. It provides funds to support raising the juvenile justice age, which is a NCACC priority goal, and it increases funding for Juvenile Crime Prevention Councils. The budget also adds 4,700 new slots for children to attend pre-k programs, and directs more than $12 million to address the opioid crisis through community mental health services and additional crisis beds. These investments in early childhood education and mental health are consistent with NCACC’s health and human services goals. Furthermore, the budget makes investments in NC FAST, which is an online processing system for Medicaid and other public assistance programs. The budget maintains lottery funding for Public School Building Capital at the existing level of $100 million.

Governor Cooper’s recommended budget also supports a key NCACC economic development goal by adding $20 million for broadband internet services, and establishing new grants to help local governments expand access to high-speed internet services. The Governor’s budget also increases funding for the Clean Water Management Trust Fund, which is a NCACC environment goal. Other major highlights include a $150 million increase in funding for transportation infrastructure investments and $185 million for road maintenance.

NORTH CAROINA 2019 FISCAL BUDGET

Highlights of the $23 billion budget for North Carolina state government for the 2017-18 fiscal year that has received final approval in the Senate and tentative approval in the House can be accessed by clicking the source below. Unless otherwise noted, monetary figures reflect increases or reductions to base budget expenses or the amount of revenue generated or lost. The two-year budget bill also covers the 2018-19 fiscal year, but those provisions can be altered by the General Assembly when it meets next year.

SOURCE: Highlights of Final Budget by North Carolina Legislature

SOURCE: IMPACT OF TAXCUT ON NORTH CAROLINA RESIDENTS

COUNTY FINANCIAL INFORMATION

The primary revenue source for each county is the property tax.

The following links provide a detailed description of each counties 2017 budget

UNION COUNTY GA BUDGET
TOWNS COUNTY, GA BUDGET
CLAY COUNTY, NC BUDGET
CHEROKEE COUNTY, NC BUDGET