Datagrams exam 2 4

Question 1

Age-based entitlement programs are specifically for older adults. For needsbased
programs eligibility depends upon financial need

Answer 1

d

Question 2

Currently, expenditures for Social Security and Medicare make up almost 40%
of the federal budget.

Answer 2

d

Question 3

The U.S. government spent $437.9 billion in Medicare benefits in 2007. By
2016, this expenditure is projected to rise to $862.6 billion

Answer 3

d

Question 4

When Social Security and Medicare are excluded from federal allocations, only
about 4% of the total federal budget is devoted to programs that benefit older
adults

Answer 4

d

Question 5

Approaches to the financing and delivery of aging services evolved in a very
different time period, when life expectancy was shorter and federal revenues
were of less concern.

Answer 5

dd

Question 6

The Social Security tax is 12.4% which is shared equally by the employee and
employer

Answer 6

d

Question 7

The Social Security Act of 1935, the first national public benefits program, grew
out of the market failure of the Depression and established the federal
government as a major player in the social welfare arena. The purpose of Social
Security was to establish a system of income maintenance for seniors to protect
against financial disaster. It was never intended to be the sole source of
retirement income.

Answer 7

d

Question 8

The average Social Security recipient is paid 41% of their pre-retirement
income, a figure that is projected to remain relatively stable through the year
2040.

Answer 8

d

Question 9

Since old-age constituencies have been viewed as relatively homogenous, many
older people with the greatest needs—women, ethnic minorities, the oldestold,
and those living alone—have not always benefited from program
improvements relative to their needs

Answer 9

d

Question 10

To reduce the federal deficit, there are two major options: reduction in
spending through program cut-backs, or revenue enhancement through higher
taxes

Answer 10

d

Question 11

Even though the deficit is now escalating, many Republicans seek to reduce
taxes and allow more individual control over Social Security investments, while
Democrats want to preserve basic care programs such as Social Security and
Medicare.

Answer 11

d

Question 12

Social Security has four separate trust funds: Old Age and Survivors Insurance,
Disability Insurance, Hospital Insurance (funded through Medicare), and
revenues for the Supplemental Insurance portion of Medicare

Answer 12

d

Question 13

Social Security was never intended to be about wealth building, but rather a
shared sense of responsibility for the income security of all older people

Answer 13

d

Question 14

Every worker contributing to Social Security, regardless of age, has disability
insurance worth over $200,000.

Answer 14

d

Question 15

Social Security is a system whereby current workers support retired or disabled workers and thus is intergenerational in nature.

Answer 15

d

Question 16

In 1935 there were 50 workers for every Social Security recipient. By 2003, the
ratio of workers to recipients was 3.3 to 1. By 2031, the ratio is projected to be
2:1

Answer 16

d

Question 17

Social Security benefits are progressive, or most helpful, to those with low to
moderate income who qualify.

Answer 17

d

Question 18

Polls consistently show that Americans overwhelmingly support protecting
Social Security

Answer 18

d

Question 19

A number of proposals are currently being debated as ways to address the
funding concerns associated with Social Security. These include: privatization,
raising the retirement age (for full benefits), increasing payroll taxes, reducing
cost-of-living adjustments, reducing benefits, raising the cap on the amount of
wages and salaries subject to payroll taxes, and adding an affluence test by
eliminating benefits for higher-income workers

Answer 19

d

Question 20

Supplemental Security Income (SSI) only reaches 40-60% of eligible lowincome
persons.

Answer 20

d

Question 21

Less than 50% of the current labor force is covered by an employer-sponsored
pension plan.

Answer 21

d

Question 22

Area Agencies on Aging (AAAs) were developed to administer services at the
local and regional level. There are now nearly 629 AAAs and 246 tribal
organizations that fulfill these functions.

Answer 22

d

Question 23

People age 65 and older account for about 13% of the total U.S. population, but
over 30% of the nation’s annual federal health care expenditures.

Answer 23

d

Question 24

Medicare, which was established in 1965, was intended to provide financial
protection against the cost of hospital and physician care for people age 65 and
older. Despite this goal, Medicare now covers only about 57% of the health care
expenses for older adults.

Answer 24

d

Question 25

Medicare’s major limitation is its focus on acute care and lack of coverage for
chronic care expenditures.

Answer 25

d

Question 26

Medicare has 3 primary “parts.” Medicare Part A is concerned with hospital
insurance. Medicare Part B is concerned with supplemental medical insurance.
Part D, the newest component of Medicare, is concerned with prescription drug
costs

Answer 26

d

Question 27

A prospective-payment system was instituted in 1983. Instead of reimbursing
providers for each service for each patient, payment is determined by the
diagnostic category in which each patient is placed.

Answer 27

dd

Question 28

In general, home health care is less expensive than hospital care, and about
40% less expensive than nursing home care. Of all Medicare expenditures, only
2.4% is for home health care.

Answer 28

d

Question 29

Adults over age 65 account for over 40% of total spending on medications.

Answer 29

d

Question 30

The price of the most commonly used prescription drugs tends to increase by 3
times the rate of inflation and is expected to grow by 12% a year through 2011.

Answer 30

d

Question 31

• Less than 29% of the total Medicare budget covers nursing home expenditures.

Answer 31

d

Question 32

Spending on Medicare and Medicaid consumed approximately 24% of the
federal budget in 2009.

Answer 32

dd

Question 33

Medicaid is a federal and state means-tested welfare program of medical
assistance for the poor, regardless of age

Answer 33

d

Question 34

About 42% of long term care costs are paid by Medicaid.

Answer 34

d

Question 35

Older persons comprise about 10% of the total users of Medicaid, yet they
account for approximately 40% of the total expenditures nationally.

Answer 35

d

Question 36

Medicaid is the 2nd largest budget item for most states

Answer 36

d

Question 37

Only about 30% of Medicaid expenditures go to community-based home health
care services, even though home health services are more cost-effective and
preferred by elders and their families.

Answer 37

d

Question 38

About 30% of all long-term care expenditures are paid on an out-of- pocket
basis. Those paying out-of-pocket use a combination of pension income, Social
Security benefits, and savings and investments.

Answer 38

d

Question 39

Medigap Supplemental Insurance is a form of private insurance which provides
protection for items and services that Medicare does not cover, such as
deductibles and co-payments, items such as eye exams and hearing aids, and
charges exceeding the amount approved by Medicare.

Answer 39

d

Question 40

Private long-term care insurance plans usually pay a fixed amount for each
qualified day in a nursing home.

Answer 40

d

Question 41

Wide disparities exist among elders in their ability to purchase supplemental
and long term care insurance. Only 47% of the poor or near poor elders who
suffer from chronic illnesses and disability have private insurance, compared to
almost 90% of their higher income and healthier peers

Answer 41

d

Question 42

• The United States remains the only industrialized nation that does not provide
some form of universal health coverage, regardless of ability to pay.

Answer 42

d

Question 43

Under the Health Maintenance Organization (HMO) system, health care costs
are covered and health care is provided through a prepaid premium. This
means that a single payment per user covers all pre-approved services, rather
than fee for service.

Answer 43

d

Question 44

To reduce costs, some HMOs have shortened hospital stays, set upper limits on
the number of home care visits and rehabilitative services provided, steadily
increased out-of-pocket beneficiary costs, and cancelled or placed caps on
special benefits such as prescription drugs, eyeglasses, and hearing aids

Answer 44

d