Tag Archives: retirement planner

If you’re in your 50s, you need to plan for long-term care right now

My Comments: “Who me? Nah, I’m good. I’m not going to become goofy or worry about someone helping me take my meds every morning. Or help me prepare my meals. Or help me in the shower…”

(BTW, this image is of my mother who suffered from Alzheimers for 10 years after my father died.)

by Carmen Reinicke \ June 22, 2018

More money doesn’t always lead to more planning, especially when it comes to unpopular subjects like end-of-life care.

Less than a quarter of high net worth clients currently have plans for long-term care in place, according to a poll of financial advisors by Key Private Bank, the wealth management arm of KeyCorp.

The poll surveyed nearly 150 advisors about their experiences with high net worth clients, those with assets over $1 million.

Advisors said persuading clients to devise plans for long-term care is a challenge. They also said it is difficult to balance saving for long-term care with other financial goals such as saving for college or buying a house.

“Part of it has to be the typical head-in-the-sand approach,” said Chad Stevens, senior financial planner at Key Private Bank. “‘If I ignore it, it’ll go away.'”

Having tough conversations is part of the job of an advisor, and it’s important to talk about the financial risks of aging, said Stevens.

“Unless you plan now, you can’t be sure that your goals will be accomplished,” Stevens said.

Plan carefully
It is important to make sure that your financial goals align with your lifestyle goals for retirement and end-of-life care.

Most clients said their top choice for long-term care is to stay in their own home and be fully independent, according to the survey. But this wish may be unrealistic; more than half of people over age 65 today will need long-term care at some point, according to AARP, a nonprofit advocacy group for in older Americans.

The second most popular choice is to move into an assisted living facility, followed by staying at home with the help of family members and personal aids.

The projected costs of long-term care are increasing, according to a report by Genworth Financial, an insurance company. In 2017, the median annual cost of a home health aide was $49,192, and the median cost of a private room in a nursing home was $97,455. By 2027, the median annual cost of a home health aide is expected to be $66,110, while the median cost of a private room in a nursing home will be $130,971 per year.

“Many underestimate the costs or think that Medicare or health insurance will cover it,” said Jean Accius, vice president of long-term services and supports at the AARP Public Policy Institute, which does public policy research, analysis and development at AARP.

But, that is not always the case, Accius said.

Most people “think they’ve prepared but when something happens they don’t have nearly enough,” said Amy Fuchs, an aging life-care expert. She also said that when people sign up for long-term life insurance without thinking through what their needs will be later in life, they might think they are covered when they are not.

If clients don’t prepare for these costs, they may end up paying out of pocket. This can quickly eat into their savings and negatively affect other financial goals.

“If leaving a financial legacy for your family is important, you need to plan ahead for that,” said Debra Drelich, who runs a private practice called New York Elder Care Consultants LLC.

Start early

Advisors recommend that clients start planning for long-term care years before they think they will need it. The most robust planning sessions should occur between ages 40 and 50.

“Don’t avoid the conversation,” said Stevens from Key Private Bank. “Find a trusted advisor that will give you an idea of what plans are out there so you can make an educated decision.”

Starting early will give you more time to assess what the options are in your home city and state, because location can greatly limit what services are available.

“Where you live matters — it limits your choices and options,” said Accius. He said many resources are available for families who want to begin planning, including the AARP scorecard, which ranks states based on the long-term services they provide.

An early start will also help if you decide to buy long-term care insurance; the younger and healthier you are when you purchase, the lower the cost will be.

Having a plan is the best way to ensure that the late years of your life are as smooth as possible, according to financial advisors and aging life care experts.

“We plan for weddings and we plan for graduations, and we do it very thoughtfully,” said Anne Sansevero, a geriatric nurse practitioner and founder and CEO of HealthSense LLC, an aging life care management consulting company. “But this is our life, our years ahead.”

“Just like saving for retirement, you have to save for your health and well-being,” she said.

Communicate with family

Beyond having a plan, it is important to communicate your wishes for long-term care with your family, financial advisors and aging life care professionals say. Few advisors report that their clients are communicating with their families about their wishes for long-term care, according to the Key survey.

“Sometimes older adults don’t let their kids in and provide them with that information, so the kids have no idea,” said Debra Feldman, an aging life care professional and founder and president of her own firm, Debra D. Feldman and Associates.

She said that if older adults are not initiating the conversation, children should come to their parents. Waiting too long can lead to scrambling in a time of crisis, she said.

Having your family on the same page will alleviate stress and pressure and allow everyone to enjoy the golden years of your life more.

“Talking through long-term care desires early-on with family members will be crucial to setting expectations, delegating responsibilities and avoiding misunderstandings or surprises,” said Stevens.

Source: https://www.cnbc.com/2018/06/22/if-youre-in-your-50s-you-need-to-plan-for-long-term-care-right-now.html


A Retirement Plan for Workaholics – 5 Tips

My Comments: If you’re still a working stiff, the idea of eventual retirement crosses your mind from time to time.

In years past, we thought of live as having two phases: childhood and adulthood. In childhood we are dependent on others and in adulthood we are dependent on ourselves. Adults worked until they died or found someone to look after them.

In the mid 19th Century, the idea of ‘retirement’ surfaced and became a third phase of life if you had not already died. Here in the 21st Century it’s the norm. Having enough money to live another 30 years without working is the game plan for most people.

What to do if you’re someone who loves to work, is happy working, and probably has enough money saved to make some kind of retirement possible. Here are five tips for you.

by Douglas Dubitsky \ July 5, 2017

Can a workaholic ever retire?

Many workaholics genuinely enjoy the rush of starting and completing projects and continuing the nonstop cycle. So it may also be difficult for them to contemplate what life may be like in retirement once they are officially out of the workforce.

If you’re a workaholic, smoothing your transition to retirement means uncovering the answer to the question: What part of the end of your job will you miss the most? It might be the people. Or the challenges. Or having purpose. Once you know which it is, you can focus on how to reap the same benefits — and feelings — while not holding down full-time employment.

Here are 5 tips to help workaholics ease into retirement:

1. Start slowly. If you jump into retirement all at once, the shock to your routine might be too much to handle. Instead, look for opportunities where you can work part-time, even with your current employer.

Cut back on your work hours gradually and your nonworking life could just slip into place. Look for a weekend job, or an after-hours job, to start while you’re employed full time. This could turn into part-time employment that you may want to pursue during retirement.

You might want to find out if your current employer would consider keeping you on as a consultant in retirement. This may help your employer retain your institutional knowledge while you enjoy a more flexible schedule.

If you plan to take Social Security retirement benefits before Full Retirement Age (between 66 and 67, depending on when you were born) and work at the same time, however, your benefit will be reduced if you make more than the yearly earnings limit. In 2017, the Social Security earnings limit is $16,920. Social Security deducts $1 from your benefit payments for every $2 you earn above the earnings limit.

2. Experiment and schedule.
As you wean yourself away from work, look for new ways to occupy your mind. This could be as simple as taking a cooking class, volunteering or exercising every morning before breakfast.

Also, at least in the beginning, either schedule your days down to the hour so you always have something to do or time-block the beginning or ending half of the day.

Has your spouse or any of your friends retired recently? Retirement may prove to be a great opportunity for you to spend more time with him or her. The same goes if you have children or grandchildren. You can reroute the attention you gave to your job to your family and friends.

3. Give yourself a break. A recent study by my company, The Guardian Life Insurance Company of America, found that one in six Americans is very dissatisfied with his or her life. Often, workaholics feel guilty about not having spent enough time with their families during their careers. Some didn’t pay attention to themselves either, or to the physical and mental benefits that come with rest.

So as you ease into retirement, don’t forget to take care of your own needs even as you strive to care more for those around you.

4. Talk it out. If you find that postwork life is more difficult than you anticipated — or even worse, that you’re feeling depressed or overwhelmed — don’t hesitate to get help. It’s important that you talk about your feelings with friends, family or other retirees going through similar transitions.

5. Look ahead. Most retirees find it doesn’t take long to adjust to life without a full-time job. Keep this in mind as you look toward your personal retirement plan. Focus on your retirement the way you’ve focused on your work and the years ahead can be your best ever.


Maybe We Should Take Socialism Seriously

My Comments: To me, it’s both pathetic and amusing to hear political candidates rail against the idea of ‘socialism’ and declare it’s mankind’s greatest threat.

Like so many of the ‘…isms” applied to economic models of all stripes, socialism is no more a threat to the health and welfare of any society than is capitalism or communism. Well, maybe communism, but certainly not capitalism.

Unfettered capitalism, as some would have it today, is not far from the feudalism of long ago in that the masses would be under the thumb of a wealthy elite whose only motivation is the preservation of their power. Does any of that sound familiar to you?

by Noah Smith \ October 26, 2018

When President Donald Trump’s Council of Economic Advisers released a 55-page report called “The Opportunity Costs of Socialism,” many economists scoffed. But the report is important, because it shows that big, systemic economic issues are again being considered. And it provides an interesting jumping-off point for those important discussions.

Two decades ago, it seemed as if capitalism had decisively won the battle of ideas. The collapse of the Soviet Union and the grinding poverty of Mao’s China and communist Vietnam and North Korea clearly demonstrated that the most extreme versions of socialism were disastrous. But even in non-communist countries, attempts at regulation, nationalization and redistribution suffered big setbacks. The License Raj, a system of heavy-handed business regulations in India, was repealed, and the country’s growth leapt ahead. Privatizations and other market-oriented reforms in the U.K. helped the British economy make up ground it had lost. Sweden made its fiscal system much less progressive, and North European countries deeply reformed their labor market regulations.

But as inequality of income and wealth steadily rise in countries like the U.S., and as populism and political discontent roil nations across the globe, some are beginning to question the consensus that emerged at the end of the Cold War. Polls show an increasing number of young Americans responding favorably to the word “socialism”:
Openly socialist candidates are starting to win a few elections in the U.S., and calls to end capitalism are starting to appear in the mainstream news media with increasing frequency.

The CEA’s new report should be seen in this light. It’s an indication that both socialism’s proponents and its opponents have begun to take the idea seriously again. With the world troubled not just by inequality but also by productivity stagnation and the threat of climate change, it’s time to ask whether there are big systemic improvements that could be made.

The CEA report shows just how long it has been since such a discussion was held. A key explanation of socialism is taken from “Free to Choose,” a 1980 book by Milton and Rose Friedman. The economics profession has shifted decidedly to the left since those days, but most economists now concern themselves with highly specific topics rather than the grand sweep of political-economic systems. The people spending their time thinking about socialism, capitalism and other really big ideas are now more likely to be the writers of Teen Vogue or activists on Twitter. Let’s hope the CEA report will prod more economists, who tend to have more empirical knowledge and theoretical depth, to think bigger.

But although it’s an important conversation starter, the report doesn’t do a good job of comprehensively debunking socialism in all its forms. Some of the examples it invokes are particularly inapplicable to the modern day, and it overlooks much of the evidence in favor of an expanded role for government.

For instance, the report highlights collectivized agriculture as a prominent example of a socialist failure. Collectivized farming is indeed a disastrous policy, failing essentially everywhere it has been tried, and leading to widespread famine and death. But modern-day socialists in Western countries are — wisely — not calling for this. Instead, the industries they want to nationalize are health care and (possibly) finance.

Socialized health insurance exists in many countries — for example, France, Canada, and Japan. The costs and benefits of government health insurance systems don’t have to be assumed — they can be observed. The U.S., with its unique hybrid of public and private insurance, pays much more than other rich countries for the exact same medical services — and achieves similar health outcomes. Meanwhile, the U.S. biggest government health insurance system, Medicare, holds down prices much more effectively than its private counterparts:

A Death Blow To An American Industry

oil productionMy Comments: I rarely post on the weekend, but since it’s August and many of us are driving somewhere for a few days, this seems relevant. It’s mostly about the money we pay for gas these days at the pump. But there will be significant ripples across the planet as this plays out.

While a roomful of economists will have totally divergent ideas, Harry Dent is the one who predicted the DOW at 20,000 some 20 years ago. He has a very solid resume. As for me, I’d just as soon pay less to fill up the car and worry about something else these days.

Aug. 7, 2015, by Harry Dent


  • Why oil’s bounce will not be as big this time around.
  • The impact QE has had on the oil industry.
  • More about the greater global slowdown that lies ahead.

Oil is on a course to test its $42 lows from March, as I’ve said it would. And the way it’s been falling lately, I wouldn’t be surprised if it happens in the next couple of weeks.

There are several ramifications to this. In the long term, it will devastate the global economy as shrinking demand wipes out oil players and oil jobs around the world. But in the short term it will affect the U.S. more — possibly more than any other country — striking a death blow to the fracking industry, specifically because it’s become such a staple of our bubble economy and recovery.

Many are quick to think that since oil bounced back in recent months it will do so again. We did say it would bounce, and it did just that — bouncing back to $63, right in our target range of $62 to $74. But I don’t expect it to bounce for long this time around. John Kilduff from Again Capital shares our view. That’s because the world is quickly becoming a different place. The bubble euphoria investors have enjoyed since 2008 is showing several signs that it cannot continue.

And since the fracking industry is one of the highest cost producers and nothing more than a mirage created by QE economics, it might well be one of the triggers for what could become the greatest crash of our lifetime. Fracking had been around for a while before it really took off in the last decade. Its large upfront costs had made it impossible for it to become a leading player in the oil industry.

But the zero-interest rate policies launched by the Fed and other central banks suddenly caused junk bonds to drop to more affordable levels. Yields that were once 10% fell to 5.5%. So the frackers swooped in, jolting their industry forward like a shot straight to the heart.

Along with the global economy, QE propped up the oil industry — lifting it off its 2008 low of $32 (which would’ve been much lower if QE hadn’t come into the picture) to the early 2011 high of $115. Fracking could exist in that environment. At today’s prices, it can’t.

I don’t know how else to say it — without QE, it’s a mirage. An illusion. Totally artificial. And like the trillions that are about to disappear from the world, it’s like magic. Now you see it, now you don’t.

The way oil prices are falling — and the way the global economy is displaying greater signs of weakness — you can bet that fracking is doomed! Its breakeven cost is around $65 — and between $55 and $80 for most producers. That’s to say nothing of profits and long-term sustainability as a business! With oil below $42, frackers have no hope, and a mountain of debt they can’t repay.

Beyond that, there are two key reasons oil will not return to the more profitable mark of $80-plus for at least a decade. Kilduff and I agree here as well. There is no government or central bank supporting the fall of oil like they are stocks and bonds. Saudi Arabia, the largest producer that also pumps oil the cheapest, is hell-bent on wiping out its competition by churning out more and more oil to feed the supply glut.

They will stop at nothing to achieve this — and since they don’t see the huge falloff in demand ahead that we see globally, the Saudis will keep pumping even at the expense of their own government budget. The other reason is that when all this global stimulus starts to unravel, demand for oil will fall at an unexpected rate. We’re talking $30 by Christmas time, as Kilduff said on CNBC Squawk Box recently. I’ve been saying $32 by late January, but John is the ultimate expert in this sector.

That said, it’s very possible and likely that oil could bounce after touching a $30 to $32 bottom in the months ahead — once fracking stops adding to the supply glut. You’d be surprised just how big a contributor this industry has been to this bloated oversupply in oil. Just look at how many rigs belong to fracking or “horizontal” drilling:

That should make it very clear that the death of fracking will wipe away most of the oil supply and return it to more ordinary levels. And it will crush the American energy industry. But the larger issue is what follows: a greater global slowdown that’ll unfold in the latter part of this decade. That will absolutely crucify global demand for oil!

Governments won’t see this coming — not ours, not Saudi Arabia’s. Central banks will be kidding themselves if they so much as try to stop it. They can’t buy oil with any credibility as they have their own “safer” bonds. This is one free market force that will shoot to kill.

10 Helpful Tips About Medicare

My Comments:retirement-exit-2 Medicare has been a life saver for me and my wife. It has allowed us to seek timely and appropriate medical care when problems surfaced.

An argument can be made that it serves to deprive hard working physicians with the compensation they deserve, but from a selfish perspective, that’s their problem.

Our problem was to find medical answers and find them NOW because the alternative was likely to be dramatic. Maybe not fatal, but… We are able to do this without leaving a financial pall hanging over us. Some people will take unfair advantage of this and perhaps abuse the system. But no one covered by Medicare should avoid timely advice from healthcare providers.

When you couple Medicare with a good supplemental, private health insurance plan designed to cover what Medicare will not cover, you are golden. And alive for a while longer, hopefully enjoying what life has to offer.

by Ann Marsh / AUG 13, 2014

SAN DIEGO — The average couple, at age 65, is likely to need $261,000 to cover all their health care costs for the balance of their lives — and those are just out-of-pocket costs, not those covered by Medicare. To make matters worse, health care costs overall are rising at about 5.8% a year.

Those details emerged during a presentation at LPL Focus in San Diego this week. Joe Moklebust, director of business development at Principal Financial Group, urges planners at the large independent broker-dealer’s annual conference to pay close attention to how and when their clients enroll for Medicare.

Failing to heed certain deadlines for enrollment and failing to evaluate plans can substantially affect clients’ financial lives, Moklebust says.

One audience member’s own experience illustrated the point. The advisor told the room that he has a medical condition and can’t buy generic versions of the medications he takes.

When it came time to sign up for Medicare Part D, which covers prescription drug medications, he says he and his insurance agent reviewed numerous plans to see how each one would handle his prescription drug needs. Some would not have covered them, he told Moklebust.

“If I were to buy my medications outside, it would be about $1,100 a month,” he said — adding that, with the plan he chose, “It costs me about $300.” That is a big issue for seniors, the planner said.

Moklebust concurs: “They do not investigate the plans,” he said. “It is costing them more money because they do not.” Moklebust offers advisors a series of tips for clients’ Medicare enrollment and usage.


• At 65, the mandatory age when Medicare starts (with exceptions), clients must enroll in the window that starts three months before their birthday month and ends three months afterward. If they don’t, penalties may apply. If those clients are still working and covered by their employers’ qualified group health insurance plans, they can delay. But some people who are laid off and get COBRA coverage make the mistake of thinking that they can wait to enroll in Medicare until after their COBRA period — sometimes as long as two years — has ended. That is not true. “If you don’t sign up within the prescribed enrollment period,” Moklebust says, “for each 12 months when you were eligible and not covered by a group plan, your Medicare part B premium is going to go up 10%. And it will stay up 10% for the rest of your life.” Planners should refer clients who are still working to their employer’s benefits administrator for more detailed information, Moklebust says.

• Clients who are 65 and older but working, with qualified medical plans through their work, may not be ready to enroll for Medicare — but in most cases they should still enroll in Medicare Part B.

• Medicare A and B plans are standardized at the federal level. But Medicare Advantage plans, also known as Medicare Part C, are localized. They can vary greatly in quality not only between states, but also within states — so it pays to shop around.

• If clients are enrolled in Medicare Parts A and B but want additional coverage — for deductibles and co-pays, or for travel abroad — they may wish to add a supplemental Medigap plan. The most common is Medigap Plan F.

• Medicare costs break down as follows: Medicare part A is free unless your client isn’t fully eligible; in that case it can cost as much as $441 a month. The base cost for Medicare part B is $104.90 monthly, although it can range up to $335.70 for wealthier clients. Medigap insurance varies in cost by carrier and by health status, but the average cost ranges from $60 to $200 a month, depending upon what type of plan a client wants. Medicare Part D costs about $40 a month and may carry additional costs for wealthier clients.

• Windfalls from the sale of a home or a large severance can push a client’s Medicare costs into an artificially high bracket. But those higher charges can be appealed and, in some cases, reduced.

• Medicare Part D, the prescription drug coverage, comes with a “donut hole,” which is a gap in coverage. After clients satisfy their deductibles, they then pay a percentage of their prescription drug costs up to $2,850 a year. After that point, they must cover all these costs until they hit $4,550, after which point the insurance kicks in again. While in the “donut hole,” clients receive full credit for the cost of the medication but the actual cost is reduced by 28% for generics and 52.5% for name brands. Under the Affordable Care Act, however, that donut hole is shrinking. By 2020, it is expected to be closed.

• In some cases, clients will need to change their Medicare Advantage coverage if they move.

• Enrolling in a Medicare Advantage plan may require working with insurers’ PPOs or HMOs, which have their own doctors and hospitals. If your clients want to use their own doctors, advise clients to check to see whether those offices will accept original Medicare.

• If clients under age 65 are receiving Social Security disability insurance, they must have been disabled for two years before they can begin receiving Medicare.

Overall, Medicare covers about 51% of most older Americans’ annual health care costs, Moklebust says. To help clients get the most out of their coverage, he urged planners to go on the Medicare.gov website and get the Medicare & You handbook covering basic details of all Medicare plans.

Obamacare Helps Add Life to Medicare as Shortfall Delayed

healthcare reformMy Comments: I’ve argued vigorously over these past few years in favor of the PPACA, what all of us know as ObamaCare. Without it we would be at the mercy of the drug industry, hospitals and the insurance industry. Of the five primary stakeholders in the health care debate, any two of those three could have the necessary leverage to reverse the rising tide of cost increases we had been living with for decades or they could sustain it.

That the rising tide is still visible is not a surprise. If our elected leaders in Congress had spent the last few years working to improve the PPACA instead of blindly working to repeal it, the cost savings might already be apparent. Sooner or later is will be obvious. Just look at Kentucky as an example.

As for the drug companies, hospitals and insurance companies, in my mind its doubtful their solution would be in our best interest as citizens and patients. Most likely their solution would be one that serves the best interest of those industries. That’s how free enterprise works. So what happened is we, as one of the five stakeholders, stepped up and said it’s time to stop the rising tide and this is how it will be done.

As all of us know, it hasn’t happened smoothly or without adverse consequences. It’s going to take years for the hiccups to stop. It may never be a smooth running idea, if for no other reason than world economics and demographic forces will intervene along the way. But it’s better than the social chaos that would happen if the health care delivery system in this country collapsed of its’ own weight or became “owned” by the above mentioned industries.

This article suggests at least one measure of good news has surfaced in support of the overall goal. Some of our dilemma is driven by the need to introduce legislation where benefits will be seen long after the current leaders are dead and buried. That goes in the face of decision making that wants immediate results to encourage and justify being re-electied to office.

By Bloomberg News Service / July 28, 2014

The main trust fund behind Medicare, the $583 billion U.S. health program for the elderly and disabled, will be exhausted in 2030, four years later than projected last year, the government reported.

An improving economy and the health-care overhaul known as Obamacare may stave off depletion of the fund as it took in more money and spent less than expected last year. The trust fund pays for hospital visits, nursing care and related services for Medicare’s 52 million beneficiaries. Its assets fell $7.1 billion in 2013 to $281 billion, less than one-third the reduction of a year earlier, according to a report released today by the program’s trustees.

Medicare’s finances are a flash-point in health-policy debates between Republicans, who have proposed converting the program into private insurance subsidized by the U.S., and President Barack Obama. Unusually slow growth in the program’s spending, payment cuts under the Patient Protection and Affordable Care Act, known as Obamacare, and debt-reduction legislation have extended the life of the fund, called Part A.

“Medicare is considerably stronger than it was just four years ago,” Sylvia Mathews Burwell, secretary of the Department of Health and Human Services and a trustee for the program, said today at a news conference. “Cost growth is down. The quality of the care our parents and grandparents are receiving is improving.”

Spending Unchanged
Medicare spending per beneficiary, including outpatient services and prescription drugs that are paid for from separate trust funds that can’t be exhausted, was unchanged from 2012 to 2013. Spending per beneficiary under Part A — for hospital care and related services — fell for the second year in a row.

Growth in Medicare Advantage plans, offered by private insurers including Humana Inc. (HUM) and UnitedHealth Group Inc., accelerated. About 1.3 million people joined the plans in 2013, raising enrollment to 14.8 million, or 28 percent of all Medicare beneficiaries. About a third of Medicare beneficiaries are projected to be in the private plans by 2023.

Medicare’s actuaries, who compile the report, said that fewer people than they expected sought hospital care in 2013 and that those patients used less expensive services when they did. It remains unclear whether that is due to economic pressure on patients or to changing practices by doctors and hospitals, who have been encouraged under the Affordable Care Act to better coordinate their care and avoid unnecessary readmissions to the hospital.

Cost Questions
“The jury’s yet out as to whether we can really count on the pace of cost growth being reduced,” Doug Holtz-Eakin, president of the American Action Forum, an advocacy group that has opposed Obamacare, and a former head of the Congressional Budget Office, said in a phone interview. “My concern is this will take pressure off the Congress and the administration to deal with the real problem and we run the risk of a very bad surprise down the road.”

Social Security’s trust funds, used to make disability and retirement payments, will be exhausted in 2033, the same projection as last year, a second report said.

The program’s trustees, who include the secretaries of the Treasury and Labor departments in addition to Burwell, said payment reductions and productivity improvements under the Affordable Care Act can be sustained.

“The trustees are hopeful that U.S. health-care practices are in the process of becoming more efficient as providers anticipate a future in which the rapid cost growth rates of previous decades, in both the public and private sectors, do not return,” they said in the annual report.

Repeal Scenarios
Medicare spending would grow much faster if provisions of the Affordable Care Act that control cost growth were repealed, the trustees said. Under one “illustrative scenario” that included repeals of several provisions of the law, Medicare spending would consume more than 8 percent of gross domestic product by 2080, compared with just more than 6 percent under current law.

Obama has sought to keep the current structure of Medicare largely intact and allow changes wrought by his health-care law to take effect. In April, the Congressional Budget Office said the program would cost $1,000 less per patient than it had projected in 2010, the year the law was passed. Republicans have also lobbied to raise Medicare’s eligibility age to 67, a proposal Obama hasn’t ruled out as part of a larger budget deal that would include tax increases. Republicans have rejected any budget agreement increasing taxes.

“The president is ready to work with Congress on enacting responsible reforms, and he is prepared to make tough choices,” Treasury Secretary Jacob Lew said at the news conference. “The president will not support any proposal that hurts Americans who depend on these programs today and he will not support any proposal that slashes benefits for future retirees.”