Most people agree the upcoming November election is one of the most contentious and consequential in modern history. The outcome of the 2020 election could shape policies affecting older Americans for years to come.
People 55 and over have traditionally been the largest voting bloc, giving them outsized influence in national politics. Core issues such as Medicare, Social Security, prescription drugs, and the economy are all on the ballot this year. With the stakes so high, it’s important to know where the candidates stand before you cast your vote.
Over 60 million Americans are covered by Medicare. According to projections by the Congressional Research Service, Part A is currently operating at a deficit and the entire Medicare program will be insolvent by 2026. Most experts believe the COVID-19 pandemic will accelerate Medicare’s ailing finances. The winning candidate will face significant financial headwinds keeping the program afloat.
After four years in office, President Trump has a public record of actions affecting Medicare. By reviewing those actions, as well as his 2021 budget proposal, Trump’s stance on the future of Medicare becomes clear.
The president has promised to protect Medicare and make no substantive changes to coverage or eligibility requirements. Instead, the Trump administration has worked to promote competition and reduce regulatory burdens to lower costs and increase choice for Medicare beneficiaries. As a result, average Medicare Advantage premiums have gone down and the average enrollee has access to nearly 50 different Medicare plans, a sizable increase over 2016.
Trump’s Department of Health and Human Services has also moved to expand benefits in Medicare Advantage. The new benefits include universal access to telehealth, remote health monitoring, and services to help seniors age safely at home.
The president’s 2021 budget proposal contains $50 billion a year in Medicare spending reductions over the next 10 years, which some suggest might come at the expense of coverage. However, a closer look at the numbers shows that savings are achieved by equalizing payments to providers for outpatient care, a move recommended by the Medicare Payment Advisory Committee. Further reductions come from reforming prescription drug pricing and limiting Medicare’s liability for paying beneficiaries’ uncollectible deductibles and cost-sharing payments.
These changes would affect providers, not beneficiaries, and are aimed at shoring up Medicare’s ailing finances.
The Trump administration has been adamant in its opposition to the Affordable Care Act, which directly affects Medicare beneficiaries. If the administration is successful in dismantling the ACA, seniors would no longer pay nothing for certain preventive services; normal Medicare cost-sharing would apply. In addition, the prescription drug donut hole would return.
Trump is against Medicare for All and lowering the age of Medicare eligibility, citing the cost strain on the program’s weakened finances.
Vice President Biden has a different vision for Medicare. A Biden administration would expand Medicare enrollment by lowering the age of eligibility to 60, giving 20 million more Americans access to the program. The $20 billion a year price tag for Medicare expansion would be paid for by premiums and general revenue.
Biden also supports expanding Original Medicare to include benefits for vision, dental, and hearing, coverage currently only available with Medicare Advantage plans.
He strongly backs strengthening the Affordable Care Act. A future Biden administration would not roll back the free preventive care benefits included in the ACA. The prescription drug donut hole would also remain closed.
While Biden says he is against the Medicare for All proposal favored by a majority of Democrats, he does support a Medicare-like public option. The public option would be available to everyone, including the uninsured, individuals covered by less comprehensive employer plans, and undocumented immigrants. Many supporters believe the public option may open the door to single-payer health insurance over time.
According to the Kaiser Family Foundation, nearly 30% of Americans have not taken their medications as prescribed at least once during the last year due to cost. Prescription drug costs consistently rank among the top concerns of American seniors.
The president made Medicare drug costs an early focus of his presidency. His administration aimed to lower costs by increasing competition and boosting its negotiating power with drug manufacturers. As a result, Part D premiums have gone down year over year and the number of available plans has increased by 35% since 2017.
The Trump administration worked directly with drug manufacturers to secure discounts on prescription drugs. Trump signed waivers for individual states to negotiate contracts with drug companies to lower Medicaid costs. His Department of Health and Human Services also implemented a rule allowing importation of cheaper drugs from Canada with appropriate health safeguards.
In September, Trump signed an executive order extending “most favored nation” status to Medicare. Under the executive order, Medicare will pay no more for prescription drugs than other developed countries that typically pay less than the U.S.
Trump also expanded the use of rule 340B, the federal drug discount program, to apply to insulin. As a result, most Medicare beneficiaries covered by a Part D plan will pay no more than $35 for insulin at all stages of coverage.
The president’s 2021 budget proposal includes capping out-of-pocket prescription drug spending for Medicare beneficiaries covered by Part D, lowering costs by expanding the number of available generic drugs, and increasing drug company rebates.
Vice President Biden has laid out a detailed plan for lowering the cost of prescription drugs for Medicare enrollees. In addition to allowing Medicare to negotiate directly with drug manufacturers, Biden proposes to bar manufacturers from raising drug prices beyond the annual rate of inflation.
While the Trump plan includes this provision, it only applies to generic drugs covered by Part B. The Biden plan extends the price cap to Medicare Part B and Part D and the public option plan. It also applies to biologics and specialty drugs as well as generics.
Biden’s plan establishes an independent review board that would determine reasonable prices for new drugs as they come to market. It would also eliminate the tax break to drug manufacturers for advertising expenses.
The Biden-Harris platform supports allowing Medicare beneficiaries to purchase prescription medications from other countries.
Although Social Security isn’t technically “going broke,” it is facing serious funding challenges. By 2035, the program’s $3 trillion surplus built up over decades will be exhausted. Unless it is reformed, Social Security will only be able to pay 79% of scheduled benefits. Federal law prohibits Social Security from paying benefits if there is not sufficient revenue. Here’s where the candidates stand on Social Security.
President Trump has promised to protect the Social Security program as currently constituted. However, his 2021 budget does include $35 billion in cuts over 10 years to the Social Security Disability Insurance program (SSDI). The savings would come from reducing the retroactive payment period from its current 12 months to six months. The president’s budget would not affect retiree benefits, however.
President Trump has also suggested eliminating the payroll tax, which funds about 90% of Social Security, if he is re-elected. Instead, he would fund the program with general revenues, although the plan is light on details.
Of note: Neither President Trump nor Vice President Biden can make unilateral changes to the Social Security program. Congress must pass legislation to change any aspect of Social Security.
Biden's plan for Social Security includes expanding the program to provide a minimum benefit of 125% of the poverty level for everyone who has worked at least 30 years, regardless of wages. This “true minimum benefit” would increase Social Security payments by about $6,500 a year to those at the lower end of the benefits scale.
Biden’s plan also includes expanding the 12.4% Social Security tax to salaries in excess of $400,000, and gradually narrowing the gap over 30 years so that all wages are subject to the tax. The tax currently applies to the first $137,700 of salary.
Before the COVID-19 pandemic, unemployment hit all-time lows, earnings were steadily increasing for those at the lowest income levels, and the stock market posted historic gains.
During the pandemic, unemployment reached 14.7% and the stock market plunged, wiping out $1.7 trillion in wealth. While the stock market is back on the upswing, the unemployment rate still hovers at nearly 8%. The next president will need to chart a path to regrow the economy and secure the country’s future.
President Trump’s economic plan focuses on cutting taxes and government regulation to spur growth. His 2017 Tax Cuts and Jobs Act lowered the corporate tax rate from 35% to 21% and the top individual tax rate from 39.6% to 37%. His Tax Cuts 2.0 plan includes further slashing the corporate tax rate to 15% and reducing middle-class tax rates by 10%.
Trump supports an “America First” trade agenda. He imposed tariffs on countries that have penalized American goods and initiated a trade war with China over its trade practices and intellectual property theft. The Trump administration replaced NAFTA with the new United States-Mexico-Canada agreement in an effort to bring manufacturing jobs and investment back to the U.S.
Trump also supports a “Buy American, Hire American” policy that limits immigration, including skilled workers under the H-1B visa program. While he does not support a federal minimum wage, he does support states passing higher minimum wage laws.
Throughout his term, President Trump lobbied Congress to pass a $1 trillion infrastructure bill to repair and modernize highways, bridges, and airports and bolster job creation. So far, however, no bill has materialized.
In 2020, Trump signed four COVID-19 relief and stimulus bills totaling nearly $3 trillion. As a result, the budget deficit is expected to exceed $3 trillion by the end of the year.
Biden’s economic plan repeals most of the tax cuts passed by Trump. His plan would restore the maximum individual rate to 39.6% and increase the corporate rate to 28%. He would also limit itemized deductions, including charitable giving, to 28% of value. The current long-term capital gains tax rate of 23.8% would jump to 39.6%.
The nonpartisan Penn Wharton Budget Model projects the Biden plan would increase tax revenue by $3.375 trillion over 10 years.
Biden supports a $2 trillion climate change-focused economic plan. A Biden administration would invest heavily in clean energy to achieve net-zero emissions and provide zero-emissions public transportation to all American cities.
Other provisions of the plan include constructing 1.5 million sustainable homes and upgrading 4 million buildings and 2 million homes to improve energy efficiency. These policies are expected to create up to 10 million new clean energy jobs.
Biden supports a $15 federal minimum wage. He also plans to expand immigration and remove the Trump administration’s limits on employment-based visas.
The Penn Wharton model projects that Biden’s economic and health care plans would increase spending by $5.37 trillion over 10 years.
Over half of all Americans turning 65 will need long-term care at some point in their lives; 53% of them will need more than a year of care. Given that a year of nursing home care can cost $100,000 or more, paying for long-term care is a top concern for older voters.
In 2019, the Trump administration formed a task force to study ways to improve affordable access to long-term care.
The ideas under consideration include expanding access to hybrid life insurance/long-term care insurance policies and annuities, and disability policies that convert to long-term care policies at age 65. The task force also looked at tax deductions and penalty-free 401(k) and IRA withdrawals for the purchase of long-term care insurance.
The task force has not released a comprehensive plan, but it supports an initiative that would allow long-term care insurers to pay for home modifications and caregiver training to help seniors age safely at home and postpone or eliminate the need for long-term care.
Trump’s HHS also approved expanded Medicare Advantage benefits for adult daycare, respite care, and temporary in-home custodial care to help seniors avoid long-term care placement.
The Biden plan includes a $5,000 tax credit for caregivers modeled on legislation proposed by AARP. It also supports tax breaks for the purchase of long-term care insurance.
As president, Joe Biden would also enact the Caregiver Advise, Record, Enable (CARE) Act which would better equip caregivers to support loved ones recently discharged from the hospital.
No matter who wins in November, the next president will be responsible for solving many complex issues. Both Medicare and Social Security are facing funding challenges made worse by the COVID-19 crisis and the economy has yet to fully recover.
President Trump’s record suggests that he would continue his market-based approach for solving the financial issues facing Medicare, prescription drug prices, the economy, and long-term care. Biden’s plan promotes a government-centric approach with more federal funding and control of major social programs.
The good news is that both candidates recognize and have a plan for the issues that concern older adults. It’s up to voters to decide which plan makes the most sense for themselves, their families, and the future of the country.
Sheila Olson has over two decades of experience writing about Medicare, health, and personal finance. Her work has been featured on sites such as Investopedia, The Motley Fool, and Boomer Benefits. Sheila holds a MPH (Master of Public Health) from Northern Arizona University.
For more information on how, when, and where you can vote this year visit usa.gov/how-to-vote. You can also head to vote.org to find your nearest polling place, request an absentee ballot, verify your registration status, and even get election reminders (so you never miss an opportunity to have your voice heard).