But Employer Payroll Tax Credits Could Harm Social Security
Older Americans will receive urgently-needed financial and medical assistance from the Coronavirus Aid, Relief and Economic Security (CARES) Act. This legislation goes a long way toward helping America’s most vulnerable population – seniors – to survive the COVID-19 crisis. The historic relief package ensures that seniors will receive cash stimulus payments and expanded Medicare benefits as well as emergency supports for skilled nursing facilities and caregivers.
“At a time when some have outlandishly suggested that seniors be ‘sacrificed’ for the greater good, the CARES Act affirms that government will do its level best during this crisis to protect the older generations who have given so much to us — and to the life of this nation. This aid package will help keep our seniors safer, healthier, and more financially secure in their daily lives as we struggle to bring COVID-19 under control.” – Max Richtman, National Committee president and CEO.
The National Committee applauds several of the CARES ACT provisions targeted to older Americans, including, but not limited to:
Assurances that Social Security beneficiaries can receive cash rebates ($1,200 for individuals and $2,400 for couples) like millions of other Americans, even if they have not filed income taxes for 2018 or 2109.
Enhanced flexibility for Medicare and Medicaid to cover care and supports for seniors during the pandemic, including telehealth coverage for patients who can’t visit a doctor.
Extra funding for the Center for Medicare and Medicaid Services to assist nursing homes with infection control and to help states prevent the spread of COVID-19 in nursing homes.
Enabling the Medicare Part D prescription drug program to provide Medicare beneficiaries with a three-month supply of medications.
An extension of community-based long-term care spousal impoverishment protections and the Medicaid “Money Follows the Person” Program (a demonstration that helps patients transition from institutional care to home and community-based care).
$955 million for Older Americans Act and disability services programs, including senior nutrition, home and community-based supportive services, and family caregivers.
$900 million to support immediate home energy assistance for low-income households affected by the coronavirus.
While we wholeheartedly endorse these and other aspects of the CARES Act, The National Committee strongly cautions against provisions that will:
Provide employers with a payroll tax credit for retaining their employees.
Allow employers to stop paying into Social Security on behalf of their workers for the rest of the year — with a requirement to repay those funds in 2021 and 2022.
Social Security already provides more than $1.6 trillion in annual economic stimulus as seniors spend their benefit checks on essential goods and services. Cutting or deferring payroll taxes weakens Social Security, because it deprives the program of revenue from employer contributions. Backfilling lost payroll contributions using general federal revenue, as the CARES Act would do, undermines the earned right benefit nature of the program, opening the door for privatization or future benefit cuts that will hurt seniors.
“Though we strenuously object to using payroll taxes for anything other than Social Security, we will hold Congress accountable for ensuring that the employer payroll tax credit and deferral are not extended. In addition, we don’t want to hear so-called ‘fiscal hawks’ say that Congress should cut seniors’ already modest Social Security and Medicare benefits to pay for the $2 trillion relief measure being signed into law today.” – Max Richtman