 A new study finds that the cost-of-living for most California seniors far exceeds their incomes and the gap widens when long-term or personal care costs are added. Vickie Orr, retired and living in Bishop hides her face behind her $100 of weekly prescriptions. The cost is after insurance picks up its share of the bill. Photos by Mike Bodine By Mike Bodine
Register Staff
6-27-2009 The findings of a new study show that the average income for seniors in the state is not enough to cover basic living expenses. And, when long-term or personal care expenses are added, the costs are much more than the median incomes for seniors in all 58 California counties.
These findings are perhaps even more astounding given the study was conducted before the governor and legislators have finished cutting programs and services in next year’s budget that is sure to include even deeper cuts to senior services.
This June 2009 study, titled “Long-term care costs exceed yearly income for many California seniors,” suggests that seniors living in Inyo County are not faring any better than the rest of the state.
However, the cost-of-living/annual income discrepancy has not created an increased demand from local seniors seeking assistance, said Marilyn Mann, director of the Inyo Mono Area Agency on Aging.
“We’re not seeing a spike,” Mann explained, “but a constant demand.” She added that there are waiting lists for some of its senior assistance programs, but she said she didn’t think the poor economy and funding cuts have made their impacts felt yet, locally.
Some local seniors disagree as their Social Security benefits shrink, but rent, gas and grocery prices continue to rise.
Vicki Orr, who retired to Bishop more than 15 years ago, said that for her and her friends, finances are “not bad” but they’re having to be “very conservative” with spending.
“We don’t know what the future holds,” Orr said Friday.
This new study, conducted by The Insight Center for Community Economic Development in conjunction with the UCLA Center for Health Policy Research, provides a county-by-county breakdown of incomes and living costs through an Elder Standard Index on the Web site www.insight.org.
The Elder Economic Security Standard™ Index, or Elder Index, quantifies the actual costs of meeting basic needs and is, according to the center, “the only elder-specific financial measure of its kind.” The Index measures how much income is needed for seniors in different housing situations, different counties and health qualities, to meet their basic needs – without public or private assistance. The index estimates basic living expenses of those 65 years of age and older living in the community – not in institutions.
For Inyo County, the Elder Index, or median cost-of-living, ranges from $18,748 for a single-resident renter, to a single-resident paying a mortgage at $29,585.
However, the median retirement income of county seniors, according to the Index, is $17,170 for females and $17,294 for males. The average annual income for those receiving Supplemental Security Income, or SSI, is $10,272, a whopping $61 more than the Federal Poverty Level. The average Social Security income is $11,848 a year.
Due to privacy laws, the number of SSI or SS recipients in the county is classified. But, according to the U.S. Census Bureau, in 2007, approximately 16.6 percent of Inyo’s 17,136 residents are over the age of 65, or roughly 1,035 residents. The state’s average is 11 percent.
The UCLA study summarizes several points that are generalizations of seniors throughout the state, such as:
• The average SS payment “is not enough to live on, and yet, one out of three seniors in California rely exclusively on Social Security to cover their basic costs.”
• The average incomes of all senior women fall well below the Elder Index Standard in each category.
• Men are not doing much better. “They also can not meet their basic expenses regardless if they rent or own their home. Even if their mortgage is paid off.”
• Many seniors “fall through the cracks” in accessing public services that are supposed to help close the gap between seniors’ income and their expenses. The qualification to get this support “is based on an unrealistically low assessment of what it costs to live, the $10,210 Federal Poverty Line.”
• The SSI program which benefits the blind, aged and disabled is just above the Federal Poverty Level, “but far below what it really costs to make ends meet.”
The findings of the study explain that when the costs of long-term or in-home care are added to basic living expenses, they far exceed the median income for seniors in the entire state.
The UCLA Center has done a county-by-county study on these healthcare costs, commonly associated with those most vulnerable and with the lowest incomes, such as SSI recipients.
This study breaks down the cost of care into hours needed per week and price of the service per hour. For example, in Inyo County the average Personal Care attendant is $19 per hour, and case management is $45 per hour. So, a county resident receiving six hours of care per week, considered “low” need, will spend $6,786 per year, and added to the Elder Index cost-of-living, the total annual cost is $25,535. This is nearly 2.5 times the annual SSI income.
For a senior needing a “high” level of care, up to 36 hours per week, the annual cost is $57,434.
While a budget has not been passed as of press time, there are some leading indicators as to where the cuts for seniors will go.
In the Budget Conference Committee Report on June 16, the committee makes several recommendations concerning proposed cuts.
The committee’s recommendations are:
• Adopt the proposal to increase long-term care fees for an additional $18 million in revenue and reduce long-term care rates for a savings of $75.7 million General Fund.
• Reject the proposal to eliminate Adult Day Health Care benefits and adopted reforms to ADHC programs including a temporary three-day cap, workgroup and minimum standards on medical necessity, on-site Treatment Authorization Requests, and anti-fraud measures for approximately $25 million in General Fund savings.
• Reduce General Fund support for the Alzheimer’s Research Centers of California by 50 percent, from $6.2 million to $3.1 million.
• Reduce SSI/SSP grants for couples to the federal minimum, pursuant to the governor’s proposal, and reduces grants for individuals by $5 per month to save $155 million on an annual basis. This reduction is effective Oct. 1, 2009 – just in time for the expensive, winter heating season.
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