Proposed changes to the way Social Security benefits are paid—part of President Barack Obama's plan to help balance the budget—will lower what seniors receive at a time they can least afford it, said Robert H. Frank, professor of economics at Cornell University.
"It's hard to see this as humane," Frank said. "Seniors are facing hardships economically with cost-of-living increases, especially in health care."
What's on the table from Obama is a revised adjustment in cost-of-living formulations. The new measurement is called "chained CPI." [...]
Insurance premiums continue to rise much faster than the 2 percent rate of overall inflation. In 2011, average premiums rose 8 percent for individuals and 9 percent for family coverage, according to the Kaiser Family Foundation.
"If anything, the chained CPi underestimates the amount of inflation," Frank said. "With higher medical costs and a lack of real pension plans for seniors, they are at a major disadvantage."
The National Women's Law Center said chained CPI would be particularly onerous for women. Thirteen percent of women between 65 and 69 rely on Social Security for all their income, versus 10 percent of men, according to the center.