THE HENRY J.

WAU) sx
aw tIB4

FOUNDATION

REPORT

Wide Disparities

Tim daCem cK e Weer
oy Ce) LCM em Let (rela
by Race and Ethnicity

 

NOW AND IN THE FUTURE

September 2013

 

 
THE HENRY J.

FOUNDATION

Wide Disparities in the Income and Assets
of People on Medicare by Race and Ethnicity

eA eel

September 2013
dd hed)
Gretchen Jacobson
caer 4
steca eC a
Program on Medicare Policy
The Henry J. Kaiser Family Foundation

and

eT mT
The Urban Institute

 

 

The authors gratefully acknowledge the assistance of Dr. Cara James in preparing this report. Dr. James is currently
the Director of the Office of Minority Health in the Centers for Medicare and Medicaid Services (CMS). Prior to working
at CMS, Dr. James was employed at the Henry J. Kaiser Family Foundation and contributed to the preparation of this
report. The opinions expressed in this report are the authors' own and do not reflect the view of CMS, the Department
of Health and Human Services, or the United States government.

 

 

 
EXECUTIVE SUMMARY

People on Medicare, including seniors and younger adults with disabilities, often live on fixed incomes supplemented
by the savings they accumulated during their working years."? A person's ability to build wealth depends on many
factors, including their education, health status, marital status, number of work years, household income, periods

of unemployment, years of homeownership, access to employer retirement benefits, inheritance, and other financial
supports. These financial experiences for individuals during their working years differ by race/ethnicity, which in
turn leads to differences across race/ethnicity in income and wealth in retirement.?*

Many people on Medicare live on limited incomes, and have relatively modest savings and home equity.' In 2012, half
of all Medicare beneficiaries had less than $22,500 in income and half had less than $63,100 in savings.° Further, the
outlook for the next generation of Medicare beneficiaries is not expected to be much brighter. The increase in Social
Security's full retirement age from 65 to 67 means that Social Security will replace a smaller portion of the income of
future seniors claiming benefits at the same age as current seniors. The historic shift from defined benefit pensions
to defined contribution pensions means that fewer future Medicare beneficiaries will have guaranteed, defined
benefit pension income from former employers, and more will rely on less secure sources of income, particularly

if investments in employer-sponsored defined contribution plans (e.g., 401K plans) are tied to fluctuations in the
economy and stock market.' Between 1988 and 2012, the share of employers that offered retiree health benefits fell
from 66 percent to 25 percent.® If this trend continues, fewer future Medicare beneficiaries will have retiree health
benefits and more will be responsible for paying Medicare premiums and out-of-pocket costs. Furthermore, rising
budget deficits will increase pressure to reduce spending, increase taxes, or both. Numerous deficit reduction packages
have included reductions in Medicare spending and Social Security benefits, and increases in out-of-pocket health
care costs for Medicare beneficiaries, which could further erode the economic security of many vulnerable Americans.

 

This report includes important distributional
White Medicare beneficiaries had higher median incomes

information about the means of current and and savings than black and Hispanic beneficiaries in 2012

future Medicare beneficiaries. It updates

 

: : : Median income ) Median savin
and complements our prior work in this area per capita od edian aa és
by focusing on differences in the income $85,950

and assets of people on Medicare by race/
ethnicity, using data from the DYNASIM
microsimulation model developed by

   

 

 

 

researchers at the Urban Institute. A table $24,800

_ . $15,250 $13,800 $11,650 $12,050
summarizing the income and assets of
Medicare beneficiaries in 2012 and 2030, White Black Hispanic White Black Hispanic
by selected demographic characteristics, is Median = $22,500 Median = $63,100
inclu de d in Table Ai Data are roun de d to the among all beneficiaries among all beneficiaries
nearest $50 and are presented on a per person SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

basis, rather than per household; for married

people on Medicare, income and assets are divided equally between spouses to calculate per capita income, savings,
and home equity. More information about the methodology can be found in the Appendix. This analysis provides
new information about disparities in incomes and assets among the Medicare population by race and ethnicity to inform
ongoing discussions about potential changes to Medicare, Medicaid, Social Security and other policy proposals that could
have important implications for the economic security of current and future Medicare beneficiaries.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
KEY FINDINGS

INCOME AND ASSETS AMONG MEDICARE BENEFICIARIES IN 2012, BY RACE/ETHNICITY

» Half of all Medicare beneficiaries had annual incomes below $22,500 in 2012; median income was considerably

lower among black and Hispanic Medicare beneficiaries ($15,250 and $13,800, respectively) than among white

beneficiaries ($24,800).

- While the top 10 percent of black and Hispanic beneficiaries had incomes above $43,900 and $44,550,

respectively, the top 10 percent of white beneficiaries had incomes above $70,000 in 2012.

- Even among Medicare beneficiaries with a college degree, median income was substantially lower among

black and Hispanic beneficiaries ($29,200 and $34,800, respectively) than among white beneficiaries

($41,400).

» Nearly all (92%) Medicare beneficiaries had some savings (such as retirement account holdings and other

financial assets), but rates were higher among white beneficiaries (95%) than among black and Hispanic

beneficiaries (80% and 81%, respectively) in 2012. In other words, about one in five black and Hispanic

beneficiaries had no savings or were in debt.

- Half of all beneficiaries had less than $63,100 in savings in 2012; median savings for white beneficiaries

($85,950) were more than seven times the median savings for black beneficiaries ($11,650) and Hispanic

beneficiaries ($12,050).

- Among beneficiaries with savings, half had less than $77,500 in savings in 2012; median savings for white

beneficiaries ($95,900) were nearly five times the median savings for black beneficiaries ($19,700) and nearly

four times the median savings for Hispanic beneficiaries ($25,150).

» The majority (78%) of Medicare beneficiaries had some home equity, but the share was lower among black and

Hispanic Medicare beneficiaries (61% and 60%, respectively) than among white beneficiaries (83%) in 2012.

- Among beneficiaries with home equity, half had less than $93,850 in home equity in 2012; the median

home equity values were substantially lower among black and Hispanic beneficiaries ($53,650 and $67,700,

respectively) than among white beneficiaries ($100,200) in 2012.

PROJECTED GROWTH IN INCOME,
SAVINGS, AND HOME EQUITY, BY
RACE AND ETHNICITY, 2012-2030

» In 2030, median incomes for black and
Hispanic beneficiaries ($19,000 and
$18,100, respectively) are projected to
be substantially lower than for white
Medicare beneficiaries ($32,800), in
inflation-adjusted 2012 dollars.

 

 

Median incomes for black and Hispanic Medicare beneficiaries are
projected to be much lower than for white beneficiaries in 2030

2012 median income
per capita (in 2012 dollars)

2030 median income
per capita (in 2012 dollars}

 

 

$24,800

 
 

$15,250 $13,800

White Black Hispanic

Median = $22,500

among all beneficiaries

SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

$32,800

 
  
  
  

  

$19,000 $18,100

White Black Hispanic

Median = $28,600

among all beneficiaries

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

 
» Savings rates, and median savings, are
projected to rise for white, black, and
Hispanic beneficiaries so that by 2030,
a higher share of each racial/ethnic
group will have some savings.

- However, median savings for
white beneficiaries ($147,050) is
projected to be more than four
times higher than for black and
Hispanic beneficiaries ($34,250 and
$35,700, respectively) by 2030, in
inflation-adjusted dollars. Median
savings among those with savings
is projected to be more than three
times higher for white beneficiaries

 

 

Median savings for white beneficiaries is projected to be
more than four times the median savings for black and

Hispanic beneficiaries in 2030

2{_9 2012 median savings
=" per capita (in 2012 dollars)

»{__) 2030 median savings
=" per capita (in 2012 dollars)

 

$85,950

  

$11,650 $12,050

White Black Hispanic
Median = $63,100

among all beneficiaries

SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

$147,050

   
 
 
  
  

$34,250 $35,700

 

White Black Hispanic
Median = $108,350

among all beneficiaries

 

 

($156,650) than for black and Hispanic beneficiaries ($44,500 and $48,400, respectively) in 2030.

» In 2030, the share of white beneficiaries
with any home equity (85%) is
projected to continue to be higher
than the share among black and
Hispanic beneficiaries (67% and 65%,
respectively).

- Median per capita home equity
values, among beneficiaries with
home equity, are projected to be
substantially higher for white
beneficiaries ($119,050) than for
black and Hispanic beneficiaries
($58,850 and $73,650, respectively)
in 2030.

DISCUSSION

 

 

Median home equity values for black and Hispanic Medicare
beneficiaries are projected to be much lower than for white

beneficiaries in 2030
y IN 2012 median home equity

per capita, among homeowners
(in 2012 dollars)

7. 2030 median home equity
: per capita, among homeowners
{in 2012 dollars)

 

$100,200

    

   
  

$67,700

 
 

$53,650

White Black Hispanic
Median = $93,850

among homeowners

SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

$119,050

$73,650

   

 

$58,850

White Black Hispanic
Median = $107,100

among all beneficiaries

 

 

These findings present a sobering story. Building on prior research documenting modest income and assets for many
Medicare beneficiaries, with wealth concentrated among a very small share of the Medicare population, this analysis
reveals significant disparities in income, savings, and home equity among Medicare beneficiaries by race and
ethnicity. Looking to the future, the Medicare population of 2030 is projected to have somewhat higher incomes and
savings than the current generation, but at the median, the gains are predicted to be modest for the overall Medicare
population, especially for black and Hispanic beneficiaries. A clear understanding of the economic realities of the
Medicare population provides an important context for designing and assessing Medicare, Social Security, Medicaid
and other policy proposals that could strengthen or weaken the economic security of older Americans.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

 

 
SECTION 1: INCOME

This section describes the income of the Medicare population in 2012 across race/ethnicity. Income takes into
account Social Security, pensions, earnings, and other income sources, including income from assets, rental income,
and retirement account (IRA) withdrawals. Income is presented on a per person basis; for married people, income is
divided equally between spouses to calculate per capita income.

KEY FINDINGS:

» Half of all Medicare beneficiaries had annual incomes at or below $22,500 in 2012, with significant variation
across race/ethnicity. Median income in 2012 was lower for black and Hispanic beneficiaries ($15,250 and
$13,800, respectively) than for white beneficiaries ($24,800).

» The distribution of income for the Medicare population differed by race/ethnicity. While the top 10 percent of
black and Hispanic beneficiaries had incomes above $43,900 and $44,550, respectively, the top 10 percent of
white beneficiaries had incomes above $70,000 in 2012.

» Social Security accounted for the largest source of income for all beneficiaries in 2012. Among beneficiaries
in the middle of the income distribution, Social Security accounted for a larger share of income among black
(80%) and Hispanic (76%) beneficiaries than among white beneficiaries (57%). Conversely, investment income
(interest, dividends, rental income, and IRA withdrawals) accounted for a larger share of income among white
middle income beneficiaries (16%) than among black (4%) or Hispanic (4%) middle income beneficiaries, and
defined benefit pensions accounted for twice the share of income among white (14%) than among black (7%) or
Hispanic (7%) middle income beneficiaries.

» Median income increased with years of education, but racial/ethnic differences in median income persisted at
all education levels. Among college graduates, the median income of white beneficiaries was $41,400 - nearly
$7,000 higher than the median income of Hispanic beneficiaries ($34,800), and more than $12,000 higher than
the median income of black beneficiaries ($29,200) in 2012.

» Racial/ethnic disparities in income were evident in all age groups, and were most pronounced among
beneficiaries between the ages of 65 and 74. Among beneficiaries between the ages of 65 and 74, median income
among white beneficiaries ($31,100) was about twice as high as median incomes among black or Hispanic
beneficiaries ($17,550 and $14,900, respectively) in 2012. Income differences by race/ethnicity were smaller for
beneficiaries under the age of 65 and beneficiaries ages 85 and older.

» Median per capita income was higher among married beneficiaries ($26,500) than divorced, widowed, or single
beneficiaries ($19,950, $19,200, and $13,850, respectively), with racial/ethnic differences in median income
across all marital groups. Among married beneficiaries, per capita median income for white beneficiaries
($28,550) was about $10,000 higher than per capita median incomes for black and Hispanic beneficiaries
($18,550 and $15,950, respectively) in 2012.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 1.4 In 2012, half of all Medicare beneficiaries had annual incomes at or below $22,500. This includes
income from all major sources, including Social Security income, pension income, earnings, Supplemental Security
Income (SSIJ), and investment income. Median per capita income was lower for black and Hispanic beneficiaries
($15,250 and $13,800, respectively) than for white beneficiaries ($24,800) in 2012.

 

 

    
 

 

 

 

Median Per Capita Income of the Medicare Population,
Overall, and by Race/Ethnicity, 2012
1 $24,800
$22,500
I
; $15,250
* $13,800
I
I
I
I
I
I
Overall White Black Hispanic
poumber of 50.4 million = 40.0 million 4.7 million 3.6 million
Share of beneficiaries 100% I 79% 9% 7%
NOTE: Beneficiaries identified as "other" races not shown separately. Numbers do not sum, because 2.1 million are identified as "Other" races.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 1.2 The distribution of income for the Medicare population differed by race/ethnicity. While the top 10
percent of black and Hispanic beneficiaries had incomes above $43,900 and $44,550, respectively, the top 10 percent
of white beneficiaries had incomes above $70,000 in 2012. Similarly, while the top 1 percent of black and Hispanic
beneficiaries had more than $99,900 and $101,100 in income, respectively, the top 1 percent of white beneficiaries
had more than $161,900 in income (not shown).

 

 

 

 
 
  
   
  
 
 
 

 

 

 

 

 

  

 

 

Distribution of Per Capita Income of the Medicare Population,
By Race/Ethnicity, 2012
Share of Medicare beneficiaries (50" pereen a
- Median Mean Top 10%
50% + income (@) income percentile (x)
40% 4 White $24,800 $35,050 $70,000
Black $15,250 $21,900 $43,900
30% 4 Hispanic $13,800 $20,100 $44,550
20% + 1"
percentile
10% +
White
Hispanic ack
0% T T T T T P T T 1
$o $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Per Capita Income
NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 1.3 Social Security accounted for the largest source of income for all beneficiaries in 2012. Among
beneficiaries in the middle of the income distribution, Social Security accounted for a larger share of income among
black (80%) and Hispanic (76%) beneficiaries than among white beneficiaries (57%). Conversely, investment
income (interest, dividends, rental income, and IRA withdrawals) accounted for a larger share of income among
white middle income beneficiaries (16%) than among black (4%) or Hispanic (4%) middle income beneficiaries,
and defined benefit pensions accounted for twice the share of income among white (14%) than among black (7%) or
Hispanic (7%) middle income beneficiaries.

 

Sources of Income among Medicare Beneficiaries in the
Middle of the Income Distribution, by Race/Ethnicity, 2012

 

White Black Hispanic
Other Income Other Income
Other Income (e.g., Investments, {e.g., Investments,

    

    

{e.g., Investments, IRA distributions) IRA distributions}
IRA distributions) Pension

Income

      

Earnings

13%
Social Security
income Social Security Social Security
. 57% Income Titeey ity
Pay 3 80% may;
ney (J (
Median income: $24,800 Median income: $15,250 Median income: $13,800

Mean income: $25,100 Mean income: $15,150 Mean income: $13,700

NOTE: "Middle of the Income Distribution" refers to beneficiaries in the middle 20% of the per capita income distribution, by race/ethnicity. Investment income includes
interest, dividend, rental income, and IRA withdrawals. Numbers may not sum to 100 percent due to rounding. Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 1.4 Median income among people on Medicare increased with years of education, but racial/ethnic
differences in median income persisted at all education levels. Among college graduates, the median income of white
beneficiaries was $41,400 - nearly $7,000 higher than the median income of Hispanic beneficiaries ($34,800), and
more than $12,000 higher than the median income of black beneficiaries ($29,200) in 2012.

 

Median Per Capita Income of the Medicare Population,
by Education Level and Race/Ethnicity, 2012

Median per capita income

 

{in 2012 dollars) @ $41,400
White

° Black @ $34,800

@ Hispanic @ 528,600 @ 328,200

 

 

 

@ 521,850 8 $22,050

$18,450
@ ss SEs

@ £19293

 

Less than High School Some College
High School Graduate College Graduate
Median income
among all $13,700 $20,650 $26,700 $40,000

beneficiaries:

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 1.5 Racial/ethnic disparities in income were evident in all age groups, and were most pronounced
among beneficiaries between the ages of 65 and 74. Among beneficiaries between the ages of 65 and 74, median
income among white beneficiaries ($31,100) was about twice as high as median incomes among black or Hispanic
beneficiaries ($17,550 and $14,900, respectively) in 2012. Income differences by race/ethnicity were smaller for

beneficiaries under the age of 65 and beneficiaries ages 85 and older.

 

Median Per Capita Income of the Medicare Population,
by Age and Race/Ethnicity, 2012

Median per capita income

 

 

 

 

 

in 2012 doll
(in lollars) @ §81,100
Q White
@ Black @ 324,550
@ Hispanic
@ 17,650 8 $17,550 Q 18,250
O $13,000 $14,300 @ 343-528 $13,550
12,350 $11,300
Under Age 65 Ages 65-74 Age 75 -- 84 Ages 85 and Older
Median income
among all $16,200 $28,100 $22,700 $17,400

beneficiaries:

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 1.6 Median per capita income was higher among married beneficiaries ($26,500) than divorced, widowed,
or single beneficiaries ($19,950, $19,200, and $13,850, respectively), with racial/ethnic differences in median income
across all marital groups. Among married beneficiaries, per capita median income for white beneficiaries ($28,550)
was about $10,000 higher than per capita median incomes for black and Hispanic beneficiaries ($18,550 and $15,950,

respectively) in 2012.

 

Median Per Capita Income of the Medicare Population, by
Marital Status and Race/Ethnicity, 2012

Median per capita income
(in 2012 dollars)

aa @ suse
@ Black
@ Hispanic @ 521,200 @ s21.650

$18,550
$15,950 @ $16,250 @ tees
iv
12,550
@ $12,600 @ $12-358 @ $11,308

 

 

 

 

 

Married Divorced Widowed Single
Median income

seteres, 926,500 $19,950 $19,200 $13,850

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
SECTION 2: FINANCIAL ASSETS AND SAVINGS

This section describes the total savings of the Medicare population across race/ethnicity in 2012. Total savings
include retirement account holdings (such as IRAs or 401Ks) and other financial assets, including savings accounts,

bonds and stocks. Savings are presented on a per person basis; for married people, savings are divided equally

between spouses to calculate per capita savings.

KEY FINDINGS:

»

»

»

»

»

»

»

»

Nearly all (92%) Medicare beneficiaries had some savings, but rates were higher among white beneficiaries
(95%) than among black and Hispanic beneficiaries (80% and 81%, respectively). Similarly, one in 20 white
beneficiaries did not have savings or were in debt compared to nearly one in five black beneficiaries and
Hispanic beneficiaries.

Half of all Medicare beneficiaries had less than $63,100 in savings in 2012. Median savings for white
beneficiaries ($85,950) were more than seven times the median savings for black beneficiaries ($11,650) and
Hispanic beneficiaries ($12,050).

Among beneficiaries with savings, half had less than $77,500 in savings in 2012; median savings for white
beneficiaries ($95,900) were nearly five times the median savings for black beneficiaries ($19,700) and nearly
four times the median savings for Hispanic beneficiaries ($25,150) in 2012.

While the top 10 percent of all black and Hispanic beneficiaries had savings above $137,200 and $215,550,
respectively, the top 10 percent of white beneficiaries had savings above $723,200 in 2012.

The share of beneficiaries with any savings and the median savings among beneficiaries increased with income,
with large racial/ethnic differences in savings across all income levels. Among beneficiaries who had incomes
over 400 percent of the federal poverty level, median savings for white beneficiaries ($239,050) was nearly five
times the median savings for black beneficiaries ($48,550) and more than three times the median savings for
Hispanic beneficiaries ($71,400).

Median savings were higher among beneficiaries with more years of education, but differences in savings by
race/ethnicity were evident across all education groups with the greatest disparities among beneficiaries with
the most years of education. Among college-educated beneficiaries, median savings for white beneficiaries
($253,550) was nearly five times the median savings for black beneficiaries ($52,250) and more than four times
the median savings for Hispanic beneficiaries ($57,000) in 2012.

Median savings were lowest among those age 85 and older ($40,900) and those under age 65 ($27,050), but
median savings differed across race/ethnicity for all age groups. Among beneficiaries between the ages of 65
and 74, median savings among white beneficiaries ($118,400) was about six times the median savings among
black and Hispanic beneficiaries $19,700 and $17,500, respectively) in 2012.

Median per capita savings were higher among married beneficiaries ($84,550) than among divorced,
widowed, or single beneficiaries ($53,750, $41,450, and $19,300, respectively), with racial/ethnic differences
in median savings across all marital groups. Among married beneficiaries, median per capita savings among
white beneficiaries was $107,350, between five and six times the median savings among black and Hispanic
beneficiaries ($18,800 and $19,650, respectively) in 2012.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 2.1 Nearly all (92%) Medicare beneficiaries had some savings, but rates were higher among white
beneficiaries (95%) than among black and Hispanic beneficiaries (80% and 81%, respectively). Similarly, one in
20 white beneficiaries did not have savings or were in debt, compared to nearly one in five black and Hispanic
beneficiaries.

 

Share of Medicare Beneficiaries with Savings,
by Race/Ethnicity, 2012

White Black Hispanic

 

No savings

|

 
      

     

No savings

19%

No savings

20%

RETR TL)
Ty

95%

 

Total beneficiaries: Total beneficiaries: Total beneficiaries:
40.0 million 4.7 million 3.6 million

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 2.2 Half of all Medicare beneficiaries had less than $63,100 in savings in 2012. Median savings for white
beneficiaries ($85,950) were more than seven times the median savings for black beneficiaries ($11,650) and Hispanic
beneficiaries ($12,050) in 2012.

 

Median Per Capita Savings of the Medicare Population,
Total and by Race/Ethnicity, 2012

Median per capita savings, among
all beneficiaries (In 2012 dollars)

$85,950

 

      
 

 

 

 

I
I
I
I
$63,100 |
I
I
I
I
I
I
I $11,650 $12,050
I
I
Total White Black Hispanic
beanie --50.4million 4 40.0 million 4.7 million 3.6 million

NOTE: Beneficiaries identified as "other" races not shown separately. Numbers de nat sum, because 2.1 million are identified as "Other" races.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 2.3 Among beneficiaries with savings, half had less than $77,500 in savings in 2012; median savings for
white beneficiaries ($95,900) were nearly five times the median savings for black beneficiaries ($19,700) and nearly
four times the median savings for Hispanic beneficiaries ($25,150) in 2012.

 

Median Per Capita Savings of the Medicare Population,
Total and by Race/Ethnicity, 2012

Median per capita savings, among
those with savings (in 2012 dollars)

$95,900

 

      
 

 

 

 

I
I
I
$77,500 I
I
I
I
I
I
I $19,700 $25,150
I
I
Total White Black Hispanic
Number of ane I ense ne sn
beneficiaries with 46.6 million 38.1 million 3.7 million 2.9 million
savings I
Share of Oh eaves 92% l 95% 80% 81%

NOTE: Beneficiaries identified as "other" races not shown separately. Numbers do not sum, because 1.8 million are identified as "Other" races.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 2.4 The top 1o percent of black and Hispanic beneficiaries had savings above $137,200 and $215,550,
respectively, while the top 10 percent of white beneficiaries had savings above $723,200 in 2012. Similarly, while the
top 1 percent of black and Hispanic beneficiaries had more than $699,450 and $1,082,750 in savings, respectively, the
top 1 percent of white beneficiaries had more than $3,934,650 in savings in 2012 (not shown).

 

Distribution of Per Capita Savings of the Medicare Population,
By Race/Ethnicity, 2012

Share of Medicare beneficiaries

 

 
  
   
    
 
 
 
  

 

 

 

 

 

Median Mean Top 10%
50% savings (@) savings percentile (x)
Median White $85,950 $319,950 $723,200
40% (50** percentile) ' , ,
Black $11,650 $57,550 $137,200
30% Hispanic $12,050 $94,350 $215,550
10%
20% percentile

10%

CODD y White

o% -» Black > Hispanic
$0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000
Per Capita Savings

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 2.5 The share of beneficiaries with any savings and the median savings among beneficiaries increased
with income, with large racial/ethnic differences in savings across all income levels. Among beneficiaries who had
incomes over 400 percent of the federal poverty level, median savings for white beneficiaries ($239,050) was nearly
five times the median savings for black beneficiaries ($48,550) and more than three times the median savings for
Hispanic beneficiaries ($71,400) in 2012.

 

 

 

 

 

 

Median Per Capita Savings of the Medicare Population,
by Federal Poverty Level and Race/Ethnicity, 2012
Median per capita savings,
among all beneficiaries (in 2012 dollars) @ $239,050
@ white
@ Black
@ Hispanic
@ $75,600 $71,400
$48,550
$17,950 Os
$2,100 $2,100
Federal Poverty Less than 200% FPL 200% - 400% FPL More than 400% FPL
Medi
all henefiviarice $11,800 $61,100 $210,400
Share with savings 83% 96% 98%
NOTE: 200% of FPL = $22,340 per year for individuals in 2012; 400% of FPL = $44,680 per year for individuals in 2012. Beneficiaries identified as
"other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 2.6 Median savings were higher among beneficiaries with more years of education, but differences in
savings by race/ethnicity were evident across all education groups with the greatest disparities among beneficiaries
with the most years of education. Among college-educated beneficiaries, median savings for white beneficiaries
($253,550) was nearly five times the median savings for black beneficiaries ($52,250) and more than four times the
median savings for Hispanic beneficiaries ($57,000) in 2012.

 

Median Per Capita Savings of the Medicare Population,
by Education Level and Race/Ethnicity, 2012

Median per capita savings,
among all beneficiaries (in 2012 dollars)

253,550
@ white @ .
@ Black

O Hispanic

 

 

 

 

@ $106,350
© se+700 @ sas

$34,200
18,200 19,000 23,500
Ss $03 6 312/300 928,

 

Less than High School Some College
Education Level High School Graduate College Graduate
Wega among $10,600 $52,500 $87,650 $223,650
Share with savings 83% 93% 95% 97%

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

11
EXHIBIT 2.7 Median savings were lowest among those age 85 and older ($40,900) and those under age 65 ($27,050),
but median savings differed across race/ethnicity for all age groups. Among beneficiaries between the ages of 65 and
74, median savings among white beneficiaries ($118,400) was about six times the median savings among black and
Hispanic beneficiaries $19,700 and $17,500, respectively) in 2012.

 

Median Per Capita Savings of the Medicare Population,
by Age and Race/Ethnicity, 2012

Median per capita savings,
among all beneficiaries (in 2012 dollars)

© wie @ 118,400
@ Black @ 397,700

@ Hispanic

 

 

 

 

@ $52,250
@ $24,350

 

$17-298
0 17,500
$8460 $8,700
$3,950 @ $1,700 $1,700
Age Under Age 65 Ages 65-74 Age 75 - 84 Ages 85 and Older
Median among $27,050 $91,750 $73,400 $40,900
Share with savings 89% 94% 92% 92%

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 2.8 Median per capita savings were higher among married beneficiaries ($84,550) than among divorced,
widowed, or single beneficiaries ($53,750, $41,450, and $19,300, respectively), with racial/ethnic differences in
median savings across all marital groups. Among married beneficiaries, median per capita savings among white
beneficiaries was $107,350, between five and six times the median savings among black and Hispanic beneficiaries
($18,800 and $19,650, respectively) in 2012.

 

Median Per Capita Savings of the Medicare Population,
by Marital Status and Race/Ethnicity, 2012

Median per capita savings,
among all beneficiaries (in 2012 dollars)

@ white @ s107,350

 

 

 

 

 

@ Black
O Hispanic

@ $70,250

@s:58,600
@ 335,200
O 312-650
18,800 5,000
Osx @s88 @ £88
Marital Status Married Divorced Widowed Single
Median among $84,550 $53,750 $41,450 $19,300
Share with savings 96% 82% 87% 80%

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
SECTION 3: HOME EQUITY

This section describes the home equity of the Medicare population across race/ethnicity in 2012, including the share of

beneficiaries with home equity, and the home equity values among beneficiaries who have any home equity. As with

income and savings, home equity values are divided equally between spouses to calculate per capita home equity. The

home equity values shown account for any decrease in home equity values that occurred as a result of the mortgage

crisis; it has been estimated that more than 1.5 million Americans over age 50 lost their homes between 2007 and 2011.°

KEY FINDINGS:

»

»

»

»

»

»

»

In 2012, most Medicare beneficiaries (78%) had some home equity, with higher rates among white beneficiaries
(83%) than among black or Hispanic beneficiaries (61% and 60%, respectively).

Among beneficiaries who had home equity, half of all beneficiaries had less than $93,850 in home equity in
2012; median home equity values were significantly higher among white beneficiaries ($100,200) than black or
Hispanic beneficiaries ($53,650 and $67,700, respectively) in 2012.

Among homeowners, the distribution of home equity values differed by race/ethnicity; while the top 10 percent
of black beneficiaries had home equity exceeding $181,750, this was more than $100,000 less than the home
equity of the top 10 percent of Hispanic beneficiaries ($285,400) and the top 10 percent of white beneficiaries
($325,200) in 2012.

The share of beneficiaries with home equity and the median amount of home equity increased with income,
with racial/ethnic differences in home equity across all income levels. Among beneficiaries with home equity
who had incomes over 400 percent of the federal poverty level, median home equity for black beneficiaries
($65,150) was almost $40,000 less than the median home equity among Hispanic beneficiaries ($103,850) and
more than $50,000 less than the median home equity among white beneficiaries ($119,750) in 2012.

Median home equity was higher among beneficiaries with more years of education, but median home equity
differed across race/ethnicity for all education groups. Among beneficiaries with college degrees who had home
equity, median home equity among white beneficiaries ($146,550) was almost $60,000 higher than the median
home equity among black beneficiaries ($86,950) and more than $30,000 higher than the median home equity
among Hispanic beneficiaries ($115,250) in 2012.

Median home equity values were lowest among those under the age of 65 ($50,300), but home equity values
differed across race/ethnicity for all age groups. Among beneficiaries between the ages of 65 and 74 who had home
equity, median home equity among white beneficiaries ($109,350) was more than $45,000 higher than the median
home equity among black beneficiaries and Hispanic beneficiaries ($58,700 and $63,950, respectively) in 2012.

Among beneficiaries with home equity, median home equity was highest among married beneficiaries, but on
a per capita basis, median per capita home equity values were higher among divorced beneficiaries ($130,800)
than among married, widowed, or single beneficiaries ($81,400, $94,200, and $92,150, respectively) in 2012;
moreover, more than 40 percent of widowed beneficiaries and more than 60 percent of single beneficiaries had
no home equity, and racial/ethnic differences in home equity values were evident across all marital groups.
Among divorced beneficiaries, median per capita home equity among black beneficiaries ($86,750) was about
$33,000 lower than the median per capita home equity among Hispanic beneficiaries ($120,050) and almost
$50,000 lower than the median per capita home equity of white beneficiaries ($135,700) in 2012.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future 13
EXHIBIT 3.1 In 2012, most Medicare beneficiaries (78%) had some home equity. However, a larger share of white
beneficiaries (83%) had some home equity than black or Hispanic beneficiaries (61% and 60%, respectively).

 

Share of Medicare Beneficiaries with Home Equity,
by Race/Ethnicity, 2012

White Black Hispanic

 

  

No home
equity
17%

 
   
 

No home No home
equity equity
39% 40%

  

Share with

CMe (Lia

83%

 

Total beneficiaries: Total beneficiaries: Total beneficiaries:
40.0 million 4.7 million 3.6 million

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 3.2 Among beneficiaries with home equity, half had home equity values below $93,850, with large
variations in home equity values by race/ethnicity in 2012. Among those with home equity, median home equity
value among white beneficiaries was $100,200 in 2012, compared to $53,650 and $67,700 among black and Hispanic
beneficiaries, respectively in 2012.

 

Median Per Capita Home Equity of Medicare Homeowners,
Overall and by Race/Ethnicity, 2012

Median per capita home equity,
among those with home equity

 

   
   

  

 

 

 

I
I
{in 2012 dollars) 100,200
$93,850 $100,
I
I $67,700
I $53,650
I
I
I
I
I
Total White Black Hispanic
Number of I
beneficiaries with 39.5 million 33.2 million 2.8 million 2.2 million
home equity I
h hh
Snare aly 78% I 83% 61% 60%

NOTE: Beneficiaries identified as "other" races not shown separately. Numbers do not sum, because 1.3 million are identified as "Other" races.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
EXHIBIT 3.3 Among beneficiaries with home equity, the distribution of home equity values differed by race/
ethnicity; while the top 10 percent of black beneficiaries had home equity exceeding $181,750, this was more than
$100,000 less than the home equity of the top 10 percent of Hispanic beneficiaries ($285,400) and the top 10 percent
of white beneficiaries ($325,200) in 2012.

 

Distribution of Per Capita Home Equity of Medicare
Homeowners, By Race/Ethnicity, 2012

Share of Medicare homeowners

 

 
    
  
   
 
 
 
 
 

 

 

 

 

 

 

 

Median
(50** percentile}
Median Mean Top 10th
50% { home equity home equity percentile
40% 4 White $100,200 $150,900 $325,200
Black $53,650 $85,750 $181,750
30% Hispanic $67,700 $115,800 $285,400
lot
20% 4 percentile
10% + St Whit
ite
Black _? *
Hispanic
0% T T T T T T T 1
$o $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000

Per Capita Home Equity

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 3.4 The share of beneficiaries with home equity and the median amount of home equity increased with
income, with racial/ethnic differences in home equity across all income levels. Among beneficiaries with home
equity who had incomes over 400 percent of the federal poverty level, median home equity for black beneficiaries
($65,150) was almost $40,000 less than the median home equity among Hispanic beneficiaries ($103,850) and more
than $50,000 less than the median home equity among white beneficiaries ($119,750) in 2012.

 

Median Per Capita Home Equity of Medicare Homeowners,
by Federal Poverty Level and Race/Ethnicity, 2012

Median per capita home equity,

 

 

 

 

 

among beneficiaries with home equity (in 2012 dollars)
@ $119,750
@ White Qs103,850
Black
Ok @s27650
O Hispanic @ $79,800
$60,850 Qs65,150
$54,750 $52,750
$46,250
Federal Poverty Less than 200% FPL 200% - 400% FPL More than 400% FPL
an eaian among $72,050 $83,250 $117,600
Share with
honey 60% 82% 91%

NOTE: 200% of FPL = $22,340 per year for individuals in 2012; 400% of FPL = $44,680 per year for individuals in 2012. Beneficiaries identified as
"other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

45
EXHIBIT 3.5 Median home equity was higher among beneficiaries with more years of education, but median home
equity differed across race/ethnicity for all education groups. Among beneficiaries with college degrees who had
home equity, median home equity among white beneficiaries ($146,550) was almost $60,000 higher than the median
home equity among black beneficiaries ($86,950) and more than $30,000 higher than the median home equity
among Hispanic beneficiaries ($115,250) in 2012.

 

Median Per Capita Home Equity of Medicare Homeowners,
by Education Level and Race/Ethnicity, 2012

Median per capita home equity,

 

 

 

 

among beneficiaries with home equity {in 2012 dollars) @ $146,550

@ White

evn @ 115,250

@ Hispanic @ $90,150 9 Se ubo" @ $86,950
@ 566,800 °73,300 @ 568,200

@ $49, 300 @ $53,500

41,600

 

. Less than High School Some College
Education Level High School Graduate College Graduate
aedlan among $61,000 $86,350 $100,000 $143,050

Share with
home eculty 67% 78% 81% 86%

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 3.6 Median home equity values were lowest among those under the age of 65 ($50,300), but home equity
values differed across race/ethnicity for all age groups. Among beneficiaries between the ages of 65 and 74 who had
home equity, median home equity among white beneficiaries ($109,350) was more than $45,000 higher than the
median home equity among black beneficiaries and Hispanic beneficiaries ($58,700 and $63,950, respectively) in 2012.

 

 

 

 

 

 

Median Per Capita Home Equity of Medicare Homeowners,
by Age and Race/Ethnicity, 2012
Median per capita home equity,
among beneficiaries with home equity (in 2012 dollars)
@ wnite Os100,350 @ s102,850 $101,500
@ Black 95,600
Q@ Hispanic @ $84,900
$65,850 $68,200
Que Saw © ©
50,300
@ 322,300
Age Under Age 65 Ages 65-74 Age 75-84 Ages 85 and Older
Median among $50,300 $102,500 $100,950 $99,000
hone wey 62% 83% 81% 78%
NOTE: Beneficiaries identified as "other" races not shown separately,
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

16
EXHIBIT 3.7 Among beneficiaries with home equity, median home equity was highest among married beneficiaries,
but on a per capita basis, median per capita home equity values were higher among divorced beneficiaries
($130,800) than among married, widowed, or single beneficiaries ($81,400, $94,200, and $92,150, respectively) in
2012; moreover, more than 40 percent of widowed beneficiaries and more than 60 percent of single beneficiaries had
no home equity, and racial/ethnic differences in home equity values were evident across all marital groups. Among
divorced beneficiaries, median per capita home equity among black beneficiaries ($86,750) was more than $33,000
lower than the median per capita home equity among Hispanic beneficiaries ($120,050) and almost $50,000 lower
than the median per capita home equity of white beneficiaries ($135,700) in 2012.

 

Median Per Capita Home Equity of Medicare Homeowners,
by Marital Status and Race/Ethnicity, 2012

Median per capita home equity,
among beneficiaries with home equity (in 2012 dollars)

 

 

 

 

 

QO white
Q Black g $135,700
oo 120,050
@ Hispanic '
@ 310,400 Q@s105,s00
@ 27,050 @ $326,750
322-989
15
$57,000 0 8 $62,050
$39,650 $44,350
Marital Status Married Divorced Widowed Single
Medi
all homeowners $81,400 $130,800 $94,200 $92,150
Sh ith
home equity 89% 82% 59% 36%

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future
SECTION 4: PROJECTED GROWTH IN INCOME, ASSETS,
AND HOME EQUITY

This section presents projections of income, assets, and home equity for the Medicare population in 2030, and
examines changes during the period between 2012 and 2030, to explore the extent to which future generations
of Medicare beneficiaries will be more economically secure than the current generation. Data in this section are
adjusted for inflation; all dollar amounts are in 2012 per capita dollars.

KEY FINDINGS

» In 2030, the Medicare population is projected to have somewhat higher incomes than current beneficiaries;
median per capita income is projected to rise from $22,500 in 2012 to $28,600 in 2030, with income increasing
unevenly across race/ethnicity. In 2030, median income is projected to be substantially higher for white
beneficiaries ($32,800) than for black and Hispanic beneficiaries ($19,000 and $18,100, respectively).

» By 2030, the racial/ethnic differences in shares of beneficiaries with savings are projected to narrow, with
the share of black and Hispanic beneficiaries with savings projected to grow to 89 percent and 88 percent,
respectively, but remaining slightly lower than the rate among white beneficiaries (97%).

» The gap in savings across race/ethnicity is projected to widen by 2030; while median savings for white
beneficiaries is projected to increase by about $61,100, this is more than double the absolute dollar increase
in median savings for black and Hispanic beneficiaries ($22,600 and $23,650, respectively) between 2012 and
2030. The increase in savings for future generations largely reflects the higher prevalence of retirement account
pensions among these beneficiaries during their working years compared to current beneficiaries. These higher
savings amounts (that result in higher IRA withdrawals) are largely offset by lower pension incomes compared
to current beneficiaries.

» The share of Medicare beneficiaries with home equity and the median home equity value among those with
home equity is expected to increase between 2012 and 2030. However, among beneficiaries with home equity,
the growth in median home equity is projected to be higher for white beneficiaries ($18,850) than black and
Hispanic beneficiaries ($5,200 and $5,950, respectively) between 2012 and 2030, leading to widening racial/
ethnic disparities in home equity values among the next generation of Medicare beneficiaries.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

18
EXHIBIT 4.1 In 2030, the Medicare population is projected to have somewhat higher incomes than current
beneficiaries; median per capita income is projected to rise from $22,500 in 2012 to $28,600 in 2030, with income
increasing unevenly across race/ethnicity. In 2030, median income is projected to be substantially higher for white
beneficiaries ($32,800) than for black and Hispanic beneficiaries ($19,000 and $18,100, respectively).

 

Projected Growth in Median Per Capita Income Among
Medicare Beneficiaries, by Race/Ethnicity, 2012 and 2030

Median per capita income 2012 @ 2030
(in 2012 dollars)

$32,800

 
 

$28,600

 
 
 

$18,100

  

Overall White Black Hispanic

snr 2000 + $6,100 + $8,000 * $3,750 "400

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

EXHIBIT 4.2 By 2030, the racial/ethnic differences in shares of beneficiaries with savings are projected to narrow,
with the share of black and Hispanic beneficiaries with savings projected to grow to 89 percent and 88 percent,
respectively, but remaining slightly lower than the rate among white beneficiaries (97%). The differences in the
amount of savings across race/ethnicity is projected to widen by 2030; median savings for white beneficiaries is
projected to increase by about $61,100 - more than double the absolute dollar increase in median savings for black
beneficiaries and Hispanic beneficiaries ($22,600 and $23,650, respectively) between 2012 and 2030.

 

Projected Growth in Median Per Capita Savings Among
Medicare Beneficiaries, by Race/Ethnicity, 2012 and 2030

Median per capita savings, 2012 02030
among all beneficiaries (in 2012 dollars)

$147,050

   

$108,350

 
  
 

$35,700

   

$34,250

 

Overall White Black Hispanic
$ increase, 2012-2030 + $45,250 + $61,100 + $22,600 + $23,650
Share of beneficiaries G79, 94% 95% 97% 80% 89% 81% 88%

with any savings

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

19
EXHIBIT 4.3

Overall, the share of Medicare beneficiaries who have any home equity is projected to increase slightly from 78
percent in 2012 to 80 percent in 2030, with higher rates among whites (85%) than among black (67%) or Hispanic
(65%) beneficiaries that year. Among beneficiaries with home equity, the growth in median home equity values is
projected to be more than three times higher for white beneficiaries ($18,850) than black and Hispanic beneficiaries
($5,200 and $5,950, respectively) between 2012 and 2030, leading to widening racial/ethnic disparities in home equity
values among the next generation of Medicare beneficiaries.

 

Projected Growth in Median Per Capita Home Equity Among
Medicare Homeowners, by Race/Ethnicity, 2012 and 2030

Median per capita home equity,
among beneficiaries with home equity
(in 2012 dollars)

2012 © 2030

    
  
   

$119,050

107,100
$ $100,2

$73,650

  

$53,650 $58,850

 

Overall White Black Hispanic
$ increase, 2012-2030 +$13,250 + 518,850 + $5,200 + $5,950
Share of beneficiaries 7 a9 80% 83% 85% 61% 67% 60% 65%
with any home equity

NOTE: Beneficiaries identified as "other" races not shown separately.
SOURCE: Urban Institute / Kaiser Family Foundation analysis, 2012.

 

 

 

 

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

20
APPENDIX

Asset and income projections are based on the Urban Institute's Dynamic Simulation of Income Model (DYNASIM3).
DYNASIM3 is a dynamic microsimulation model that projects the population and analyzes the long-run distributional
consequences of retirement and aging issues. The model starts with a representative sample of individuals and
families and ages the data year by year, simulating demographic and economic events including all key components
of retirement income. The model integrates many important trends and differences among groups in life course
processes, including birth, death, schooling, leaving home, first marriage, remarriage, divorce, disability, work,
retirement, and earnings. Projections of fertility, disability, mortality, net immigration, employment, average
earnings, and price changes are aligned to be consistent with 2011 OASDI Trustees projections. Projections of assets
are aligned to the Survey of Consumer Finance (SCF). For a fuller description of DYNASIM3, see Karen E. Smith.
February 2012. "Projection Methods Used in the Dynamic Simulation of Income Model (DYNASIM3)," Program on
Retirement Policy, The Urban Institute.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future

21
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22

the Future

In

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Icl

in the Income and Assets of People on Medicare by Race and Ethn

isparities

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24

the Future

In

ity: Now andi

Icl

in the Income and Assets of People on Medicare by Race and Ethn

isparities

Wide D
 

 

Meschede, Tatjana, Thomas M. Shapiro, and Jennifer Wheary. Living Longer on Less: The New Economic (In)Security of Seniors. Institute on
Assets and Social Policy and Démos, by a Thread Report no. 4. May 2009.

Kaiser Family Foundation, "Key Issues in Understanding the Economic and Health Security of Current and Future Generations of Seniors," March 2012.

Shapiro, Thomas, Tatjana Meschede, and Sam Osoro. The Roots of the Widening Racial Wealth Gap: Explaining the Black-White Economic
Divide. Brandeis University Institute on Assets and Social Policy, Research and Policy Brief. February 2013.

McKernan, Signe-Mary, Caroline Ratcliffe, Eugene Steuerle, and Sis Zhang, "Less Than Equal: Racial Disparities in Wealth Accumulation," April 2013.
Kaiser Family Foundation, "Projecting Income and Assets: What Might the Future Hold for the Next Generation of Medicare Beneficiaries?" June 2011.
Kaiser Family Foundation, "Medicare at a Glance: Fact Sheet," November 2012.

Butrica, Barbara, Howard lams, Karen E. Smith, and Eric Toder. The Disappearing Defined Benefit Pension and Its Potential Impact on the
Retirement Incomes of Boomers. Social Security Bulletin, 69(3): 1-27. January 2009.

Kaiser Family Foundation, "2012 Employer Health Benefits Survey," September 2012.

Trawinski, Lori, "Nightmare on Main Street: Older Americans and the Mortgage Market Crisis," AARP Public Policy Institute, July 2012.

Wide Disparities in the Income and Assets of People on Medicare by Race and Ethnicity: Now and in the Future 25
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