In Iowa, Buttigieg unveils long-term care and a 'public option' 401(k) and Social Security plans

Nick Coltrain | The Des Moines Register

Show Caption Hide Caption In Iowa, Pete Buttigieg discusses his plan for Medicare Pete Buttigieg, Mayor of South Bend, talks about his plan for Medicare while exploring his run for president in February 2019.

RED OAK, Ia. — Democratic presidential candidate Pete Buttigieg launched his first swing in Iowa after a top showing in the Des Moines Register/CNN/Mediacom Iowa Poll by unveiling his plan for long-term care and retirement.

Buttigieg, the mayor of South Bend, Indiana, released the plan shortly before a roundtable with people affected by long-term care. He described his own experience as his father neared the end of his life — Buttigieg and his mother sat down with a social worker, who encouraged them to consider spending all the money they could until his parents qualified for low-income benefits under Medicaid.

“I remember thinking, is that how the greatest county in the world approaches long-term care? Is that the best we can do?” Buttigieg said.

Buttigieg’s plan would establish a $90 per day benefit for long-term care for as long as recipients need it, after an income-related waiting period. It would a be a cash benefit that could be used help pay for assisted-living facilities or home-health aides. He estimated it would cut out-of-pocket care for that type of service by 39% in Iowa.

He would also mandate Medicaid coverage for home- and community-based service provider, with the hope of keeping people who need that care in their communities. It would have requirements to ensure it is being used for long-term care and “isn’t perpetuating or undermining worker standards,” according to the white paper outlining the plan.

Current Medicaid eligibility requires seniors to drain much of their assets to qualify for long-term care coverage.

Buttigieg’s plan aims to keep people who need long-term care in their communities by mandating Medicaid coverage for home- and community-based service providers. He also outlined wanting to boost home health aides through his $15-an-hour minimum wage proposal and federal money for training and ongoing education for those workers. In order to support non-paid caregivers, such as family members, his plan calls for 12 wees of paid family leave per year and giving credit toward social security benefits for years spent as as family caregiver.

The plan also includes reforms to Social Security, including increasing benefits to 125% of the federal poverty limit to people who worked or were a caregiver for 30 years. He proposes paying for it by raising the income cap on the taxes that pay for social security benefits. Currently, social security taxes only apply to income up to $133,000. He would apply social security taxes to individual incomes above $250,000 to maintain the program’s solvency.

He would also establish a “public option” 401(k) program. It would require employers to chip in a 3% match to workers’ accounts after a 1.5% contribution from the worker. It would contain two pre-tax savings accounts: One for retirement specifically and a “Rainy Day Account” that allows some money to be used for any reason and without penalty.

The public option 401(k) would first be available to large corporations and scale down over its life to smaller employers. Employers who offer defined-benefit pensions or retirement benefits similar to the public option 401(k) would be exempt.

Buttigieg’s campaign estimates a “middle-earning American worker” would retire with more than $500,000 in savings.

"This is about our ability to move through life when it doesn't take much to throw you out of the balance that keeps your life working," Buttigieg told the crowd in Red Oak.

The Iowa Poll released Nov. 16 showed Buttigieg with a 9- and 10-percentage-point lead over his next three Democratic rivals, U.S. Sen. Elizabeth Warren, former Vice President Joe Biden and U.S. Sen. Bernie Sanders.

Nick Coltrain is a politics and data reporter for the Register. Reach him at ncoltrain@registermedia.com or at 515-284-8361. Your subscription makes work like this possible. Subscribe today at DesMoinesRegister.com/Deal.