Gerontology Chapter 5 – Flashcards
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Social Security benefit levels are based on
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earnings during years of work
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What is the distinguishing feature of social assistance programs?
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Means testing
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What is the distinguishing feature of social insurance programs?
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The notion that people contribute to a common pool. The view that people share common risk such as unemployment, disability, loss of wages
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What is the distinguishing feature of fiscal welfare programs?
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Tax Breaks
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Which type of tax finances the majority of federal social assistance programs?
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Income taxes
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Which type of tax finances the majority of social insurance programs?
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Payroll Taxes
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Define Fiscal Welfare
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Indirect payment to individuals through the tax system
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What type of program is Fiscal Welfare more commonly known as?
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Tax Breaks (Tax Expenditures)
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Define the "replacement rate"
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The amount of preretirement pay that is replaced by Social Security retirement benefit
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Do low income or high income workers have a higher Social Security Replacement rate?
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Low Income
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In what year was legislation passed establishing Social Security?
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1935
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In what year was legislation passed establishing Medicare and Medicaid?
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1965
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What is the source of the largest share of older people's income?
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Social Security
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What is Supplemental Security Income?
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A federal means tested, social assistance program for the aged, blind, and disabled poor
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How is the Social Security benefit affected by retiring at 62 rather than 65 years of age?
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current workers who retire at age 62 receive benefits that are reduced by 25 percent of what they would have received at 65.
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Progressive Tax
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The higher one's income the higher the tax rate
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Regressive Tax
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A tax that takes a larger percentage from low income people than from high income people
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Which federal tax is considered progressive?
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Income Taxes
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Which federal tax is considered regressive?
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Payroll taxes
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Horizontal Equity
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everyone with same income level pays the same rate of taxes
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Vertical Equity
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people who make more money have higher capacity to pay higher taxes (most people do not agree with this equity)
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Flat Tax
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same percent tax regardless of income
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Social Security is what type of tax?
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Regressive Tax
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Medicare is what type of tax?
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Flat Tax
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Entitlement Program
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based on categorical eligibility
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Two types of Social Insurance Programs?
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Social Security and Medicare
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Social insurance programs are considered
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"earned" because you are paying in
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Medicare Part A covers
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Hospital care. Some home heath care and nursing home care
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Medicare Part B covers
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Physician office visits, outpatients services
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Medicare Part C is considered
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managed care
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Medicare Part D covers
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prescription drug coverage
