KY Policy Blog

Social Security Disability Insurance Works for Vulnerable Kentuckians

By Dustin Pugel
October 13, 2017

There are many misconceptions about Social Security Disability Insurance (DI). Despite recent arguments that DI is a hindrance to people’s wellbeing and the commonwealth’s economy, it is instead a vital lifeline for Kentuckians who, after working most of their lives, have their careers cut short due to a severe disability.

Natural population changes, not “culture,” caused rise in Disability Insurance

While some argue the considerable increase in DI beneficiaries in Kentucky is the result of a deficient culture that doesn’t value work, the data does not support this.  The rise read more

Pension Legislation Should Solve Real Problems and Avoid Harmful Consequences

By Jason Bailey
October 6, 2017

Legislative leaders say they will soon share a framework for potential pension legislation the General Assembly will consider in a special session this fall. Big questions loom over the legislation, including the following:

Will it actually reduce the existing unfunded liability Kentucky must pay down over time —the main pension challenge the state faces? While legislators now say they will protect past cost of living adjustments for those already retired, will the bill also avoid breaking promises to current employees? Will it raise costs in the near term through dramatic read more

Level Dollar Approach Shifts Enormous Burden to Upcoming Budget

By Jason Bailey
October 5, 2017

The proposed level dollar approach to funding Kentucky’s pension liabilities would shift a large burden to our upcoming state budget and ask comparatively little from budgets a couple of decades from now. Especially without any new revenue, the method creates pressure for harsh and unacceptable benefit cuts to retirees and workers along with unnecessarily damaging budget cuts that will further undermine key services.

This proposal to pay down all plans’ liabilities under a level dollar method comes from state consultant PFM. Under the approach, payments would be about the same read more

Federal Tax Cut Framework Is Designed for Millionaires

By Anna Baumann
October 4, 2017

Under the tax framework released last week by the Trump administration and Congressional leaders, the wealthiest 1 percent of Kentuckians would get 49.5 percent of the total tax cut received by people in the state, according to a new report by the Institute on Taxation and Economic Policy (ITEP). Though the proposed framework has been hailed as a tax break for the middle class, the report finds it would redistribute massive amounts of wealth upward, while raising taxes for some and worsening income inequality nationwide.

The plan’s cuts are extremely read more

5 Things Kentuckians Need to Know About Federal Budgets Being Voted on This Week

By Ashley Spalding
October 3, 2017

This week both the U.S. House and Senate are expected to vote on budget proposals that would have a devastating impact on Kentuckians. The full House will be voting on its budget resolution, which passed committee in July. The Senate will be “marking up” its recently released budget as well, a process of considering the plan in committee with the opportunity to make changes before the committee votes. In both budgets, critical investments in our state are at risk — and with Kentucky more heavily reliant on federal spending than read more

Kentucky Will Face Transition Costs If It Switches to 401ks

By Jason Bailey
October 3, 2017

Proponents are claiming Kentucky will face no transition costs from shutting down its defined benefit (DB) pension plans and moving employees into 401k-type defined contribution (DC) plans. That assertion ignores why there are transition costs from closing a plan.

DB plans are pre-funded, as the governor’s staff recently noted in an email to the General Assembly that cited an article from the Reason Foundation. Being pre-funded means DB plans are not designed for new workers to directly pay for the benefits of retired workers. Looking at that fact alone, one read more

Medicaid Works for Kentucky

By Dustin Pugel
October 3, 2017

Medicaid provides health care coverage to over 1.4 million Kentuckians. For over 50 years it has helped pregnant women, children, people with disabilities and seniors and in the past 3 years it has allowed all low-income Kentuckians under 138 percent of poverty to get care when they need it. This critical health program has been at risk in 2017 for severe cuts under healthcare repeal efforts in Congress, and will face continued threats for more cuts through the federal budget process and the changes to Kentucky’s Medicaid program proposed to read more

Kentucky Still Among the Worst for Student Loan Default

By Ashley Spalding
September 28, 2017

Kentucky again ranks among the worst states for rates of student loan default, according to new data released by the U.S. Department of Education. This latest data is yet another indicator Kentucky students have difficulty paying for college — largely due to public disinvestment in higher education that has a particularly damaging impact on low-income students and students of color.

Kentucky’s 3-year student loan default rate is now 14 percent, which is the 9th worst in the nation. Although this is an improvement over last year’s default rate of 15.5 read more

Decline of Private Sector Defined Benefit Plans No Model for Public Plans

By Jason Bailey
September 20, 2017

Calls to end Kentucky’s defined benefit (DB) public pension plans often refer to the move away from DB plans in the private sector and suggest the public sector should follow suit and become more “modern.” But along with the harm to private employees that has accompanied this trend, industry and government are apples and oranges when it comes to pensions. The decline in private sector plans results from increased regulation as well as economic changes and other differences that do not apply to public sector plans.

Decline hasn’t spread to read more

Cassidy-Graham Bill is Latest Attempt to Unravel Kentucky’s Health Care Gains

By Dustin Pugel
September 15, 2017

The latest attempt to repeal the Affordable Care Act (ACA), known as the Cassidy-Graham bill, would cut Kentucky’s funding for low-income health care by $3.1 billion by 2026. That would be the 8th largest cut in the country, even though Kentucky ranks only 26th in the size of its population.

The bill would undermine health care coverage for millions of Americans in three main ways.

A block grant that squeezes funding for 10 years and then runs out

Perhaps the most devastating of the bill’s cuts would result from turning read more