During recent deficit reduction discussions, policymakers have debated whether to increase Medicare beneficiaries’ contributions toward their medical care and reduce the cost of living adjustment to Social Security benefits. Having a clear picture of the extent of poverty among seniors, both nationally and at the state level, is important in the context of these debates. Traditionally, the Census Bureau has estimated poverty rates using the “official” poverty measure, which was created in the early 1960s. Some have expressed concern that the official measure is outdated and does not accurately reflect individuals’ incomes or financial resources.
In response, the Census Bureau released an alternative measure for the first time in 2011, known as the supplemental poverty measure, which defines income and poverty differently than the official measure. The Census Bureau has reported that poverty rates among the elderly (those ages 65 and older) are higher under the supplemental poverty measure (15%) than under the official poverty measure (9%), which is due in large part to the fact that the former deducts health expenses from income.
This analysis looks beyond the national data to examine results by state. The brief describes the two measures of poverty and examines the share of seniors living in poverty and the share of seniors with modest incomes (defined here as below 200 percent of poverty), by state, under both measures, based on pooled data from the 2009 to 2011 Current Population Surveys.