Bush “Medicare Advantage” program nothing more than a handout to the big insurance companies at the expense of the taxpayer and of the long-term care of seniors and disabled Americans who need it most
Washington D.C. – As a major battle looms in Congress over the future of the so-called “Medicare Advantage” program – a program which provides huge subsidies to big private insurance companies that provide Medicare insurance – Americans United for Change was joined by New Hampshire State Representatives Mike Farley, Maureen Nagle, Lily Mesa, and activists Fran Egbers and Barbara Salvatore to call on U.S. Senator John Sununu to take immediate action and stop the privatization of Medicare this afternoon at the William B. Cashin Senior Center in Manchester. Despite its innocuous title, the Bush administration’s “Medicare Advantage” program actually costs the Medicare program and ultimately the taxpayers tens of billions of dollars at the same time it endangers the soundness of the Medicare program that seniors and the disabled depend upon for health care. Like Bush’s plan to privatize Social Security, “Medicare Advantage” is a scheme to privatize Medicare and allow traditional Medicare to whither on the vine. And like its successful campaign in 2005 to defeat the President’s Social Security plan, Americans United for Change is again leading an aggressive national effort in 23 states to apply pressure on Members of Congress to pull the plug on Bush’s under-the-radar plot to dismantle Medicare.
“Just two years after the American people resoundingly rejected the Bush Administration’s misguided scheme to privatize Social Security, President Bush is trying to get away with doing the same to Medicare,” said Mike Brunelle, of Americans United for Change ,the group which was founded in 2005 to defeat President Bush’s proposal to privatize Social Security. “And just like Bush’s Social Security privatization scheme would have irreparably harmed Social Security, Medicare Advantage disadvantages Medicare, disadvantages taxpayers and is undermining one of the most successful government programs in history. Today, we are mounting a campaign to stop the privatization of Medicare –just as we stopped the privatization of Social Security. We call on Senator/Reps. to take meaningful steps to bring an end to a corrupt era of‘corporate welfare’ by eliminating subsidies for“Medicare Advantage” plans before overpayments destroy America’sgreatest health insurance success story.”
“Both Congress’ Medicare Payment Advisory Commissionand the Congressional Budget Office have found that private insurance companies are being paid billions more than it would cost to treat the same beneficiaries under the regular Medicare program,” said New Hampshire State Representative Mike Farley. “Congress should follow the unanimous recommendation of its own expert, nonpartisan commission and act to level the playing field; it should pay private Medicare plans the same as regular Medicare. Such action would immediately benefit millions of beneficiaries, who are now being forced to pay higher Medicare premiums every month to help defray the excess costs. Such action would benefit beneficiaries even more down the road, because it would substantially strengthen Medicare’s finances for the long term. With the high costs and unmet needs in our health care system, we should not be squandering billions of taxpayer and beneficiary dollars paying private insurance companies more than regular Medicare costs so that they can reap excessive profits and fund elaborate marketing campaigns.”
“The lifeline for Medicare Advantage is the insurance lobby and the billions of dollars they've convinced Congress to pump into industry coffers at the expense of seniors who are forced to pay higher premiums. Senator Sununu needs to pull the plug on the privatization of Medicare. When the Medicare Modernization Act was passed in the dark of night in 2003, Bush’s corrupt Part D drug benefit was used like an artificial sweetener to get them to swallow a bitter privatization pill. This Congress must take action now to stop the methodical erosion of traditional Medicare.”
“There is no justification for wasting our precious resources to subsidize private companies to provide Medicare insurance that can be provided more cheaply and efficiently by traditional Medicare,” added Fran Egbers,a local activist and former member of the New Hampshire House of Representatives. “The principles that have made Medicare such a success in providing access to health care for seniors and the disabled should be used as a model to solve America’s overall health care crises. Instead the so called ‘Medicare Advantage’ program is infecting Medicare with the worst problems of the American health insurance system. Congress should level the playing field and pay private Medicare plans neither more nor less than regular Medicare.”
Among the groups participating in the ‘Stop Medicare Privatization’campaign: Americans United for Change; the NationalCommittee to Preserve Social Security and Medicare; AmericanFederation of State, County and Municipal Employees (AFSCME); Alliancefor Retired Americans; Medicare Rights Center; Campaign for America’s Future and USAction.
STOP MEDICARE PRIVATIZATION CAMPAIGN
CongressMust Act to Stop the Privatization of Medicare
As a major battle looms in Congressover the future of the so-called “Medicare Advantage” program– a program which provides huge subsidies to big private insurancecompanies that provide Medicare insurance – leading Medicare experts andadvocates have launched an aggressive, national, seven figure campaign called‘Stop Medicare Privatization.’
Two years after the American peopleresoundingly rejected Bush Administration attempts to privatize SocialSecurity, Bush has continued a stealth attempt to privatize Medicare. Theprevious Republican Congress gave huge subsidies to big insurance companiesthat were allowed to provide Medicare insurance to recipients underBush’s so called “Medicare Advantage” program.
Private insurance providers haveaggressively sought to enroll participants using part of these subsidies tolure seniors into the private plans by providing reduced premiums and specialbenefits for healthy beneficiaries. At the same time they have often cutbenefits for seniors with more health problems. In addition the New YorkTimes has documented massive use of fraudulent marketing practices by theseprivate firms.
Congressional Republicans originallypromoted “Medicare Advantage” as a “market based”approach to provide Medicare services more cheaply and efficiently. Instead private insurance companies that are part of the program now get, onaverage, a 12% subsidy above the costs of traditional Medicare. This subsidy costs the Medicare program and ultimately the taxpayers tens ofbillions of dollars at the same time it endangers the soundness of the Medicareprogram that seniors and the disabled depend upon for health care. TheMedicare actuaries report that the overpayments are advancing the date that theMedicare Hospital Insurance Trust Fund willbecome insolvent by 2 years .
There is no justification for wastingour precious resources to subsidize private companies to provide Medicareinsurance that can be provided more cheaply and efficiently by traditionalMedicare. Worse yet, byallowing these firms to “cream” healthy beneficiaries from thetraditional fee-for-service program, “Medicare Advantage”endangers the structure and soundness of the entire Medicare program. Itthreatens to undermine the fundamental principle that has made Medicare asuccess: taking the risk of a health care cost catastrophe off of the backs ofindividual families and spreading it across the largest possible risk pool.
When Medicare was passed in 1963 iteliminated the major cause of poverty and financial catastrophe for Americanseniors. It has delivered health insurance at far lessadministrative cost than any private health insurance company. Theprinciples that have made Medicare such a success in providing access to healthcare for seniors and the disabled should be used as a model to solve America’soverall health care crises. Instead the so called “MedicareAdvantage” program is infecting Medicare with the worst problems of theAmerican health insurance system.
Congress must eliminate subsidies for“Medicare Advantage” plans before overpayments destroy the one bigAmerican health insurance success story. Congress should level theplaying field and pay private Medicare plans neither more nor less than regularMedicare.