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White House's "reform" scheme
They're out to gut Medicare

By Lee Sustar | March 14, 2003 | Page 12

GEORGE W. Bush has an offer for the HMO bosses who ditched 2 million Medicare recipients in recent years. Come back--and we'll guarantee your profits at the expense of seniors.

The Bush administration announced its "revised" Medicare proposal last week that promises a prescription drug benefit to the 34 million people in the government-run fee-for-service health care plan--but only if they switch to plans run by HMOs and other private insurance companies.

Those who stay with traditional Medicare would get a 10 to 15 percent discount on prescription medications--which would barely make a dent in many seniors' drug costs--and catastrophic prescription coverage only after spending $4,500 or more out of their own pockets. Low-income recipients would get a measly $600 subsidy for drug costs.

Bush and his allies in the health care industry are betting that the nearly 10 million Medicare recipients with no prescription drug coverage at all will be so desperate that they'll go along with his plan. Indeed, Bush's "reform" is a crude attempt to blackmail nearly 35 million seniors and 6 million disabled people covered by Medicare into accepting privatization of the program.

Even conservative Republican Sen. Charles Grassley of Iowa was critical. "The question I need to answer is, does this take care of the needs of enough people so that there's not a club over their head to go into the new plan?"

Bruce Vladeck, who ran Medicare under the Clinton administration, told reporters that Bush's plan "strikes me as the kind of proposal the pharmaceutical companies would write if they were writing their own bill."

As a matter of fact, they did. According to the Center for Responsive Politics, pharmaceutical companies gave $30 million to Republicans and $8 million to Democrats in the last two elections. HMOs and other health care companies put another $10 million into the pockets of Republican politicians over the same period--while funneling another $5 million to Democrats.

Now it's payback time--and if Bush has his way, older Americans will suffer to ensure the bottom line of his corporate health care backers. "Almost all health plans are for-profit, and their fundamental mission is a return on equity to shareholders, not to provide the best health care with the dollars that they have available," said Helen Halpin, a health care expert at the University of California-Berkeley.

Halpin pointed out that the administrative costs of Medicare are just 3 percent--far lower than the supposedly more efficient free market, where administrative costs of 20 to 30 percent are the norm. The 6 million people in Medicare HMOs and similar private plans are already facing a squeeze on their benefits--or their outright elimination.

"Private plans have refused to serve seniors in most rural areas; have abandoned 2.4 million seniors in 'unprofitable' communities; and, in the private plans that do exist, seniors are experiencing fast-rising premiums and shrinking benefits," said Ron Pollack, executive director of Families USA, a lobbying group for health care consumers.

With the free-market priorities of Bush and Corporate America already wrecking the lives of working people, it's time to draw the line. We need to expand Medicare, not turn it over to the health care bosses--and fight for a decent national health care system for all.

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