Next meeting of Don't Cut Our Medicare is Saturday 11/20

[Martha Koester]

Saturday 11/20 10an-12pm at
the Douglass-Truth Library
2300 E Yesler Way
Seattle, WA 98122

It's bad enough that the co-chairs of the deficit commission want to
raise the Social Security retiremt age to 69, raise the age that you
can even receive Social Security to 64 and reduce benefits for current
retirees, but now there is a report out from he Debt Reduction Task
Force, Senator Pete Domenici and Dr. Alice Rivlin, Co-Chairs
recommending essentially that Medicare be privatized. Rivlin is also
on the deficit commission.

Social Security Works is planning a call-in day on November 30th,
which willl hopefully be sufficiently massive to overwhelm their
servers and phone systems. We need to make sure that our
representatives hear from us about the proposed privatization of
Medicare as well.


"Asking beneficiaries to pay more for their Medicare coverage (or
shift to a lower-cost plan) mirrors what has happened in private
insurance over the past decade, with increases in patient cost-sharing
to keep premium growth from exceeding income growth by too large a
margin. Employers have generally opted to increase patient cost-
sharing rather than increase the percentage of the premium that
employees contribute. The former keeps employees enrolled in the plan
and encourages more judicious use of health services."

From http://bipartisanpolicy.org/sites/default/files/FINAL%20DRTF%20REPORT%2011.16.10.pdf,
Strengthen Medicare for the Long Term: Transition to a Premium Support
Option


Comment by Don McCanne of PNHP

The co-chairmen of President Ombama's deficit commission advanced a
proposal that disappointed those of us who believe that the government
has an important role in promoting a healthy and secure future for all
of us. Erskine Bowles and Alan Simpson recommend reducing the deficit
by cutting back on important social programs such as Medicare and
Social Security, while failing to recommend tapping obvious potential
revenue sources in our upside-down economy. Two members of their
committee, Jan Schakowsky and Alice Rivlin, have now released
alternative proposals.

Alice Rivlin is also co-chair, along with Pete Dominici, of The Debt
Reduction Task Force from the Bipartisan Policy Center (BPC), an
organization founded by Howard Baker, Tom Daschle, Bob Dole, and
George Mitchell. Frankly, their report is also disappointing for
basically the same reasons. It is very heavy on program reductions
(though some are appropriate) and very light on seeking new revenues.

Discussed here is only one feature of the BPC recommendation:
converting Medicare to a premium support program. This had been
mentioned only cryptically in the Bowles/Simpson report, but more
details are provided in the Rivlin/Domenici report (excepts above).

Premium support was a proposal advanced a dozen years ago by John
Breaux, Bill Thomas, Bill Frist, and Bobby Jindal that barely failed
to receive a super-majority vote in their Bipartisan Medicare
Commission, and is now being trotted out again. It is a proposal to
convert Medicare from a defined benefit to a defined contribution.

Premium support places a limit on the amount that the government
contributes toward the Medicare beneficiaries' premiums, exposing
individuals to the increasing costs of health care. It then uses the
leverage of higher individual premiums to encourage "voluntary"
purchase of less expensive private plans in the marketplace.

Since private plans have much higher administrative costs, they can
achieve lower premiums only by reducing benefits or increasing out-of-
pocket costs for the beneficiaries, making coverage worse than under
the traditional Medicare program. Instead of overpaying private plans
as with the current Medicare Advantage program, the premium support
underpays the private plans but allows them to obtain the balance from
the Medicare beneficiaries. It is a plan to privatize Medicare that
can have only disastrous consequences for Medicare beneficiaries.

In sharp contrast is the proposal of Jan Schakowsky. She would balance
revenues and expenditures with the goal of reducing the deficit, as
opposed to the unstated goals of Bowles/Simpson and Rivlin/Domenici to
reduce government. Her recommended reductions in spending are
carefully targeted to programs that many in America believe should be
reduced anyway. Her proposed increased revenues not only would help
wipe out the deficit, but they also would provide corrections to the
current massive income transfer from middle-income workers to the very
wealthy - one of the greatest social injustices in modern history.

Other than improving the way we would purchase pharmaceuticals, she
has little to say about Medicare. Her position is that of protecting
what we do have. We can go her one better on that. We can improve
Medicare and then provide it for everyone. That frankly won't reduce
the deficit much, but it would provide us with much greater value for
our health care taxes.

What more could we ask for out of our government than sustainable
budgets that provide us with real value?