Trumpcare Raids Medicare To Enrich The Wealthy And Plant A Bomb

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by Nancy Altman, Founding Co-Director, Social Security Works

Trumpcare Medicare

Trumpcare is Robin Hood in reverse. It robs from the elderly, people with disabilities, and poor children to give massive tax giveaways to millionaires and billionaires.

Trumpcare slashes health-care spending by a whopping $1.2 trillion and tax revenues by an also whopping $883 billion. It robs 24 million Americans of their health insurance in order to give supersized tax breaks to the wealthiest among us. The nation’s top 400 earners have average annual incomes of $300 million. Trumpcare makes these 400 plutocrats richer, by lavishing on them average tax cuts of $7 million.

And those $7 million tax giveaways are just down payments. Trumpcare holds back $337 billion in spending cuts that can be used to offset more tax cuts for the ultra-rich, when tax “reform” is taken up later in the year.

With that formula — huge reductions in spending on Americans’ health in exchange for enormous tax cuts for the wealthy — it is not surprising that 24 million Americans will lose their health insurance, and with it, lifesaving health care. The media has focused some attention on those 24 million. It has also shined some light on Trumpcare’s devastation of Medicaid, which includes cutting Medicaid funding by $880 billion along the way to ending it as we know it.

Some light has also been shed on Trumpcare’s impact on those seniors desperately holding on until they turn 65 and go on Medicare. A 64-year-old who earns $26,500, for example, now pays $1,700 annually for her health insurance. Trumpcare – or, for people in their early sixties, the cat food proposal — would force her to pay $14,600 for the exact same coverage. That is more than half of her income! And that is just the cost of the annual premium. It doesn’t include the cost of medication, co-pays, deductibles, or non-covered items like glasses. That doesn’t leave a whole lot left over for housing and food.

While the media has highlighted the impact on Medicaid and on seniors not yet on Medicare, few have spotlighted the roadmap of destruction obviously in the works for Medicare itself. Trumpcare plants the bomb, where it will remain until the Republicans detonate it later this year and blow up Medicare.

The Republicans have certainly telegraphed their ultimate plans. Speaker Paul Ryan has been advocating the dismantling of Medicare for years. Consistent with that, as soon as the election ended, Ryan announced his intention to enact 2017 legislation ending Medicare. Ryan’s plan would force all seniors and people with disabilities onto the private market, arming them only with inadequate voucher coupons. So, that 64-year-old spending more than half her income on her premium will get no reprieve from her cat-food diet when she turns age 65.

Trump’s Secretary of Health and Human Services (HHS), Tom Price, has also been clear about the Republicans’ plans. Against all evidence, Price claims that “nothing has had a greater negative effect on the delivery of health care than the federal government’s intrusion into medicine through Medicare.” Of course, the exact opposite is true. Medicare saves lives. It allows seniors and people with disabilities, those with the greatest health needs, to obtain life-saving health care.

With true radical zeal, Price has said, “We will not rest until we make certain that government-run health care [e.g., Medicare] is ended.” Shortly after the election, Price, like Ryan, announced that the Republicans planned to enact Medicare privatization in the first six to eight months of the Trump administration.

While Ryan and Trump’s HHS Secretary have been open about their destructive Medicare plans, they have been quiet about the Trumpcare bomb. To be able to recognize the bomb, it is important to know that Ryan is using two lies to get at Medicare. First, he falsely claims that “because of Obamacare, Medicare is going broke,” when in fact the Affordable Care Act strengthened Medicare’s financing. Second, as he does with Social Security, Ryan falsely claims that, because Medicare is going broke, it’s necessary to “reform” it in order to “save” it. (He apparently is using “save,” in the same Orwellian way it was used during the Vietnam war, when a U.S. military officer explained, “It became necessary to destroy the town to save it.”)

Now here’s the ticking time bomb: Trumpcare raids Medicare of $117 billion and puts it into the pockets of the rich. That raiding of Medicare, along with a provision that increases Medicare’s hospital payments by $43 billion, paves the way for further destructive action later in the year.

Most people would argue that the problem with Medicare is that it does not cover basic health care needs like dental care and huge expenses like long-term care. In contrast, Ryan lies that the problem with Medicare is that it’s going broke. So, what is his Trumpcare bomb…I mean… solution? Cut Medicare’s dedicated revenue to give a tax break to the rich and increase its costs.

The lead-up to the actual destruction is not hard to foresee: Ryan, Price, and their co-conspirators will claim that they have to “save” Medicare because it is going broke even faster than before Trumpcare was enacted. They are like a banker who robs a homeowner-client, and then forecloses because the money the homeowner was planning to use to pay the mortgage was stolen.

Like the banker throwing the robbed homeowner out on the street, Ryan’s plan is to replace Medicare’s guarantee with wholly inadequate vouchers. The Ryan -Trump plan would force the Medicare beneficiaries with the greatest health care needs to shoulder higher premiums and higher out-of-pocket costs, if they could afford insurance at all.

Contrary to Ryan’s characterization of Medicare as a problem, it is a solution. Roughly 1 in 5 Americans receives health care coverage through Medicare, including 46.3 million seniors and 9 million Americans with disabilities. These are benefits that beneficiaries have earned, paid for, and deserve. Despite the fact that Medicare covers those in the population with the highest health care needs, it is far more efficient than its private sector counterparts. In 2015, administrative expenses accounted for just 1.4 percent of all Medicare expenditures — compared to private insurers’ combined administrative expenses and profits that eat up 20 percent of customers’ premium payments.

Indeed, the private insurance that Medicare beneficiaries have the option to purchase through Medicare Advantage — a Republican enactment that offers a privately run alternative to Medicare — is more expensive than traditional Medicare. Indeed, the federal government pays 14 percent more per beneficiary for Medicare Advantage enrollees than for those in traditional Medicare. Even so, fewer than one-third of Medicare beneficiaries choose to purchase Medicare Advantage plans, because traditional Medicare is better.

Given Medicare’s proven track record of success and its overwhelming popularity, why do Ryan and his fellow Republicans want to destroy it? First, he has made clear he wants to find room in the budget for further tax cuts. Providing beneficiaries with vouchers opens up that room by shifting costs from the government balance sheets to the shoulders of seniors and people with disabilities who will not be able to absorb them and could wind up with no insurance whatsoever.

The second reason is more fundamental. It is ideological. Medicare, together with Social Security, disproves Ryan’s and his fellow Republicans’ seemingly religious belief that everything the private sector does is better than when it is done collectively through the government. Medicare’s health insurance, like Social Security’s wage insurance, puts the lie to that claim. Those are two programs that work better than their private sector counterparts. Pragmatists, concerned only about what works best, favor expanding both Social Security and Medicare. Ideologues, like Ryan, want to end them.

The best replacement for the Affordable Care Act would be Medicare for All. Covering all Americans under Medicare would reduce overall health-care costs, streamline the fragmented and complex public-private healthcare system that Americans are forced to navigate today, and ensure that limited incomes and pre-existing conditions do not prevent individuals from obtaining vital and medically necessary care.

If Republicans want to repeal and replace Obamacare, while lowering costs and ensuring that everyone is covered, they should propose Medicare for All. That would get Democratic support and, more importantly, the support of the American people. But, instead, their plan is to blow up this popular and important institution. It is up to all of us to stop them.

Nancy J. Altman is founding co-director of Social Security Works. Email wavering Republican Senators today and tell them to vote NO on Trumpcare!

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