The Republican goal is to privatize social security and medicare. But this doesn't necessarily have to happen in one fell swoop. It's happening quietly already with no fanfare, no outcry and right under our noses. When I signed up for Medicare in 2006, I was given the choice of signing up for traditional Medicare or the so-called Medicare Advantage plan. I should point out that this only has to do with Medicare Part B, the part that covers doctors' visits and not Part A, hospitalization, which is free. To make matters more confusing, there is Part D, the drug part, which was enacted in 2003 when they also revamped the Advantage plan which had been laying around dormant, I guess. The Advantage plan, seemingly, offers additional benefits that traditional Medicare doesn't for the same amount of money. For instance, you get a free annual physical exam which you don't get under traditional Medicare. Why not? If preventative medicine and early diagnosis save the system money in the long run not to mention human misery, you'd think the government would want every enrollee to have a free annual check-up as part of Medicare. In addition, the Advantage plan I signed up for (there are several available offered by different for profit, private corporations), Secure Horizons (part of United Health Care whose CEO Bill McGuire made $100 million last year), offered free eyeglasses every two years, an optional dental plan etc.
All these enticements were offered to get people to sign up for the Advantage plan which is privatized corporate sponsored health insurance rather than traditional government sponsored, single payer health insurance which is what Medicare is. So who wouldn't sign up for a plan that offered everything Medicare offered, but more! So what's the catch? When I signed up, I had to choose a primary physician and a hospital. I got to keep the doctor I was already going to and the hospital I would have prefered anyway so, seemingly, I was ahead of the game. I had also been going to a podiatrist for toenail fungus who was in the same network so I should have been able to keep seeing him, right? Not so fast. I needed a "referral" from my primary doctor or in other words, permission, to see the podiatrist and get reimbursed by Secure Horizons. He wouldn't give it to me because he didn't consider toenail fungus a serious enough problem to warrant my seeing the podiatrist. Neither would he treat it. So he was acting now as a "gatekeeper." Another ongoing situation was also now considered benign and nothing should be done about it. So I was denied seeing a specialist twice in a few short months. Now, granted, toenail fungus isn't life threatening, but it was covered under my Blue Cross health insurance prior to going on Medicare or Medicare Advantage. But a number of other life threatening problems have been denied to other people. That's how CEO Bill McGuire makes his $100 million, by denying people health care.
The advantage of traditional Medicare is that you can see any doctor or specialist you choose for a small co-pay. You don't need your primary physician's approval. So you can get second opinions. Another thing I found was that, as soon as I was signed up for Secure Horizons, I started getting tons of literature which, after I had waded through it, I discovered that its main purpose was to start rescinding some of the "advantages" I was enticed into signing up for in the first place. Like, for example, the "free" eyeglasses every two years. That little benefit was unobtrusively dropped. I started getting the feeling that, as time went on, any link with Medicare would be broken and I would be fully privatized right out of the system. Then my benefits would be reduced and my premiums would skyrocket.
There has been much criticism of the Medicare Advantage plans. For instance, the government literature and Medicare.gov website seems to make the Advantage plan much more attractive than traditional Medicare. The health care corporations pay the doctors more than traditional Medicare does for the same service making it more profitable for doctors to take on Advantage patients while rejecting traditional Medicare patients. Medicare Part B premiums keep going up so that the government, which pays the private corporations what they would normally charge the traditional Medicare recipient on a monthly basis, can pay them more each year making the advantage not to the patient but to the health care corporations. However, the more Medicare patients the government can off-load onto Advantage programs, the more money the government actually saves because neither the monthly premiums nor the payroll taxes that fund Medicare actually pay the full costs. It requires serpentine logic to make any sense of this but this is from the President's Executive Office of Management and Budget:
There is a common misperception that there is a Medicare surplus and that Congress must take action to preserve its assets. There is no Medicare surplus. Any excess cash collected from the payroll tax that is not used to provide hospital insurance is used for other Medicare spending such as doctor bills, which are not fully covered by premiums paid by beneficiaries. These premiums cover only about 25 percent of doctor bills and other costs paid from Medicare's other trust fund, the Part B, or Supplementary Medical Insurance trust fund. Additional funds come from the general fund of the government to cover Medicare's remaining costs. In fact, in 2002, without this general fund transfer, Medicare would face a $48 billion shortfall.
So the money essentaily comes from the government's general fund just as social security does (since the government borrows against payroll tax money collected for social security) making payroll taxes simply a farce. They are just a regressive excuse for burdening the middle class and poor while letting the rich off the hook tax wise. The increasing monthly premiums for Medicare Part B are wiping out cost of living social security increases for seniors:
Many Medicare beneficiaries could see next year’s cost-of-living increases in their Social Security checks much reduced by higher Medicare premiums that will grow by $11.60 a month in 2005, the largest annual dollar hike in Medicare’s history.
The Part B premium, which covers doctors’ and outpatient services, will rise from $66.60 to $78.20 a month, a 17.4 percent increase. Next year’s Social Security benefits, not yet announced, are expected to rise only 2 to 3 percent, the rate of general inflation.
Someone receiving a $600 check, for example, would get an extra $15 a month next year under a 2.5 percent cost-of-living increase, but the new Medicare premium would wipe out all but $3.40. "A 17 percent increase is alarming," says John Rother, AARP’s director of policy. "If that pattern repeats itself in future years, it means that nobody will get Social Security benefits that keep up with inflation."
The government under the Bush Administration is actually paying more to the private insurers per person than it's allocating for traditional Medicare. This allows the private insurers to pay its doctors more than they're paid for the same service by traditional Medicare and undermines the whole government program:
AARP's support of Medicare Advantage doesn't benefit seniors
Call it the riddle of AARP. It's truly puzzling why an organization that represents 38 million individuals 50 and over, many of whom depend on Medicare, would endorse a Medicare offshoot -- Medicare Advantage -- that siphons money from traditional Medicare and is seen by many as part of an effort to privatize Medicare.
AARP says in ads, "Discover the only Medicare Advantage health plan that carries the AARP name." The plan is provided by United Healthcare, among the nation's largest for-profit health insurers. The particular plan AARP has put its name to is a private fee-for-service plan, the fastest growing segment of Medicare Advantage, up nearly 300 percent in a recent 18-month period.
Why should anyone drop out of popular, tried and true government-run Medicare and opt for a private insurance plan?
The chief reason is that Medicare has been grossly overpaying the private plans to cover seniors who desert traditional Medicare. The generous payments make it possible to lure seniors with attractive premiums and benefits. In some places they even rebate the $93.50 monthly Part B premium. It's not unusual for Medical Advantage plans to offer enrollees free health club membership and zero premium for coverage that includes the Part D drug benefit without extra cost.
Of course, there is cost, including profits to the private insurer, but seniors are willing to enroll because it seems like such a good deal and because they may not realize that leaving traditional Medicare in the lurch weakens it for other seniors.
It seems clear that Republicans are trying to discourage seniors from enrolling in traditional Medicare and to discourage doctors from accepting traditional Medicare patients by reducing their payments for services under traditional Medicare:
The Medicare Payment Advisory Commission (MedPAC), Congress’ expert advisory body on Medicare payments, reported this month that Medicare is losing billions of dollars each year because of excessive payments to private insurance plans through the Medicare Advantage program. (Under that program, Medicare beneficiaries may elect coverage through private “Medicare Advantage” plans rather than through traditional fee-for-service Medicare.) Although private plans ostensibly were brought into Medicare to introduce competition and reduce costs, MedPAC has found that, on average, the federal government is paying the private plans 12 percent more than it costs to treat comparable beneficiaries through traditional Medicare.
This year I decided to convert back to traditional Medicare starting in 2008 for several reasons: 1) I can go to my foot doctor again for a reasonable co-pay instead of his normal $140. charge for an office visit; 2) I don't want to support Bush's privatization plan for Medicare; 3) I don't want to support CEO Bill McGuire's $100 million annual salary and 4) if I did develop a serious medical condition, I don't want to be denied health care by my primary doctor acting as gatekeeper, the gate being to 
Bill McGuire's continued profits and fortune. At least at this point you can convert back. If the Republicans had their way - and some day they may - that link would be broken and once on the Advantage plan it would be impossible to go back. Then watch your benefits reduced and your premiums rise. I was told that I would have to get a supplementary "private" drug plan since traditional Medicare doesn't have an inherent drug plan while the Advantage plan does (another one of its "advantages"). Since I don't use any prescription drugs, I hesitated to pay additional for one, but then I was told there would be a penalty if I didn't sign up right then but wanted to later - another little tool to funnel money to private corporations. So I signed up for the least expensive at $20 a month with Humana. This is another disincentive for traditional Medicare - you have to pay extra for Medicare Part D, the drug part. So traditional Medicare will cost me more each month for less benefits than the Advantage plan, and I may be rejected by some doctors who won't even service traditional Medicare patients because they don't get reimbursed enough.
The whole Advantage program, like Medicare Part D, is nothing more than a plan to privatize and corporatize Medicare. At the same time health care corporation CEOs like Bill McGuire are making obscene $100 million salaries and sitting on a billion dollars in stock options. Once seniors are on private plans and government sponsored health care is undermined till it collapses, seniors will be forced to pay through the nose for less service. And the private health care corporations will do it like they do right now by denying people who really need them expensive health care procedures.
One of President Bush’s reasons for threatening to veto the expansion of the State Children’s Health Insurance Program, known as SCHIP, is that it would be financed partly by a cutback in something called "Medicare Advantage."
If you don’t know about Medicare Advantage, that’s no surprise. It is popular in California, Florida, New York, Ohio and Pennsylvania, where more than 30 percent of Medicare beneficiaries have signed up for it. But in Maine, New Hampshire and Vermont, fewer than 3 percent belong, and some doctors have never heard of it.
Medicare Advantage, heavily promoted by the Bush administration as an alternative to "socialized medicine," is a program that pays various private health plans to provide service less available under ordinary Medicare. Critics see it as an administration wedge intended to privatize Medicare, which now serves 44 million elderly and disabled people. About 8.7 million of them, 20 percent, get expanded Medicare benefits through these private plans.
Mainers are well off to avoid these Medicare Advantage plans, as shown by a chorus of criticism and condemnation. The American Medical Association reported in May that its survey "paints a bleak picture of physicians’ experience with Medicare Advantage plans." More than half of the physicians surveyed said their patients had been denied coverage of services covered by the traditional, government run, Medicare plan. Eighty-four percent said their patients couldn’t understand how the private plans worked.
AMA’s board chairman, Dr. Cecil Wilson, said: "The private health plans were supposed to inject competition into the Medicare program, but instead we’ve ended up with a federal handout to the insurance industry." He quoted government figures to show that eliminating overpayments to insurance companies will save Medicare $65 million over five years.
