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Bush Set to Cut Medicare, Medicaid

by Payson Schwin, Jan 31, 2008

Some 47 million people in this country have no health insurance. The baby boom generation is approaching retirement. Health care costs and premiums are soaring. And employer-provided health benefits are harder than ever to come by—for both current workers and retirees.

But rather than strengthen the programs the aging U.S. public increasingly depends upon—Medicare and Medicaid—Bush wants to slash these programs—$91 billion over five years for Medicare and $14 billion for Medicaid.

Edward Coyle, executive director of the Alliance for Retired Americans, says:

President Bush is attacking the most vulnerable—seniors who need Medicare to afford to see a doctor—while at the same time giving billions in subsidies to insurance companies to run privatized Medicare plans. And while many retirees continue to pay more for their prescriptions, the administration bans Medicare from negotiating volume discounts with the big drug companies. Is this what Bush meant by being a “compassionate conservative?”

Bush’s final “lame-duck” budget proposal, targets hospitals and other health care providers:

Most of the Medicare savings in the budget would be achieved by reducing the annual update in federal payments to hospitals, nursing homes, hospices, ambulances and home care agencies.[…]

In the next five years, the largest amount of Medicare savings, by far, would come from hospitals: $15 billion from an across-the-board reduction in the annual updates for inpatient care; $25 billion from special payments to hospitals serving large numbers of poor people; and $20 billion from capital payments for the construction of hospital buildings and the purchase of equipment.

(As Bush spends his “lame-duck” year doing his best to make our health care system worse, the AFL-CIO union movement is fighting to secure, high-quality health care for all. Learn more about the campaign here, and tell us your health care story here.)

Eviscerating provider payments will only hurt those who count on Medicare and Medicaid coverage. Here’s what Families USA said about a similar Bush effort last year:

Cuts in provider payments will make participating in Medicare less attractive for many providers, thus reducing beneficiaries’ access to needed care. Providers will likely also respond by reducing services or by passing costs on to beneficiaries and private payers.…The end result will be reduced access and lower quality of care or continued rising costs for beneficiaries and employers—or both.

Also, these cuts would shift health care costs to the states, making it more difficult for them to expand coverage to those who need it.

One way to strengthen the Medicare program is to cut payments made to private insurance companies through “Medicare Advantage.” Some 20 percent of beneficiaries have opted into these plans, even though Medicare pays 12 percent more under this arrangement than they do under traditional Medicare.

The Congressional Budget Office (CBO) estimates that curbing these overpayments to private insurance companies could save the Medicare program up to $150 billion over 10 years.

More important, draconian budget cuts do nothing to solve the bigger problems facing our health care system—skyrocketing health care costs, increasing premiums and the millions of uninsured.

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4 Comments

  1. Cynical on 01.02.2008 at 14:49 (Reply)

    “Bush Set to Cut Medicare, Medicaid”
    This probably would only apply to American citizens, not illegal aliens.

  2. TrueDemocrat on 01.02.2008 at 15:38 (Reply)

    are you referring to those in hanger 51?

    the dictator needs the money to fund his “war” where according to him, are making strides…eh.. progress…the surge is working…freedom…..eh..eh….children going to school, women are being treated as equals…eh.. protecting our nation…brave men and women in uniform..eh… eh…(what other lies can I tell?)

    12 months and the dictatorship is over!! We will be free!! What?
    President Hillary? NO!!!!!!!!…………………….

  3. union friend on 03.02.2008 at 14:31 (Reply)

    GRRRRRRR!!!! Yes, I’m angry as hell, for more reasons than you can count. I know too many people who have no health insurance, and too many people who need care and cannot afford to get it. Maybe if Bush and all the others who are contributing to our health care disaster DIDN’T have health care and had no money to pay for care, then maybe they would see things differently - maybe. I however, am inclined to believe that Bush and the rest truly believe they are better than anyone else, and therefore, the needs of everyone else simply does not matter. Poor qualifications, I must say, to be president of the United States. Poor qualifications for leadership at any level!

  4. Dutch Nurse on 04.02.2008 at 10:10 (Reply)

    There’s little doubt in my mind that we are dealing with a maniac who is hell bent on killing middle class and working people. He should be in jail for all the damage he has done and now this. But what do you expect from a non elected guy who has killed over 1 million Iraqis and 4 thousand of our brothers and sisters.

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