Trump’s Executive Order, Backdoor Privatization of Medicare – Updated

Trump’s Executive Order is Backdoor Privatization of Medicare,” Social Security Works, Nancy Altman, October 3, 2019

Thursday and I had to search around for someone who is an expert on Medicare Advantage Plans and Original Medicare. Nancy is one of those experts. Friday and Andrew Sprung has his commentary Trump’s Bid To Destroy Medicare up on xpostfactoid blog.

Commercial Healthcare Insurance has been become more and more expensive over the years with copays increasing, deductibles increasing, and premiums going up. Todays commercial healthcare insurance costs a single person ~$7200 and a family ~$20,000 with the single person paying 18% of the premium and a family paying 31% of the premium. Approximately 36 million people make less than $25,000 annually (retail workers, personal care attendants, warehouse workers and others as well). In a crude calculation, xpostfactoid: “The past ten years of healthcare cost increase relative to wage increase might cost a full-time average wage earner with family coverage $3,000-$4,000 this year in added costs and decreased wages, or, say, 6-8% of income.”

Today’s Employer sponsored Healthcare Insurance is unsustainable. The same holds true for Medicare Advantage plans due to the Commercial healthcare Insurance offering it as well. There are few controls which can be applied on the commercial side of the healthcare industry which is why there is a big push for true single payer healthcare of which Medicare and Medicaid are. If you wish more detail on how commercial healthcare insurance has exploded in cost, my earlier post Health Benefits for 2019: Premiums Inch Higher, Employers Respond To Federal Policy offers more detail pictorially and in verbiage.

As I have written other times, Medicare and Medicaid have been instrumental in reducing excessive U.S. healthcare costs. Medicare and Medicaid set the prices paid to providers with provider input and commercial healthcare insurance uses those prices to set their payouts. Medicare hospital rates are an approximate half of those paid on average by commercial healthcare insurance. Rates paid to physicians average about 78% of commercial insurance rates. In high-demand specialties and in regions with fewer providers; commercial healthcare insurers often pay four, five and six times Medicare rates. If you remember from Kocher and Berwick’s article, they proposed setting commercial Healthcare (while it still exited in the interim) payouts at 120% of Medicare rates.

This action by Trump and Republicans is a huge giveaway to the commercial healthcare insurance sector and the healthcare industry. Right now Medicare Advantage uses Medicare rates. If they can beat Medicare Rates, they keep the difference. If they can not meet the rates, the consumer pays the difference. What Trump has done is reverse the format. Medicare Advantage Negotiated Rates will be used to set Medicare Fee For Service rates to providers.

Past the leap is the President of Social “Security Works” Nancy Altman’s statement on Trump’s Executive Order talking about Trump’s lies.

(Washington, DC) — The following is a statement from Nancy Altman, President of Social Security Works, on the Medicare executive order Donald Trump is signed today:

“Medicare Advantage is a hustle designed to allow for-profit corporations to suck up public dollars. For years, Republicans have shoveled money into Medicare Advantage plans and allowed them to offer benefits that traditional Medicare is forbidden from covering. This is a ploy to push seniors into Medicare Advantage plans instead of traditional Medicare. Medicare Advantage is stealth privatization intended to undermine traditional Medicare, which is an effective, popular government program and therefore loathed by Republican ideologues.

Under the Trump Administration, the thumb on the scale has turned into an entire arm. They’ve been flooding seniors’ inboxes with advertisements for Medicare Advantage. What these emails don’t mention is that Medicare Advantage plans often have narrow networks, restricting which doctors and hospitals patients are allowed to use. Worse, a recent government report found tt Medicare Advantage plans improperly deny care “in an attempt to increase their profits.” It’s no surprise that older, seniors are more likely to drop Medicare Advantage plans.

Medicare Advantage plans are also a terrible waste of public dollars. They have overcharged Medicare by $30 billion in the past three years alone.

Today’s executive order is yet another giveaway to the corporations that run Medicare Advantage plans. Ironically, the Trump Administration is framing the executive order as an attack on Medicare for All. In fact, the massive flaws of Medicare Advantage epitomize the need to get for-profit greed out of health care by improving Medicare and expanding it to cover all Americans.

Medicare, like Social Security, works. Republicans want to privatize both of them. We have to stop them and instead, expand both.”

The data is out there. I have brought much of it here to Angry Bear. Andrew Sprung at Xpostfactoid is looked to as an expert as well as others. If  you have a question ask. If I can not answer it, I can find out.

Run75441 (Bill H)