No Cuts in Medicare Benefits

Mitch McConnell and the other Republican allies of the health insurance industry have been arguing that President Obama’s health care reform bill will cut benefits from Medicare in order to pay for reform. This lie is seriously scaring senior citizens. It is regrettable that politics drives these politicians to engage in such distortions. Why can’t they oppose health care reforms without lying?

The truth is that under the President’s plan for health care reform there will be no reduction in Medicare benefits and people will continue to have the same coverage that they have always had. The President has been repeatedly questioned about this at forums he has held around the country. People want to know how he is going to cut the cost of Medicare without cutting benefits. "Nobody is talking about trying to change Medicare benefits," he said. "What we do want is to eliminate some of the waste that is being paid for out of the Medicare trust fund." He cited $177 billion of government subsidies paid to insurance companies participating in Medicare Advantage, a Medicare benefits program run by private insurance companies.

Medicare Advantage is a hugely wasteful Medicare-type program of private insurance that is, for some reason, subsidized by the federal government. It was installed when the Republicans controlled congress. They did it in the belief that private enterprise could run Medicare better than the government. They turned-out to be dead wrong. It costs 17 percent more, on average, to cover a beneficiary under Medicare Advantage than under regular Medicare. Because the program is run by private insurance companies, nearly half of its excess payments go to administrative costs, marketing, and profits, rather than to additional health benefits to enrollees

If Medicare Advantage was eliminated, participants would lose nothing. They would simply go on regular Medicare which provides the same coverage for billions less in taxpayer funds. With an extra $177 billion, the government will be able to strengthen Medicare and its benefits, not cut it.

The House health care reform bill actually gives Medicare an additional $340 billion over the next decade to provide improved care so that seniors do not have to be readmitted to the hospital to correct mistakes. To save money, the bill lowers the amount of subsidies to hospitals for such readmissions and lowers the automatic annual increases to hospitals. None of this will result in cuts in benefits, and readmitted seniors will still receive full coverage, but it will provide better care to seniors while saving the Medicare Trust Fund billions of dollars.

Although the AARP has not specifically endorsed any of the health reform bills in Congress, one of AARP’s new print ads reads: “Special interest groups are trying to block progress on health care reform using myths and scare tactics. The opponents of reform will stop at nothing to derail the process and protect their own vested interests—even if it means misleading older Americans”

In a recent press release, the AARP said: “AARP’s advertising campaign will bust the myths some are spreading to frighten Americans, including false assertions that fixing the health care system will lead to rationed health care, a government takeover, or even euthanasia. We won’t stand idle when opponents of health care reform attempt to scare or mislead the American people—and older Americans in particular—about what fixing the system really means. The truth is we need to fix health care, whether it’s ensuring affordable coverage for Americans age 50 to 64 or improving benefits for people in Medicare. It’s time for the public to get the real facts.”

Shame on the insurance companies and congressional Republicans for trying to scare senior citizens! Shame on them for claiming that under health care reform there will be cuts in Medicare benefits.