Medicare in Crisis: The Devastating Impacts of a Corporate Health Care Bill

Pill-bottleWading through the endless debate over health care has exhausted the patience of most Americans — the zigzags, obscure language, and long-winded discussion is inherently repulsive.

But now the dust is starting to settle, and the Congressional vision for health care in the U.S. is emerging. Instead of being “progressive,” it will amount to a massive, corporate-inspired attack on American workers, the elderly, and the poor.

After months of confusion and delay, Congress has shipwrecked the popular energy over health care onto the jagged rock of corporate interests. More spectacularly, health care “reform” is being used as an opportunity to greatly advance corporate influence over social spheres long-dedicated to the working-class — seemingly harmless provisions carry with them enormous implications.

These devils hide in the details of the competing health care bills in Congress; both contain debilitating right-wing policies hidden within a progressive shell. Obama is indeed acting as the agent of change, to the great benefit of the U.S. corporate elite.

And although the final bill has yet to be crafted, there exists general agreements as to what the end version will look like. Americans will be forced to buy shoddy corporate insurance with no limit to the cost, no guarantee of quality, with large premiums and other tricks to further gouge consumers. If a public option emerges in the final bill — by no means a guarantee — it will be shrunken enough to insure very few people (2 percent of the U.S. population).

But it gets worse. How this health care “reform” will be paid for has implications that dwarf the above atrocities.

For example, the Democrats were determined to pass a health care bill that “will not add one cent to the deficit.” And they have succeeded: the House and Senate health care bills both plan to reduce the deficit by over $100 billion. But a second-grader could do the math here: more service does not equal less cost — a truism that dominates the for-profit health care industry.

So how does the government plan to save billions of dollars as they “help” millions of people?

The two biggest cost saving schemes are the most damaging. The first is the enormous attack on Medicare. Since its inception, the corporate elite wanted this program struck down. Now they have their man for the job — a Republican could never get away with such obvious treachery.

The Congressional Budget Office estimates that the Senate version of health care would cut $404 billion from Medicare and Medicaid; the house version would cut $570 billion. The final cut could be much more. Obama made the ridiculous claim that only “wasteful” parts of Medicare would be cut. The truth is far different.

One way that both Congressional health care bills will gut Medicare is referred to as “forced productivity gains” — cost saving measures essentially; trimming the fat.

What are these savings? The most mentioned device — by politicians and media alike — is the reduction of “wasteful tests” and procedures that doctors routinely perform, an idea that the health care mega-corporations love. It will save them billions, while having catastrophic effects on the health care of millions of people.

For example, the recent announcement that women will now be persuaded to cut back on screenings for breast cancer and cervical cancer have caused an uproar nationwide: people are correctly making the connection behind Congress’ “forced productivity gains” and the new “recommendations” that will be used by insurance companies to justify cutting these services, both of which will boost profits. The general agreement behind rationing health care in this way will be an attack on not only Medicare, but serve as the backbone of any health care bill passed, negatively effecting everyone unable to afford luxury health care.

Another piece of Medicare that’s being trimmed is Medicare Advantage, a favorite program of the elderly because of its comprehensive services. Premiums for this program are already rising drastically in anticipation of the health care bill’s passage, considered by Congress to be “wasteful.” Without this program, Medicare will be greatly devalued and be more appropriately named: “band-aides for seniors.”

Finally, The Senate health care bill attacks Medicare by reducing payments to doctors by 25 percent. If doctors receive such a drastic reduction in pay, they will simply refuse to see Medicare or Medicaid patients; people will thus be insured only on paper. The newly insured Medicaid patients under any new congressional bill will be sorely disappointed.

Once Medicare is undermined in the above ways, the corporate sponsored right-wing will make a very convincing argument that “Medicare doesn’t work”, leading to future cuts that will further destroy the program.

The second hidden disaster in financing a congressional health care bill is the tax on so-called “gold-plated” or “Cadillac” health insurance policies that some employers offer their workers. This tax is supposedly meant to apply to the health care policies that “elite” employees receive.

And while there should exist no complaints about taxing corporations, the motives behind this particular tax are intentionally deceiving. As it turns out, many, if not most workers in unions will be included in this tax, which, under the Senate version, will include any plan worth more than $8,000 for individuals and $21,000 for families. Hardly elite, considering the still-soaring costs for health care.

If this provision were to pass — and it’s very popular in Congress — the immediate reaction would be very predictable: employers would immediately drop their health care plans, forcing workers into the now-forced purchasing of inadequate health care. This is why unions oppose such a plan. California Democrat Pete Stark agrees: “Employers and insurers will reduce their benefits to avoid paying the proposed tax.”

Workers fortunate to have union contracts will be heavily pressured to concede their plans, which in the past they’ve sacrificed wage-increases to keep. Ultimately, employers will have a new excuse not to provide health care to workers.

Obama again used his superb intelligence to totally obscure the issue in support of the tax:

“I do think that giving a disincentive to insurance companies to offer Cadillac plans that don’t make people healthier is part of the way that we’re going to bring down health care costs for everybody over the long term.” Translation: he supports taxing the health care of union workers.

Overall, a compromise bill between the Senate and House versions will create utter disaster for the working-class. It will not signal a progressive “step in the right direction,” as many liberals claim. At minimum, it will be a step backward, though more likely such a bill will be an enormous regression, to a time where health care was the exclusive privilege of the wealthy.

The right-wing attacks on “Obamacare” — along with the media’s lack of questioning — have shielded the Democrats from any serious debate about the above questions, including many other concerns unmentioned here.

The trash legislation that Congress is producing is the direct consequence of the Democratic Party being dominated by giant corporations — in this case the health care industry. The two-party system is the political system of the corporate elite, who switch party affiliations when they find it convenient; many of them throw equal money at both parties.

A crucial prop in this broken political system needs to be removed and organized under its own strength. If the unions took their support from the Democrats, organized their members and resources into a new political party, and aggressively pushed reforms that benefited the majority of working-class Americans, U.S. democracy would be tremendously strengthened. Medicare could not only be saved, but expanded to everyone from birth to death and be considered a fundamental human right.

Shamus Cooke

Shamus Cooke is a social service worker, trade unionist, and writer for Workers Action. He can be reached at

Republished with “fair use” permission from Global Research, where it first appeared.


  1. MyLeftMind says

    We need a hero for the middle class, and Obama won’t ever be that unless we demand it from him. To do so, we need to create our own solutions, not wait to see what those crooks in Congress offer us. We need clearly planned solutions and we need to back them up with the full support of our working and middle class voters. That means we on the left will have start finding common ground with conservatives and Independents.

    That’s not as hard as you’d think, given that Americans on both sides of the aisle now realize that most of Congress has been bought off by corporate interests. The sad truth is that elected politicians screw America’s workers because each individual member of Congress stands to get richer and more powerful if they continue destroying our middle class and our economy. We’re somehow hoping that the very people who benefit from the manipulation of our government by corporate interests will somehow choose to give up their gravy train and start supporting us little guys. That’s just not going to happen.

    Once the left realizes that even Obama will prioritize corporate America and the super rich unless we demand otherwise, we can start finding solutions to our problems in spite of big business’ death grip on our government. As soon as we stop indulging in pointing fingers at conservatives, we can start creating solutions that will win wide support across our country.

    With healthcare reform it’s a no-brainer. Obama and our Democrats have created a faux health care reform bill that would be more aptly named the “Insurance Industry Profit Protection and Enhancement Act.” If this bill passes, the faux reform will be cemented in place, blocking true healthcare reform for generations. We don’t need a brand new system that costs millions of dollars to implement and billions to operate. And we certainly don’t need yet another welfare program that encourages people to NOT be productive workers. Socialized welfare-healthcare will drive independents to the GOP in the biggest backlash since Reagan. In spite of what Obama says about magically making the rich pay for this, let’s get real. When have the rich ever paid their share of taxes? Even if the original bill demands it, the backlash wave of Republicans in Congress will fix that problem for our wealthiest citizens. This healthcare bill will swamp our middle class while giving us reduced quality in healthcare.

    We need a better solution to offer our elected leaders before they implement their newest version of wealth redistribution from the middle class to the rich.

    The purpose of government is to pool our funds for centralized functions that provide for the common welfare. Roads, libraries, military defense, universities, things like that all benefit from a centralized approach to funding. Healthcare fits right in with that purpose, but we don’t need to implement a freebie welfare giveaway because that would bankrupt us. Instead, the government should simply expand our current federal single payer systems by making them available to everyone for a fee. Seniors already pay a large portion of their healthcare costs. Working Americans would be able to pay even more, because it’ll most assuredly be cheaper for both individuals and companies without the obscene CEO salaries and investor rewards.

    Why build a whole new expensive system with its own government bureaucracy and spiraling costs? All we need to do is utilize the single payer systems we currently have, but give more people access to them. Let’s kill this current faux healthcare reform bill and give our Democrats and Obama a better plan that lets people CHOOSE to buy into our federal single payer systems like Medicare. Purchasing healthcare instead of insurance for healthcare would be wildly popular with both Democrats and Republican voters. The government doesn’t pay CEOs $24 million a year with $47M golden parachutes (cough, AIG). The beauty of this plan would be that people and companies can always choose to buy crappy insurance for more money than Medicare costs them. It’s not socialized medicine, and it’s not welfare. I’m guessing the influx of money from unionized workers, public employees and individuals wanting to pay less for better healthcare that Medicare will be bolstered enough that seniors will see reduced costs as well. Democrats might even capture votes from that demographic, and will certainly score political points for supporting small business and struggling Independents like those who just elected a Republican Senator in Massachusetts.

    When the people lead, the leaders will follow. It’s time to set a direction for our President and our Democratic Party that pulls the rug out from the Insurance industry’s death grip on our government. Obama might just become the hero we all wish he was if we step up the plate ourselves and demand sensible solutions to our healthcare crisis.

  2. Alison says

    I am deeply concerned about the cuts to Medicare Advantage. As I was searching and comparing my 2010 Medicare options using the search tool at, I am already facing fewer Medicare Advantage plans, higher Medicare Advantage premiums and increases in Medicare deductibles and co-pays. And this is before passage of the health care reform bill. What will become of Medicare options once a health care reform law is in place?

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