Medicare:
Under the Guise of Giving Drug Coverage to Seniors, Bush Gives Them the Shaft

Feb 3, 2003

In his State of the Union address Bush spoke about a new government program to add prescription drugs to Medicare. It would cost 400 billion over ten years. The government would make contracts with private insurance companies and any senior wanting the drug coverage would have to join an HMO or PPO set up by these insurance companies.

A few years ago seniors were encouraged to join HMO’s which offered them prescription coverage plus a kind of Medicare supplement plan. But then the HMO’s and PPO’s found they weren’t making enough profit off of them and either severely cut back their benefits or dropped them. People who were dropped had to try to go back to their old plans, which often wouldn’t take them because of their medical condition, leaving them stuck not only without drug coverage, but without any Medicare supplement plan.

Now Bush is proposing a repeat of the same plan, without any improvement of the HMO’s into which seniors would be pushed. The joke–except it’s not funny–is that Bush says he’s proposing a 400 billion dollar increase even while his administration has been whittling away at Medicare spending.

The main thrust of this new spending is not to improve Medicare. It’s to give a massive subsidy to the pharmaceutical industry, which is already the most profitable industry in the country. Many seniors can’t afford drugs because of their high expense. Under Bush’s plan the government would pay part of the cost–not nearly all–for their medicines. The price of drugs wouldn’t come down at all, but sales for the corporations would go up.

No wonder the head of Abbott Laboratories, one of the biggest drug makers, praised Bush’s "prescription drug benefit."