The Wall Street Journal’s Propaganda

It never fails to amaze me how the reactionary op-ed pages of The Wall Street Journal almost always put a spin on issues that’s 180 degrees from reality. In their latest editorial (‘Farewell, Medicare Advantage’, June 11, p. A18) we behold caterwauling from one paragraph to the next on how Medicare Advantage members will suffer once the Obama Administration cuts funding by about $136 billion over the next decade. (As it should!)

But even worse, is the canard that “they also want to raid Advantage to finance their new subsidies”


WHOA, WSJ! You have the issue turned on its head! It’s Medicare Advantage that’s bleeding off funds from standard Medicare to support its high flyer members who have more options, thanks to the grossly misnamed “Medicare Modernization Act” (2003). This bastardization of Medicare has run up costs by SUBSIDIZING private insurers with billions of dollars in incentives to lure in seniors, even as it seeks to render standard Medicare insolvent via Medicare Advantage's parasitic benefits.

Medicare Advantage uses on average more than $12 billion a YEAR more than standard Medicare, and the latter is also forced to subsidize it via higher premiums, though they have none of the options, and other benefits. Add to that zero COLA for Social Security this year (and quite possibly the next ) and one can see how millions of seniors on government Medicare would be suffering.

This simply can’t go on, and in any scenario to get federal deficits under control, Medicare Advantage has to be targeted. We're sorry for those who belong, but they ought to have thought several times before jumping ship from standard government Medicare because an insurance scheister offered a better deal (which could then be altered in a bait and switch))

Let’s put this even more bluntly and in wider context: The entire Medicare “Modernization” Act was effectively designed to render standard Medicare insolvent. It sought to achieve this using five built-in ploys:

1) Absolutely ruled out any re-importation of Canadian prescription drugs (which would have lowered total drug costs 50-70%)

2) Prevented the government from bargaining for the best deals similar to the Veterans Administration (again, the efect to increase costs enormously)

3)Fine print allows the providers enormous leeway over what they must offer, or not. In many cases, they can substitute lower cost generics - even if a physician explicitly asks for a higher tier 'Drug XYZ'.

4) Implementing a private -insurance based "Advantage" plan which would offer seniors more choices but at greater costs. (The costs to be partly subsidized by higher premiums to standard Medicare beneficiaries).

5) A "doughnut hole" emerges when the total cost for drugs exceeds $2,700 in any one year. Then the senior must cough up whatever needs to be paid up to $6,154 before Medicare coverage resumes.

The other despicable aspect of this noisome bill is that it was lowballed in terms of total cost from the oustset. Original estimates came in at about $400 billion, but a subsequent GAO study showed it was closer to $790 billion. Alas, the newer numbers weren't allowed to be published and distributed to the congress. Now, in hindsight, we know the total cost has been nearly double the GAO estimate, and most of the benefits have gone to the profits of PhRMa.

Indeed, one of the House Reps who read all the fine print actually exclaimed:

"This is socialism for drug companies and the insurance companies."

But then we have come to understand, as author William Greider first observed in his book 'Who Will Tell the People: The Betrayal Of American Democracy', that it is corporations and insurance companies which enjoy the benefits of socialism in this country. Meanwhile, the rest of us are obliged to submit to the dictates of "the free market" (which is really a coercive, demand market).

At the same time, Rep. Ben Cardin (MD) noted at the time that the bill had inadequate prescription coverage, prohibited federal officials from negotiating for better drug prices, would cause 2.7 million retirees with private drug plans (from then Medicare Part B) to lose coverage, spent $14 billion in tax dollars to subsidize higher-cost private plans, and put a limit on general revenue use that will cause higher taxes or lower benefits.

He also mentioned the new bill cutting $1 billion in cancer treatments and therapies for elderly patients.

By contrast to this perfidy, a true drug benefit would emulate the one in Barbados (where I lived from 1971 until 1991) where their National Formulary provides hundreds of generics to all seniors at one uniform, LOW co-pay. Obviously, our corporate-owned government wouldn’t or couldn’t go that way – lest it displease its corporate overseers who supply the bulk of capaign finances.

Alas, the WSJ - which functions as an effective propaganda arm of the corporate government- will never see this and how it has become a mouthpiece in defense of corporate socialism.