Medicare Fact Sheet

Medicare is the nation’s largest and most successful health insurance system serving the health needs of 40 million senior and disabled beneficiaries.

Medicare beneficiaries on average are spending about 20 percent of their incomes for health needs—far higher than younger age groups—particularly for prescription drugs. Older persons are 13 percent of the U.S. population but account for 34 percent of all prescriptions dispensed and 43 cents of every dollar spent on prescription drugs.
One of Medicare’s most important characteristics is that it is a social insurance entitlement and not a welfare benefit available only to the very poor.

Medicare is very popular: 95 percent of Americans of all ages think it is important that Medicare be preserved for everyone at retirement.
Medicare is solvent for at least the next 23 years according to the most recent Medicare Board of Trustees report.

Medicare is financially efficient—administrative costs average only 2 percent of program outlays compared with 25 percent in private small group market plans and 5-6 percent in the large market plans.

Coverage under private retiree benefit programs, the Medicare + Choice program, and Medigap plans is declining while beneficiary costs are becoming increasingly unaffordable for most seniors.

Medicare HMOs are a failed experiment and they should not be used as the prototype for other Medicare changes such as a prescription drug program.

The Medicare program does not cover the costs of physical exams, dental health, eyeglasses, hearing aids and foot care which are particularly important to seniors.

Thousands of Americans who are forced to retire before age 65 and who do not have continuing employer health coverage face huge costs for even minimal health insurance coverage.

Bush Administration Proposals

The Bush Administration plans to privatize the Medicare program through creation of a tiered health insurance program under which:

Beneficiaries staying in traditional Medicare would only receive a Rx discount card to help them with their Rx drug costs and would lose their choice of doctors, experience increased out-of-pocket costs, and face loss of benefits.

Other beneficiaries would be enticed to leave Medicare for plans run by private insurers.

Medicare would no longer be an entitlement but would become a part of the private health insurance market.

The BCTGM POSITION

The BCTGM supports a strengthened Medicare program with expanded benefits including a prescription drug benefit; physical exams, dental health, eyeglasses, hearing aids and foot care; affordable home and community-based long term care; rehabilitative, nursing home and other vital services, and extended preventive services without co-payments.

The BCTGM supports a prescription drug benefit under Medicare that is: universal, voluntary, affordable, not means-tested but particularly protects low and moderate income persons and those with high out-of-pocket costs, and which includes a system of cost control as well as strong maintenance of effort provisions covering employer provided retiree benefits.

The BCTGM opposes any premium support, voucher plan or undermining of federal administration of Medicare by turning it, or any part of it, over to insurance companies and other private sector plans.

Medicare and Prescription Drugs

New Medicare Prescription Drug Plan Falls Short! 06/10/03

Links & Resources