Drastic Increase in Medicare Premiums

September 13, 2004

On September 3, the federal government announced that senior citizens receiving Medicare will have their monthly premiums increased by 17 percent, the largest increase in premiums in Medicare's history.

This new increase comes after a 14% increase imposed last year.

Medicare administrators admitted that a large part of this year's increased premiums will go directly into the pockets of private insurance companies who are being subsidized by the government to offer coverage to senior citizens. In other words, the government is increasing Medicare premiums in order to rob money from the pockets of retired workers and turn it over as profits to the capitalists.

Forty-one million retired and disabled Americans rely on Medicare to meet their health care needs. But over the years, the government keeps eroding Medicare benefits while increasing the costs imposed on recipients. Today, Medicare pays, on average, only 45% of the yearly health costs of seniors. Such vital services as prescription medicines, long-term nursing care, vision and dental are not covered at all. The highly advertised new prescription drug benefit does not go into effect until 2006 and even then seniors will pay, out of their own pocket, the 80% of their first $5,000 in drug costs. Thus, in addition of Medicare co-premiums and co-payments, most seniors are forced to purchase additional private "Medigap" insurance and/or pay large out-of-pocket expenses. On average, retired workers spend more than $2,500/year or 20% of their income on medical bills.

The attacks on Medicare are an outrage. The government is refusing to guarantee even the minimal health care needs of senior citizens, who have given a lifetime of labor to the country. This is a national disgrace.

We must demand comprehensive and free health coverage for seniors and for all Americans.