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Doctors protest the Medicare Direct Contracting program

Doctors attend a protest at the headquarters of the Health and Human Services Department on November 30, 2021 in Washington, D.C. (Photo: Physicians for a National Health Program)

Campaign Launches 'Summer of Action' to Protect Medicare From Stealth Privatization

Medicare "is under threat today from the constant efforts of private insurance companies and for-profit investors who want to privatize it and turn it into yet another shameful opportunity to make money," said Rep. Pramila Jayapal.

Kenny Stancil

Senior citizens, doctors, progressive lawmakers, and activists gathered virtually on Monday to launch a "summer of action" to prevent the back-door privatization of traditional Medicare.

"If Wall Street firms are allowed to make decisions about your healthcare, their profits will always come first."

At issue is Direct Contracting, which is set to be renamed ACO REACH—an acronym for Accountable Care Organization Realizing Equity, Access, and Community Health—in 2023.

As the campaign to protect traditional Medicare explains, the Direct Contracting scheme "invites profit-seeking middlemen to 'manage' care for seniors and people with disabilities, allowing companies to keep up to 40% of what they don't spend on care as overhead and profit."

All sorts of corporate actors can become middlemen, including Medicare Advantage insurance companies, private equity firms, and other Wall Street profiteers.

Seniors who picked traditional Medicare are being enrolled without their knowledge or consent, as the program automatically assigns beneficiaries to a Direct Contracting Entity (DCE) as long as their primary care physician has joined one. Given that finding a different primary care doctor is the only way to opt out, dozens of DCEs have already enrolled 1.8 million seniors nationwide.

These profit-maximizing third parties have plans to completely take over Medicare by the end of the decade, but progressives are gearing up to fight back, as detailed during Monday's Protect Medicare event, organized by Physicians for a National Health Program (PNHP) and titled "Turning Up the Heat on Direct Contracting and REACH."

"Despite undeniable evidence that Wall Street middlemen drive up costs and deny care, the Center for Medicare and Medicaid Services has begun to move traditional Medicare beneficiaries into a program called Direct Contracting or ACO REACH, which inserts profit-driven middlemen between seniors and their healthcare," said Rick Timmins, a member of Puget Sound Advocates for Retirement Action.

"I learned the hard way," said Timmins. He picked Medicare Advantage because of its promise to cover vision, hearing, and dental expenses but eventually experienced a life-threatening delay in treating malignant melanoma. That's because his private insurance company limited which providers he could see and even lost his doctor's request to authorize a referral to a dermatologist when it subcontracted the process to another company.

Bill Bianchi, a board member and leader with Jane Addams Senior Caucus in Chicago, meanwhile, said that "I was able to make the choice to be on traditional Medicare, and I don't want to be moved to REACH."

"Seniors are angry and afraid of what we are hearing about the REACH program," said Bianchi. "People are terrified of being transferred, without their will or consent, to a third party middleman that is allowed to keep as profit what they don't spend on our care. We know that means that Wall Street investors will be involved in our care, and they are more worried about their bottom lines than our well-being."

Timmins echoed Bianchi, warning that "if Wall Street firms are allowed to make decisions about your healthcare, their profits will always come first. Our healthcare needs will be a distant second. Please join me and do everything you can to end this dangerous program before it is too late."

Dr. Susan Rogers, president of PNHP, shared a four-part action plan:

  1. Call your members of Congress and tell them to protect Medicare by joining the fight against Direct Contracting and ACO REACH, using this sample script;
  2. Call President Joe Biden and tell him to use his executive powers to immediately end Direct Contracting and ACO REACH, using this sample script;
  3. Sign the petition against Direct Contracting and ACO REACH and share it with five of your friends this week; and
  4. Tell your Medicare story, using this handout for tips and this form to submit.

During Monday's event, Rep. Pramila Jayapal (D-Wash.) described Direct Contracting and ACO REACH as "Medicare privatization hidden in layers of bureaucracy."

The chair of the Congressional Progressive Caucus said that "even though Medicare is relied on by millions of seniors across the country, and precisely because it is so necessary and cost-effective, it is under threat today from the constant efforts of private insurance companies and for-profit investors who want to privatize it and turn it into yet another shameful opportunity to make money off of peoples' health problems."

"The Progressive Caucus is calling on the Biden administration to fully end this program," said Jayapal. "Our call has been gaining steam with the help of seniors and activists around the country."

One of them, Dee Dorsey, a board member and leader with Jane Addams Senior Caucus, said that what seemed like a simple decision 20 years ago to sign up for a Medicare Advantage plan "has meant that my pocketbook has been hit harder and harder every year."

"I know, firsthand, how inserting a profit-driven middleman in senior healthcare hurts us. That's why we need to fight REACH," said Dorsey. "I want to protect traditional Medicare for the millions of seniors who had a chance to choose it, and I want to improve and expand it to everyone in the form of Medicare for All."

"Medicare for All means no copays and drug costs for seniors and would include hearing, dental, and vision care," she added. "I am dedicated to fighting for Medicare for All because I don't want to see any other seniors—or anyone else—be forced into the same position [of] having to deal with a profit-driven middleman in our healthcare."

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