Whereas, traditional Medicare was created in 1965 as a public good to provide a national health care system for seniors and the disabled in the United States and has proven to be our most efficient and effective public health care program with administrative costs accounting for only 2-3% of Medicare spending; and

Whereas, since the federal government has created various for-profit privatized health care programs within Medicare including Medicare Part D (prescription drugs), MediGap (supplemental plans to cover Medicare’s 20% copays), and Medicare Advantage which is permitted to take up to 15% of every Medicare dollar for administration and profits for managing Medicare claims; and

Whereas, the first Trump administration doubled down on privatizing Medicare through the Direct Contracting Pilot, rebranded under the Biden Administration as ACO-REACH, which allows private equity firms and Wall Street companies to take up to 25% or more of every Medicare dollar for administration and profits for managing Medicare claims; and

Whereas, recent reports by the Health and Human Services (HHS) Inspector General, academic researchers, and investigative journalists have uncovered wide-ranging fraudulent practices, confirming that upcoding, overpayments, delaying medically necessary care, and the denial of claims by insurers and other private businesses managing Medicare claims, together, account for defrauding the Medicare Trust Fund and Medicare beneficiaries by as much as $75 to $140 billion annually; and

Whereas, insurers and Wall Street are fiercely lobbying to gain a larger share of the soon-to-be $1.6 trillion of annual Medicare spending by further privatizing Medicare turning it into a profit center, thus hastening the depletion of the Medicare Trust Fund at a time when Medicare beneficiaries are among the most vulnerable populations served in health care, and need more, not fewer benefits;

Whereas, steps toward increasing healthcare equity would include:

• Eliminating the Traditional Medicare 20% co-pays and setting an out-of-pocket cap on medical expenses,
• Adding benefits to Traditional Medicare that are permitted in private Medicare Advantage plans (i.e. adding vision, dental, and hearing,)
• Eliminating the excessive administrative costs and profits in the Medicare Advantage and ACO-REACH programs, and
• Recouping funds for the Medicare Trust Fund from the Medicare Advantage overpayments, fraud, and abuse that have been documented in academic studies, Congressional reports, and investigations by the Department of HSH to support a robust Traditional Medicare system that will lower costs and improve benefits, access, and equity in Traditional Medicare for all seniors and disabled beneficiaries;

Therefore, be it resolved that CFT states its opposition to Medicare privatization and urges our federal legislators to level the playing field between Traditional Medicare and Medicare Advantage so that Medicare beneficiaries will not suffer additional costs by choosing Traditional Medicare and will have a genuine choice between the public and private program; and

Be it further resolved, that CFT will work with other unions and stakeholders to oppose all efforts to further privatize the Medicare system; and

Be it further resolved, that CFT reaffirm its historic support by fighting back against this privatization and fighting forward for improved Medicare for all and universal single payer healthcare.

Be it finally resolved, that CFT will send a copy of this resolution to the national AFT, our two U.S. Senators and our Congressional House members.

Submitted by the Retirement Policy Committee