Kucinich assails privatized Medicare "rackets"

If nothing is done to correct this situation, Kucinich said, current levels of Medicare benefits will end in 12 years.

Under Medicare Part D, established by the MMA, seniors are forced to go through “the extraneous insurance companies” and pay premiums, deductibles and co-payments to obtain prescription drugs, he said. Since the law forbids Medicare to negotiate with the drug companies, prices are excessive and traditional Medicare is being drained to pay administrative costs that are almost six times too high.

The insurance companies do negotiate rebates for some drugs, he said, but the companies keep the rebates without passing any savings onto seniors. This is even the case for seniors whose drug payments reach the coverage gap or “donut hole.” Until they pay their way out of the gap, seniors must continue to pay premiums without coverage while the insurance companies pocket $1 billion in rebates on their drugs, according to a just released study by the Congressional Committee on Oversight and Government Reform.