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The Nation’s John Nichols talks about the great things Medicare has accomplished — and how to lower costs without gutting it. As you can imagine, he doesn’t think much of Rep. Paul Ryan’s approach: Forty-five years ago this week, the first Medicare checks were delivered, and the United States made a great leap forward. Before Medicare was implemented—as a social-welfare program designed not just to deliver care but to poverty— one in five Americans lived below the poverty line. After the program was implemented, and after related “War on Poverty” initiatives were developed, that number was cut almost in half. Poverty among seniors dropped by two thirds. Why? Before Medicare, millions of elderly Americans could not afford to buy healthcare. They did not have access even to basic care. When they needed treatment for the inevitable ailments that are associated with aging, they and their families spent down what meager savings that retained and a stumble into poverty soon followed. Medicare broke the vicious cycle for the elderly, as Medicaid did for disabled Americans and their families. “For more than four decades, Medicare has kept millions of our senior citizens from living out their days in poverty,” explains one of the program’s steadiest champions, Congresswoman Tammy Baldwin, D-Wisconsin. Medicare continues to serve the purpose for which it was created. Indeed, so much good continues to come of this program—and of Medicaid—that it is difficult to imagine why anyone who seek to dismantle the program. But that is precisely what House Budget Committee chairman Paul Ryan, R-Janesville, is trying to do. The right reform now is not the Ryan plan. It is the proposal by Representatives Henry A. Waxman, Sander Levin, Pete Stark, John D. Dingell, George Miller and Rob Andrews that would save the government billions by reducing Medicare Part D drug costs for taxpayers. This legislation, the Medicare Drug Savings Act of 2011 (H.R. 2190), would save more than $100 billion. How? By eliminating the sweetheart deal for brand-name drug manufacturers that was developed by the Bush-Cheney administration and its congressional allies and that allows these multinational corporations to charge Medicare higher prices for millions of low-income enrollees in the Medicare Part D program. “Instead of making devastating cuts to programs that help low-income and middle-income Americans, as Republicans keep putting on the table, we should do what every other industrialized country does and ask the pharmaceutical industry, one of the wealthiest in the world, to chip in,” says California Congressman Stark, the ranking member of the House Ways and Means Committee’s Subcommittee on Health. “What’s more, the savings from this legislation could pay for a multi-year ‘doc fix’—something we tried to do in a comprehensive way but have had to address yearly so Medicare’s payments to doctors aren’t slashed.” Medicare can be reformed the right way. It is not broken. And it is not broke. Contrast this approach with that of the Administration and Congress members : ¶ Gradually eliminate Medicare payments to hospitals for bad debts that result when beneficiaries fail to pay deductibles and co-payments. Medicare reimburses hospitals for 70 percent of such debts after the hospitals make reasonable efforts to collect the unpaid amounts. ¶ Reduce Medicare payments to teaching hospitals for the costs of training doctors, caring for sicker patients and providing specialized services like trauma care and organ transplants . Medicare spends $9.5 billion a year for its share of those costs. ¶ Reduce the federal share of payments to health care providers treating low-income people under Medicaid and the Children’s Health Insurance Program. The administration wants to establish a single “blended rate” for each state. The federal government now reimburses states at different rates for different groups of people and different services in the two programs. Representative Henry A. Waxman of California, the senior Democrat on the Energy and Commerce Committee and an architect of Medicaid, said he was “very concerned” that this proposal would reduce the federal contribution to Medicaid and shift costs to states.