The Trump administration’s dismantling of Medicare is not a distant threat—it is a reality that is unfolding with alarming speed alongside the erosion of Social Security and the privatization of the United States Postal Service. While often framed as a partisan issue, the truth is that Medicare’s privatization is a bipartisan effort spanning decades, pushed by both Democratic and Republican administrations. The difference now is the speed and aggressiveness with which the Trump administration is executing this agenda.

From shifting funds into private hands to restructuring payment models that place financial risk on corporate entities, the administration is ensuring that Medicare—a program paid into by workers throughout their working lives—becomes a profit-making machine for the financial elite. The consequences will be devastating for the working class, leaving millions of elderly Americans with inadequate medical care, higher out-of-pocket costs, and outright denial of service. Simply put, it is a matter of life and death.

Medicare was created in 1965 as part of Lyndon B. Johnson’s Great Society initiatives, offering guaranteed healthcare to Americans over the age of 65. It was a significant achievement of the working class, wrested from a reluctant ruling elite through decades of struggle. Funded by payroll taxes, Medicare was intended as a social contract: workers would contribute during their employment years, ensuring they had healthcare security in old age. 

But this commitment was never accepted by the American ruling class and its political representatives. Almost immediately, steps were taken to begin dismantling the program, slowly shifting its financial structure and control into private hands.

The privatization of Medicare has been a bipartisan assault, carried out in stages, with the Reagan administration introducing prospective payment systems that encouraged hospital competition and opened the door to for-profit healthcare. The Clinton administration then created Medicare+Choice, which would later become Medicare Advantage (MA), allowing private insurers to profit from the program. The George W. Bush administration expanded Medicare Advantage, diverting billions to private insurers.

A systematic shift emerged from Fee-for-Service (where providers are paid per service they provide) to Value-Based Care (where payments to providers are based on patient outcomes rather than the number of services provided), moving from ensuring that patients receive care to keeping costs low to maximize profits.

The Obama administration’s Affordable Care Act (ACA) expanded privatization through the growth of Accountable Care Organizations (ACO) and value-based payments, embedding private companies deeper into the Medicare system and giving health care providers incentives to reduce overall spending.

During his first term, Trump took these efforts to a new level, rapidly dismantling traditional Medicare under the guise of reform and efficiency. Among the most significant measures, Trump aggressively introduced and expanded Direct Contracting models, allowing private insurers and investor-backed healthcare groups to take on financial risk for Medicare patients, building on Obama’s ACO models but with greater private sector involvement.

In 2019, the Centers for Medicare & Medicaid Services (CMS) launched the Primary Care First (PCF) model, which was marketed as a way to improve patient health by rewarding good care and penalizing poor performance. In reality, it primarily benefited corporate interests.

To avoid financial penalties, providers were incentivized to cut costs wherever possible. This often meant seeing more patients in less time, reducing the quality of care, limiting expensive treatments and referrals, even when medically necessary, and pushing patients into telehealth or digital consultations, which are cheaper but may not provide the same level of care as in-person visits.

PCF normalized the idea that Medicare payments should be profit-driven rather than need-based. This approach paved the way for more aggressive privatization efforts, such as Direct Contracting Entities (DCEs) and more developed ACO models, which allowed private investors and insurance companies to directly manage Medicare funds.

Additionally, the first Trump administration pushed for “Price Transparency and Site-Neutral Payments”—rules ostensibly to reduce hospital costs and promote efficiency, but, in reality, reinforcing the broader shift toward risk-based payment structures at the expense of quality service.

In risk-based models, private companies and healthcare providers agree to cover a group of patients for a set amount of money. If the care costs more than expected, the company loses money, so companies have an incentive to cut costs, often by denying treatments or limiting care.

Trump’s budgets have repeatedly proposed slashing billions from traditional Medicare while increasing funding for privatized alternatives, gutting public Medicare and accelerating its demise. The administration has also aggressively pushed Medicare Advantage, diverting resources away from the public system and forcing more seniors into private plans where insurers have financial incentives to deny care and ration services.

More recently, Robert F. Kennedy Jr. has promoted the same corporate interests, using the language of “healthcare freedom” to further dismantle public healthcare in favor of privatized alternatives.

The appointment of Dr. Mehmet Oz to head the Centers for Medicare & Medicaid Services (CMS) in Trump’s second term marks a significant escalation in the drive toward privatization, setting out to complete the decades-long process of dismantlement.

Dr. Oz, a television personality with extensive financial ties to UnitedHealth Group—serving as a medical adviser and board member for UnitedHealthcare’s Medical Advisory Board—was involved with Optum, another UnitedHealth subsidiary. A federal judge recently found Optum to be in violation of laws and its fiduciary duty because it used financial considerations to deny coverage. Oz is now being positioned to restructure Medicare into a profit-driven system.

Oz has already floated proposals to transform Medicare entirely into a system in which private entities dictate coverage and spending, ensuring that corporations, not doctors, determine who receives what type of care and who is left to suffer without it.

Trump and Oz have used the pretext of fighting fraud as an excuse to cut Medicare coverage. During his Senate confirmation hearing, Oz characterized the Medicare Advantage system—which he had consistently advocated—as “upside down.” He alleged that Medicare Advantage was more expensive than traditional Medicare, pointing to “upcoding,” a well-known practice that allows insurers to categorize patients as sicker in order to get higher payments. “I pledge if confirmed, I will go after it,” Oz stated.

While widespread fraud within Medicare Advantage has allowed private insurers to overbill the government by inflating patient risk scores, administration after administration has ignored, if not facilitated, these abuses. Now Trump is turning his focus to gutting public Medicare, pushing seniors into privatized plans.

The consequences for the most vulnerable sections of the working class will be catastrophic. Higher out-of-pocket costs will become the norm as private insurers shift the burden onto seniors through increased premiums, co-pays and deductibles. Denial of care will be widespread, as risk-based models incentivize limiting services, leading to life-threatening delays and outright rejections of treatment.

As funding is siphoned into privatized models, traditional Medicare will collapse, forcing seniors into corporate-controlled plans where profit is prioritized over patient health. Millions of elderly Americans who have paid into Medicare their entire working lives will be left without reliable healthcare, facing in their final years financial ruin or medical bankruptcy—or death.

The Democratic Party, despite its hollow rhetoric, has played a central role in dismantling the program. In recent years, the Biden administration continued Trump’s first-term policies, refusing to eliminate Medicare Advantage’s over-payments to insurers and allowing the continued expansion of privatized Medicare models.

The ruling class—Republican and Democrat alike—has demonstrated that it will not defend Medicare because its destruction represents billions in profits for Wall Street, the insurance companies, and hospital conglomerates.

Medicare will not be defended by politicians in Washington. It will only be protected through mass action by the working class. The struggle against its privatization must be tied to a broader fight against capitalism, for socialism, universal healthcare and the elimination of the for-profit healthcare industry.