President Joe Biden has passed on his best chance to operationalize his stated goal of reducing the role in U.S. security policy of America’s more than 5,400 nuclear weapons with the public release on October 27 of the Nuclear Posture Review (NPR).
Biden is now the 14th president over eight decades to attempt to reconcile the risks that derive from nuclear deployments with the demands of deterrence. He has discovered how difficult this can be.
Biden’s NPR adjusts nuclear policy and programs at the margins while making no significant changes to the Pentagon’s budgets and deployments. It endorsed dozens of nuclear-weapons programs that will cost an estimated $634 billion over this decade, according to a May 2021 assessment from the Congressional Budget Office. Including in that estimate missile defense programs, weapons programs added after the Congress report and expected inflation could bring the cost to almost $1 trillion per decade for several decades to come.
This includes proceeding with a new land-based, long-range missile rushed toward production in the last months of the Trump administration without examining less expensive and less dangerous alternatives to its production. That project alone could cost $264 billion overall.
This failure is not unique to Biden. Every president in the nuclear age has struggled to control the weapons supposedly under his sole authority. Primarily this is because U.S. nuclear posture is not a rational response to an external threat environment. It is driven by those who see nuclear superiority as a tool of global power, those who use nuclear security as a wedge issue in partisan politics, and by those powerful arms corporations that realize vast profits from manufacturing, marketing, and maintaining these deadly arsenals.
The question is complicated by a process that gives those most interested in continuing nuclear programs the authority to write the policy governing these weapons. The Pentagon controls the pen. Biden appears to have concluded that it is too costly in political terms to fight for his views, which included repeated statements that the United States has no need to ever use a nuclear weapon first. He has let the Pentagon dictate his strategy rather than challenge a bureaucracy resisting any alteration of current programs and doctrine.
Elsewhere, I have detailed how a safer, more rational nuclear policy could have included, among other steps, reducing the number of deployed strategic warheads by one-third, to about 1,000, taking nuclear-armed missiles off hair-trigger alert, embracing no first use or sole purpose doctrines, and requiring an additional senior official to authorize launch. Pacts such as AUKUS that encourage the spread of nuclear weapons technology must also be rethought.
But consideration of these and other steps were effective excluded early in the process when the Defense Department fired then-Deputy Assistant Secretary of Defense Leanor Tomero, whom Biden had placed in charge of nuclear and missile defense policy and who had been pressing, following Biden’s presidential guidance, for consideration of some of the alternatives. According to knowledgeable sources, Pentagon staff complained to Republican staff on the Senate Armed Services Committee that Tomero wasn’t sufficiently supportive of “nuclear modernization”—the euphemism for the mountain of contracts that drive the nuclear posture.
Tomero was an early casualty of an entrenched nuclear bureaucracy fiercely protective of its contracts, secrecy, and privilege. As American University Professor Sharon Weiner wrote: “The nuclear weapons establishment will limit choice by presenting everything as an interlocking set of military requirements instead of multiple options for meeting deterrence goals.” She was right.
As Weiner predicted and the NPR reflects,
These options will likely allow, at best, only narrow deviations from the status quo.
President Bill Clinton was the first to issue an NPR in 1994; Biden should be the last. Policy should flow from the White House to executing departments, not the reverse. Let this be the end of a flawed, inadequate, and dangerous nuclear posture review process.
The Bulletin of Atomic Scientists equips the public, policymakers, and scientists with the information needed to reduce man-made threats to our existence.
Members of Veterans for Peace rally in front of the Lincoln Memorial on May 30, 2017 in Washington, D.C. (Photo: Chip Somodevilla/Getty Images)
Letter to President Biden from Gerry Condon, former president of Veterans For Peace.
Dear President Biden,
I am writing you as a proud member of Veterans For Peace and its former president. We have been following the war in Ukraine closely, since well before the Russian invasion on February 24 of this year. We were alarmed when you and President Obama supported the regime-change coup in Ukraine in 2014, which was openly cheered on by the State Department’s Victoria Nuland, and spearheaded by self-described Nazis.
We watched in horror as those same self-described Nazis set fire to an Odessa union building full of Ukrainians who were protesting a new law outlawing the Russian language as an official language of Ukraine. 50 people were burned alive or shot and beaten to death. This in a country with a long history with Russia and millions of Russian speakers.
Appalled at the aforementioned atrocities, the Russian-speaking population of the Donbass in Eastern Ukraine declared their independence from Ukraine, and were soon attacked by Nazi militias. These self-described Nazi militias were then incorporated into the Ukrainian army, and the attacks continued. By the time that Russia invaded Ukraine on February 24 of this year, 14,000 Ukrainians had already been killed in that terrible civil war.
Russian president Putin repeatedly warned and almost begged the US and NATO: Do not push your hostile military forces any further onto Russia’s borders. Taking Ukraine into NATO would cross a serious “red line.” Russian troops then massed along the border with Ukraine, in a clear show of force.
Mr. President, you might have stopped this war from happening merely by announcing that Ukraine would not become part of NATO and that you would end the militarization of Ukraine. You could have accepted President Putin’s offer to negotiate a new security arrangement in Europe. We looked on in disbelief as you rather cavalierly brushed aside Russia’s legitimate concerns. It looked like you were saying, “Bring it on!”
Well, Russia brought it on. We were horrified by the Russian invasion as well as by your response. You armed Ukraine to the teeth and fanned the flames of war. Ukraine (and the Black market in Europe) is now awash with high-tech US weaponry. A full-on war has killed many thousands of civilians, made millions homeless, and destabilized much of the world. We are now facing economic disasters and fearing the all-too-real possibility of nuclear war. Why?
As veterans who have experienced the carnage of war, we are concerned about the young soldiers on both sides who are being killed and injured in the tens of thousands. We know all too well that the survivors will be traumatized and scarred for life. These are additional reasons why the Ukraine war must end now.
We ask you to listen to veterans who say “Enough is Enough—War is Not the Answer.” We want urgent, good faith diplomacy to end the war in Ukraine, not more US weapons, advisors, and endless war. And certainly not a nuclear war.
It is not too late to do avoid further disaster, Mr. President. It is never too late to do the right thing. Show us a Profile of Courage and save the world from World War III, a war that could literally destroy human civilization as we know it. You must distance yourself from the neocons and weapons manufacturers who are giving you terrible advice. You must reverse course now. Drop the weapons and embrace diplomacy. For the sake of Ukraine. For the sake Russia, Europe and the United States. For the sake of the all the peoples of the world.
Negotiate, Don’t Escalate!
Gerry Condon, former president VETERANS FOR PEACE
Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.
Gerry Condon is a Vietnam-era veteran and former president of Veterans For Peace.
Sen. Bernie Sanders (I-Vt.) speaks at a rally in Washington, D.C. on June 24, 2021. (Photo: Saul Loeb/AFP via Getty Images)
“The function of a rational healthcare system is to provide quality care to all in a cost-effective way, not make billionaires like Jeff Bezos even richer,” said the Vermont senator.
Sen. Bernie Sanders on Thursday joined the chorus of progressive voices demanding that the U.S. government reject Amazon’s purchase of One Medical, a subscription-based health services provider headquartered in San Francisco.
“The function of a rational healthcare system is to provide quality care to all in a cost-effective way, not make billionaires like Jeff Bezos even richer,” the Vermont Independent wrote on social media, referring to Amazon’s ultrawealthy founder and executive chairman. “At a time of growing concentration of ownership, the Justice Department must deny Amazon’s acquisition of One Medical.”
Sanders was echoing anti-monopoly advocates and privacy defenders who have sounded the alarm over Amazon’s “dangerous” $3.9 billion buyout of One Medical—a private equity-backed company that charges its 767,000 members roughly $200 in annual concierge fees to access a network of 188 primary care clinics.
“Allowing Amazon to control the healthcare data for another 700,000+ individuals is terrifying,” Krista Brown, a senior policy analyst at the American Economic Liberties Project, said Thursday in a statement. “Acquiring One Medical will entrench Amazon’s growing presence in the healthcare industry.”
The corporate behemoth bought the online pharmacy PillPack in 2018 for $750 million, launched Amazon Pharmacy in 2020, and expanded its Amazon Care telehealth program nationwide earlier this year, among other recent deals.
“Amazon just set its healthcare efforts to warp speed,” Axios health tech reporter Erin Brodwin tweeted Thursday. “Where among Amazon’s sprawling health efforts does One Medical fit, exactly, and how will it weave the buy into its existing primary care bets?”
One Medical “already has its tentacles in Medicare” through its 2021 acquisition of Iora Health, Brodwin noted, “and now Amazon’s got a clear foothold there.”
The Leverreported Friday that Amazon “could use its new platform to advance the cause of Medicare privatization at a much more aggressive pace. The consequences wouldn’t just mean more taxpayer dollars funneled to the mega-corporation, but also Medicare recipients facing a healthcare system with ever more resources being allocated to profit instead of care.”
As the outlet noted:
President Joe Biden’s Center for Medicare and Medicaid Services (CMS) has expanded a Medicare privatization scheme launched under former President Donald Trump. That program, which is currently referred to as ACO REACH, involuntarily assigns Medicare patients to private health plans operated by for-profit companies, like One Medical subsidiary Iora Health.
Medicare provides set payments to provide care for these patients, much like insurance. This arrangement incentivizes Iora and other privatization entities to limit the amount of care that seniors receive.
Continued expansion of Medicare privatization seems integral to One Medical’s business model.
The company’s most recent quarterly report shows that more than half of its revenue comes from Medicare. This includes Medicare Advantage plans operated by private health insurers, traditional Medicare fee-for-service payments, and the ACO REACH program.
Amazon’s purchase of One Medical “will be a blow to the fight for universal healthcare,” journalist Aaron T. Rose tweeted Thursday. “Imagine all the money Amazon will pour into lobbying to stop Medicare for All now that they have a dog in the fight.”
In addition, Brown warned, the deal—which would mark Amazon’s third-biggest acquisition after Whole Foods ($13.7 billion) and MGM Studios ($8.5 billion)—”will also pose serious risks to patients whose sensitive data will be captured by a firm whose own Chief Information Security Office once described access to customer data as ‘a free for all.'”
“Amazon has no business being a major player in the healthcare space,” she added, “and regulators should block this $4 billion deal to ensure it does not become one.”
Sen. Amy Klobuchar (D-Minn.), chair of the Senate Judiciary antitrust subcommittee, has asked the Federal Trade Commission (FTC) to investigate Amazon’s move to buy One Medical.
“This proposed transaction raises questions about potential anticompetitive effects related to the pharmacy services business Amazon already owns and about preferencing vendors who offer other services through Amazon,” Klobuchar wrote Thursday in a letter to the agency.
“I also ask that the FTC consider the role of data, including as a potential barrier to entry, given that this proposed deal could result in the accumulation of highly sensitive personal health data in the hands of an already data-intensive company,” she added.
This story has been updated with information about Sen. Amy Klobuchar’s letter to the FTC.
The US is willing to sacrifice countless lives to weaken Russia
The US is doing everything possible to extend the suffering of the Ukrainian people by creating conditions that appear to mandate an expansion of Russia’s military effort, and the subsequent destruction of the Ukrainian nation.
US President Joe Biden has approved the transfer of at least four M142 High Mobility Artillery Rocket Systems (HIMARS) to Ukraine. In a “guest essay” published in The New York Times, Biden declared that “[The United States has] moved quickly to send Ukraine a significant amount of weaponry and ammunition so it can fight on the battlefield and be in the strongest possible position at the negotiating table. That’s why I’ve decided that we will provide the Ukrainians with more advanced rocket systems and munitions that will enable them to more precisely strike key targets on the battlefield in Ukraine.”
Prior to the decision regarding HIMARS being announced, the president ppeared to be shying away from sending advanced artillery rockets to Ukraine. “We’re not going to send to Ukraine rocket systems that strike into Russia,”he had announced, on May 30, in response to a reporter’s question. Biden, however, appears to have been speaking about the ATACMS missile. He clarified his position the next day, in his essay. “We are not encouraging or enabling Ukraine to strike beyond its borders.”
The fact is, the HIMARS system, if deployed close to the Russian frontier, would give Ukraine the ability to strike nearby Russian cities, such as the strategic logistics hub in Belgorod. Biden’s apparent reversal was in large part due to guarantees from Kiev. “The Ukrainians have given us assurances that they will not use these systems against targets on Russian territory,” Secretary of State Antony Blinken declared a day after Biden’s essay was published. “There is a strong trust bond between Ukraine and the United States.”
The Russian Presidential spokesperson, Dmitry Peskov, decried the HIMARS decision as “deliberately and diligently pouring fuel on the fire,” while scoffing at the notion of Ukrainian assurances regarding the weapons systems’ future use. “In order to trust [someone], you need to have experience with situations when such promises were kept,” Peskov said. “Regretfully, there is no such experience whatsoever.”
According to President Biden, the purpose behind his decision to arm Ukraine with billions of dollars’ worth of advanced weaponry was motivated by pure intent. “America’s goal is straightforward: We want to see a democratic, independent, sovereign and prosperous Ukraine with the means to deter and defend itself against further aggression.” Recognizing the difficult situation Ukraine has found itself in militarily, he seems to understand the pressures being placed upon Kiev to negotiate an end to the fighting. “I will not,” Biden declared, “pressure the Ukrainian government…to make any territorial concessions. It would be wrong and contrary to well-settled principles to do so.”
Biden was making specific reference to the fact that any potential agreement with Russia to stop the fighting would, at a minimum, need to recognize Crimea as Russian and the Donbass republics as independent, as well as understand the probability that Kherson and other Russian-majority territories currently under Moscow’s control would probably undertake referenda regarding whether they would remain a part of Ukraine going forward.
Biden’s posture flies in the face of historical and practical reality. Russia will never give up Crimea, nor will it pressure the newly independent republics of Lugansk and Donetsk to rescind their hard-won liberation. Any other questions of territorial status are directly related to battlefield realities, and everything indicates that not only will Ukraine be unable to reverse Russia’s territorial gains but will more than likely lose additional swaths of territory, in the weeks to come. as the fighting continues.
Biden, by providing advanced weapons to Ukraine, is seeking to accomplish the impossible–a negotiated Ukrainian victory. This is reflected in his fanciful depiction of the current state of negotiations between Ukraine and Russia. “Ukraine’s talks with Russia are not stalled because Ukraine has turned its back on diplomacy,” Biden states. “They are stalled because Russia continues to wage a war to take control of as much of Ukraine as it can. The United States will continue to work to strengthen Ukraine and support its efforts to achieve a negotiated end to the conflict.”
Biden’s words, like the American policy they ostensibly describe, are inherently contradictory and reek of hypocrisy. After declaring that “We do not want to prolong the war just to inflict pain on Russia,” Biden goes on to articulate a case for just that. “It is in our vital national interests to ensure a peaceful and stable Europe and to make it clear that might does not make right. If Russia does not pay a heavy price for its actions, it will send a message to other would-be aggressors that they too can seize territory and subjugate other countries.”
The ongoing Russian-Ukrainian conflict is one that should never have been fought and once started, should have been brought to a quick conclusion. The blame for both the initiation of the conflict, and the fact that is it still ongoing today, does not lie, as Biden suggests, with Russia.
A quick history lesson: The special military operation is a direct result of America’s ongoing efforts to use NATO expansion, including the desired incorporation of Ukraine, as a means of weakening Russia while undermining the viability of the leadership of Russian President Vladimir Putin so that he could be replaced with a modern-day clone of Boris Yeltsin—a Russian ‘leader’ in name only, who would once again cast the country prostrate at the feet of a domineering West.
The decade of the 1990s was good for those in the West seeking to punish Russians for the perceived Cold War sins of the Soviet Union. But it was a horrible time for the Russian people. Neither President Putin nor wider society appear to be willing to allow the US and NATO to reverse the hands of time and repeat that era of darkness. Any student of modern Russian history would know this. Unfortunately, Western leaders are informed not by Russian historians but by Russophobe propagandists, and the result is a conflict in Ukraine.
The special military operation, however, was not triggered by NATO’s expansion, but rather by the policies of Ukraine, promoted and facilitated by NATO, which subjected the ethnic-Russian population of Donbass to the eight-year horror of genocidal, ethnic-driven hatred inflicted on them at the hands of the most vile, odious ideology imaginable – the neo-Nazi extremism of the Ukrainian political far right, embodied in the form of the Azov Regiment and other organizations of its ilk.
Despite the existence of a negotiated framework for peace – the 2015 Minsk Accords – brokered as part of the Normandy Format mechanism that included France, Germany, and Ukraine, with Russia observing, the US and its NATO allies (including France and Germany) not only failed to pressure successive Ukrainian presidential administrations to fulfil their obligations under the accords, but actively conspired against any process that would have led to the peaceful conclusion of the Donbass conflict in a manner which not only ended the killing, but also ensured that the Donbass region would remain an integral part of the Ukrainian nation.
The result was an eight-year conflict which killed over 14,000 people, most of them ethnic Russians.
Russia’s military operation was initiated for the purpose of bringing the conflict in Donbass, and the suffering of the local population, Ukrainian and Russian alike, to an end. That it has taken this long is the direct result of miscalculations on the part of the Russian military in the initial phases of the operation, the unexpected resilience and determination of the Ukrainian armed forces, and the fact that the Ukrainians had eight years to construct some of the most complex defensive positions in modern history along the line of conflict in the Donbass regions. In the end, however, Russia’s determination to see the mission through to its completion, combined with the professionalism and competence of its military forces, are producing the very victory that is unfolding on the ground in eastern Ukraine today, and which Biden seeks to reverse through the provision of advanced weapons systems such as HIMARS.
An important reality which cannot be overlooked in the ongoing military struggle is that the Ukrainian military has been functioning as a de facto extension of NATO for some time now. Since 2015 the US and its NATO allies have been training Ukrainian officers and soldiers to NATO standards in terms of organization, tactics, communications, and leadership. While most of the Ukraine military’s pre-conflict inventory was composed of Soviet-era equipment, much of this had been upgraded so that it met or exceeded the capabilities of most NATO members. In short, if Ukraine had been a formal member of NATO, it would have possessed the third largest military in the organization, after the United States and Turkey, with greater capabilities and competency than most of its other would-be NATO partners.
In the years leading up to Russia’s special military operation, Ukraine was supplied with hundreds of millions of dollars of modern military equipment, including Javelin anti-tank weapons. These weapons, and the Ukrainian military, failed to defeat the Russians. Indeed, by the end of Phase One of Russia’s operation, announced on March 25, Russia had inflicted significant harm on the Ukrainian military, making a Russian victory in Phase Two–the liberation of the Donbass–all but inevitable.
The provision of tens of billions of dollars of military aid by the US, NATO, and the European Union has not been able to reverse this tide. What these weapons, when combined with the simultaneous provision of real-time intelligence about Russian force dispositions and an untouchable strategic depth in the form of military bases in Germany, Poland, and other NATO countries from where Ukraine can receive training and equipment without fear or Russian attack, have been able to allow is the ability for Ukraine to reconstitute many of the military formations that Russia had destroyed or degraded during Phase One.
The “HIMARS Effect” will not have any meaningful impact on the battlefield in Ukraine–Russia’s military superiority is assured across the board, regardless of the numbers and quality of the weapons the US and its allies provide Ukraine. However, the goal of the US in Ukraine, according to President Biden, is to inflict a heavy price on Russia for its actions. HIMARS, when employed, will inevitably kill and wound Russian soldiers, and damage and destroy Russian military equipment. The same is true for all the lethal weapons Ukraine has been provided by the West.
Russia is, in fact, paying a heavy price in Ukraine, not because of any aggressive act of territorial acquisition carried out by the Russian military, but rather as a direct result of the policies undertaken by both NATO and Ukraine to threaten the legitimate national security interests of the Russian nation, and the lives of the ethnic Russian population of the Donbass and other eastern Ukrainian territories. All HIMARS contributes to this process is an expanded death count without a change in the outcome. In this, the HIMARS Effect perfectly encapsulates Biden’s Ukraine policy as a whole, where he is willing to sacrifice the lives and viability of the Ukrainian people and nation for the purpose of inflicting harm on Russia with no hope of altering the outcome of events on the ground.
It is a policy of death, pure and simple, and as such epitomizes the role played by America in the world today.
Scott Ritter is a former US Marine Corps intelligence officer and author of ‘SCORPION KING: America’s Suicidal Embrace of Nuclear Weapons from FDR to Trump.’ He served in the Soviet Union as an inspector implementing the INF Treaty, in General Schwarzkopf’s staff during the Gulf War, and from 1991-1998 as a UN weapons inspector.
The Biden administration recently expanded on Donald Trump’s efforts to privatize Medicare. Now patients are being assigned to new private plans without their consent, and private equity firms and major health care companies are the ones profiting.
The Joe Biden administration’s recent entrenchment and expansion of the Donald Trump administration’s efforts to privatize Medicare is helping a shadowy set of big-business beneficiaries: private equity firms and major health care companies, including one that previously employed the government official overseeing the privatization plan, a new analysis from us shows.
In April last year, the Biden administration contracted with fifty-three third-party companies to mandate privatized health care plans through Medicare. The resulting health care options are effectively Medicare Advantage plans, or private coverage offered through the national health insurance program for seniors and people with disabilities — but with one wrinkle: Patients are being assigned to these new plans without their consent.
The fifty-three participating companies — called “direct contracting entities,” or DCEs — are allowed to offer benefits beyond traditional Medicare, like gym membership coverage. But as for-profit businesses that receive a set payment from Medicare no matter how much care they approve, these DCEs are incentivized to limit the care that patients receive, especially when they are very sick. The first DCEs were launched by President Donald Trump in 2019, and so far, at least 350,000 seniors have already been moved onto these privatized Medicare plans.
Now, a new analysis by us of the fifty-three DCEs found additional cause for concern: fifteen of these entities, or slightly more than a quarter, are backed by private equity firms, which are known for extracting profits at the expense of workers, the environment, and even their own pension fundinvestors. The firms include big-name firms like the Carlyle Group, General Atlantic, Clayton, Dubilier & Rice, Benchmark Capital, and Warburg Pincus. What’s more, another fifteen DCEs are linked to big health care companies — including one with a direct connection to the Biden appointee in charge of the new privatized Medicare scheme.
Wall Street’s encroachment into Medicare is the latest example of private equity’s aggressive expansion into health care, which has ranged from hospitals to ER doctorgroups. In 2021, private equity managers deployed $172 billion in capital in the health care sector — nearly four times the total budget of the National Institutes of Health.
Biden himself has lambasted the for-profit industry’s takeover of eldercare services, noting during his State of the Union address in March: “As Wall Street firms take over more nursing homes, quality in those homes has gone down and costs have gone up. That ends on my watch.”
Biden apparently doesn’t have the same concerns about Wall Street’s growing role in Medicare — a development that could lead to higher medical bills for patients. The financial industry has already demonstrated its willingness to take a forceful approach to generating health care profits; private equity waged an aggressive campaign to derail legislation designed to stop so-called “surprise” medical bills, which formed a significant part of their hospital staffing firms’ bottom line.
Now, as private equity muscles into privatized Medicare, industry lobbyists are likely to push for more generous payment structures that benefit for-profit firms at the expense of Medicare patients. The Medicare Payment Advisory Commission, an independent body that advises Congress on Medicare, hinted at this scenario while discussing private equity’s role in the Medicare Advantage space at an April 2021 hearing.
“The end result might or might not be better for consumers, but I think that it does have an impact on Medicare payment policy,” said commissioner Pat Wang.
Experts fear that the Medicare space could be especially vulnerable to Wall Street’s predatory approach.
“We have lots of evidence from many other situations in which private equity puts profits before patients,” said Eileen Appelbaum, codirector of the Center for Economic and Policy Research and coauthor of Private Equity at Work: When Wall Street Manages Main Street. “They are looking for a place where it’s easy to make money — and it’s easy to make money when it’s the taxpayer footing the bill.”
Big Players, Big Profits, and a Big Conflict
While the DCE program was launched under President Trump, Biden expanded the effort in February under a new name: the Accountable Care Organization Realizing Equity, Access, and Community Health program, or “ACO REACH.” Now, hospital-backed for-profit health benefit programs are also allowed to automatically enroll Medicare patients into their health care plans.
Like providers of Medicare Advantage plans, these new firms receive a set payment from Medicare for their offerings, supposedly to incentivize more holistic and better care. In exchange, these firms acquire Medicare patients in their plans — often without the patients realizing what is happening.
In March, we reported on how one Medicare beneficiary who was quietly assigned to a DCE initially misinterpreted a message she received about the shift as a health-related communication from her doctor — despite being an experienced health policy expert.
Along with the fifteen private equity-backed companies, the list of approved DCEs the Biden administration released in April 2021 includes fifteen operations owned by health care giants, such as insurers Humana, UnitedHealth, and Anthem, the pharmacy chain Walgreens, and the dialysis provider DaVita.
Experts say these connections raise serious questions about conflicts of interest. For example, the DCE program is being led by a little-known federal entity, the Centers for Medicare & Medicaid Services’ (CMS) Innovation Center, headed by Liz Fowler — the former vice president of public policy for the insurer WellPoint, now known as Anthem.
In response to our request for comment, a CMS spokesperson said that Fowler was not involved in the approval process for DCEs. They additionally asserted that many of the entities identified by us are not private equity–backed because they are public companies.
But several of these public companies have received substantial investments from private equity firms, also known as “private investment in public equity.” For example, while 1LifeHealthcare — a primary care provider that owns one of the DCEs, One Medical’s Iora Health — is publicly traded, the major private equity firm Carlyle Group owns more than 7 percent of its shares.
Critics say Fowler has a history of crafting policy to help her private sector contacts.
“Honestly this just seems to add to the pattern we’ve observed with Liz Fowler,” said Fatou Ndiaye, a research assistant with the Revolving Door Project, which monitors the revolving door between the public and private sector.
Ndiaye pointed out that before she lobbied for WellPoint, Fowler worked for Senator Max Baucus (D-MT), where she helped draft Medicare Part D, a program critics said was a huge giveaway to the pharmaceutical industry because it created massive new drug benefits without controlling prices.
After working for Wellpoint from 2006 to 2008, Fowler rejoined Baucus’s staff, where she helped draft a version of the Affordable Care Act (ACA) that excluded the public health insurance option promised by Democrats, resulting in huge profits and no public sector competition for private insurers.
“A year after [ACA’s] passage, Wellpoint’s profits increased by 91 percent to $2.3 billion,” said Ndiaye.
Private Equity Muscles In
The fact that private equity now backs more than a quarter of all companies in the DCE space stands in stark contrast to the fact that private equity owns just 2 percent of all for-profit Medicare Advantage programs.
While Medicare Advantage options have been criticized by health advocates because of their extremely high costs, the fact that private equity is focusing its attention on this new kind of nonvoluntary privatized Medicare scheme suggests that Fowler and the Biden administration could be setting the stage for substantially larger private equity involvement in the national health insurance program.
Examples abound of problems arising when private equity takes over health care operations. Just last month, Buzzfeed News reported that BrightSpring, a group home operator acquired by private equity megafirm KKR in 2019, has since been plagued by serious problems at its group homes for people with disabilities, leading to residents being seriously injured and in some cases dying.
The Carlyle Group, which has an ownership stake in OneMedical, the parent company of Iora Health, has a particularly disturbing history in health care. After Carlyle acquired HCR Manorcare, a nursing home chain, the company was plagued by serious lapses in standards of care until it went bankrupt eleven years later.
Other private equity–backed operations approved for the new DCE program have major connections to the Democratic Party establishment. The private equity firm Warburg Pincus, which backs a DCE called Excelera, was cofounded by the father of current secretary of state Antony Blinken and boasts former Barack Obama treasury secretary Tim Geithner as its president.
Laura Katz Olson, a professor at Lehigh University and author of the recently publishedEthically Challenged: Private Equity Storms US Health Care, said that private equity’s role in Medicare privatization raises significant concerns.
“If you understand the private equity playbook, the dangers are fairly obvious,” said Katz Olson. “They’re borrowing money so they have to pay off debt. They’re taking money into their pockets through fees. You would have to be a magician to keep up quality of care doing all of these things.”
She added, “Private equity is bad for health care, period, so I can’t imagine that it would be good for Medicare Advantage. I’m actually in a state of surprise that they’re even thinking about it.”