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Medicare bills head to conference

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WASHINGTON, Jun 27, 2003 (United Press International via COMTEX) -- Senate and House conferees will have to settle the controversial issue of how far to push Medicare toward the private sector as they work out differences in bills to provide a prescription drug benefit that passed both chambers early Friday.

Throughout the negotiations, Democrats and Republicans stuck to their party lines -- the Democrats pushing to keep Medicare a government-run entitlement program and the Republicans seeking to privatize it, hoping it would provide enhanced benefits and lower costs through market competition.

The Senate, however, had little trouble garnering support for its bipartisan bill that creates a limited prescription drug benefit in Medicare and expands managed care options by allowing preferred provider organizations to bid for Medicare business. Senators considered scores of amendments and rejected almost all in a debate Thursday that was spirited but mostly cordial.

The House debate was far more raucous, and as Thursday night wore on it began to look more like a reality TV show as an argument over how much the prescription drug benefit in the bill would help seniors disintegrated into a rant over who loved their mothers more, Republicans or Democrats.

There is a good chance the final bill will be closer to what the Senate has passed and it has support from the Bush administration, which still has requested some changes.

The 76-21 vote came after many Democrats supported the bill, not because it was a great piece of legislation to help all Medicare beneficiaries, but simply to work a prescription drug benefit into the national senior health care program.

"It's not the kind of bill I would enthusiastically endorse," Senate Minority Leader Tom Daschle, D-S.D., said. "We're going to make this better. It may take months or years but we will work to make this a better bill."

Daschle also warned if the final bill comes out of the House-Senate conference committee "in very different form" than the Senate version "this legislation may still be in trouble."

Sen. Bill Frist, R-Tenn., told reporters Friday the conference committee will be dealing with a complex piece of legislation.

"And let us not overlook the fact that there are still a number of hurdles to overcome," he said.

House Republicans steamrollered their bill through using the Rules Committee and leadership pressure. Such a maneuver resulted in confining members to debate only the bill without amendments.

Some Democrats were enraged Thursday as Rep. Jim McDermott, D-Wash., said, "The rubber stamp Congress is ready to act tonight."

The narrow House vote, 216-215, came in the early hours of Friday after GOP leaders made some last-minute deals with reluctant Republicans to gain their support.

The major hurdle in the more conservative House bill is it pushes harder for privatization -- tying Medicare to the private insurance industry -- than its Senate counterpart. A critical conference committee sticking point will be the House provision that calls for traditional Medicare to be funded in 2010 in part based on prices bid by insurers for private plans, a move Democrats claimed was aimed at destroying the fee-for-service program.

Another bone of contention is the Senate plan contains -- and the House plan does not -- a backup provision to provide government-guaranteed prescription drug coverage for seniors in traditional Medicare if private plans do not come forward to offer drug-only plans.

Rep. Jerry Kleczka, D-Wis., said of the House bill, "This is the beginning of the end of the Medicare program."

Both House and Senate plans contain large gaps in prescription drug coverage, within which Medicare beneficiaries would be required to pay all their drug costs, even while they continue to pay monthly premiums to participate in the program. Amendments to close or reduce the gaps were turned away during debate.

Thomas Brock, senior counsel in the health care department at the Washington, D.C., law firm of Proskauer & Rose, said he expects the conference committee will compromise on the prescription drug plan deductibles -- $275 in the Senate bill and $250 in the House.

"Those are simply dictated by budget limitations," he told United Press International.

Brock said the conference members could create a final bill that "makes everybody think they are getting something" while extending benefits to the most financially needy and covering the catastrophic end of the spectrum for seriously ill seniors who have high drug costs.

He said the coverage gap might be reduced in the final legislation but he does not expect it to be eliminated.

Both bills contain provisions allowing seniors easier access to generic drugs and the reimportation of drugs from Canada, which has cheaper prices.

The conference committee also must craft a bill that entices PPOs to participate in Medicare and insurers to offer drug-only plans for seniors remaining in the traditional Medicare program. The Senate bill contains specific language on how much financial risk the government will assume should plans encounter higher-than expected costs.

"It's absolutely critical that we do make the private sector element with private plan participation work," Frist said of the conference committee. "That will be the challenge before us. A number (of conferees) have come forward and said that they are very interested in doing so. And I think that's something we'll study over the next month."

The House bill also contains provisions for Medical Savings Accounts, which allow seniors to save money for health care expenditures in a tax-free account. The Senate bill does not have that option and although Frist, who supports the concept, said it would be discussed in conference, he could not predict if it would be included in the final bill.

The goal had been to send a final bill, which still must be approved by both the House and Senate, to President Bush for his signature by the summer congressional recess at the end of July. Both Frist and Grassley said they would not impose such a deadline, however.

"If it takes time to do it right, we'll take time," Grassley said.

Copyright 2003 by United Press International.

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