Medicare Expansion Closer to Congressional Approval

WASHINGTON - As Congress took the first steps toward approving a $400 billion prescription drug plan for senior citizens Thursday, it appeared that a historic expansion of the Medicare program suddenly had surprising momentum.

Legislation to help seniors with expensive drug costs would be a milestone for a Congress that has been in constant disagreement on everything from Head Start to tax cuts. In the Senate, the prescription drug plan unveiled just last week has quickly drawn both Democratic and Republican support.

"I think everyone has been surprised," said Senate Majority Leader Bill Frist, R-Tenn., who chalked up the cooperation to pressure from voters eager for assistance.

To be sure, there is still plenty of grumbling from both conservatives and liberals.

Many Democrats say the plan is stingy, complicated and requires recipients to shell out too much of their own money. They also have complained that the plan would not begin until 2006 and could change from year to year.

"I hope seniors will not have to hire accountants and attorneys to tell them what their options are," said Sen. Jeff Bingaman, D-N.M.

Some Republicans, on the other hand, complain that the plan is too expensive and would not require seniors to contribute enough of their own money. People who are elderly and poor or disabled would pay about 10 percent of their prescription drug costs.

"I happen to believe we're too generous," said Sen. Don Nickles, R-Okla.

But after years of disagreement and inaction, Congress, with President Bush offering his support, appears poised as never before to provide money to help seniors pay for prescription drugs.

The landmark legislation might not have reached this point if Bush and congressional Republicans had continued to insist that seniors who wanted a prescription drug benefit must first enter a private insurance plan, giving up the traditional fee-for-service approach and leaving the Medicare program.

House Speaker Dennis Hastert, R-Ill., said in February that he told Bush that plan would not fly.

"I don't think you can do it humanely," Hastert said he told Bush. "I don't think you can do it politically. I don't think it's practical."

Later, administration officials said they would give seniors who stuck with their doctors in the traditional Medicare plan a discount card for purchasing prescriptions. The officials said they would provide a heftier benefit for those who joined a private health plan.

That approach, however, was just as controversial. Sen. Olympia Snowe, R-Maine, said she could not support anything that did not provide a comprehensive prescription drug benefit to all senior citizens in Medicare.

With Bush eager to score domestic victories in advance of his re-election campaign, and needing support of moderates like Snowe, the administration backed down for a second time.

Snowe's views were incorporated into a bipartisan plan crafted by Senate Finance Chairman Charles Grassley, R-Iowa, and the ranking Democrat, Sen. Max Baucus of Montana.

"Both parties have promised for years to add prescription drugs to Medicare," Grassley said Thursday. "At least in Iowa, when you make a promise, you deliver. Today we're here to deliver."

The committee approved the bipartisan plan late Thursday, 16-5. The full Senate is expected to debate the measure starting Monday.

House Republicans unveiled their version of the bill Thursday afternoon, and plan to offer amendments in committee next week.

Meanwhile, Bush pressed Congress to move quickly.

"The Congress must understand we've got a problem with Medicare. They should not politicize the issue," the president told a friendly audience in Connecticut. "They ought to focus on what's best for our fellow Americans and get a package done. And the House needs to get it done, and the Senate needs to get it done prior to the Fourth of July break."

Bush also announced the administration is rewriting federal regulations so that cheaper generic drugs can be brought to the market more quickly, providing relief for senior citizens and others dependent on expensive, specialized medications. Bush announced the initiative last year; Thursday marked the final formal action on the rule changes.

Bush's newfound urgency over the issue of Medicare reform - he mentioned it in a radio address Saturday and in successive speeches this week in Chicago and Connecticut - highlights the White House strategy to score quick and decisive victories on issues expected to dominate the 2004 presidential campaign.

The Medicare reforms and concerns Bush has expressed over the availability of prescription drugs are intended to shore up his support among senior voters, an active voting bloc critical to winning Florida and other essential states.

But it also is expected to boost his standing among moderate voters in general who may view the White House, with its enthusiasm for tax cuts, as coldhearted. Bush has gone to great lengths to define himself as a "compassionate conservative."

Health care experts say the House and Senate bills are remarkably similar in their approach, which could expedite the legislative process.

"There does appear to be significant agreement for the first time in many, many years on the basic structure," said Tricia Neuman, vice president of the Kaiser Family Foundation, a health policy think tank.

Under both bills, seniors would receive the same subsidy from the federal government to pay for prescription drugs whether they stay in a traditional fee-for-service program or move into an HMO or preferred provider health plan.

Both the House and the Senate measures would require seniors to pay an average of $35 a month for drug coverage. The Senate would include a $275 annual deductible, while the House would set a $250 yearly deductible.

The Senate bill would cover half of seniors' drug bills up to $4,500 a year. The subsidy would stop at that point until prescription costs reach $5,800 a year. Then seniors would pay 10 percent of any further drug bills with the remainder covered by Medicare.

The House, on the other hand, would cover 80 percent of the first $2,000 in drug costs. Seniors would pay 100 percent of their bills after that until drug costs reach $5,700. At that point, Medicare would cover 100 percent of drug costs except for seniors who earn more than $60,000 a year, or $120,000 per couple. Seniors earning that much money would receive reduced benefits based on a sliding scale.

House Ways and Means Committee Chairman Bill Thomas, R-Calif., said, "A couple making $120,000 in retirement should at least be expected to pay a couple of dollars more out of their pocket."

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(Bob Kemper of the Tribune's Washington Bureau contributed to this report.)

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(c) 2003, Chicago Tribune. Distributed by Knight Ridder/Tribune News Service.