Battle forming on tentative Medicare deal

Monday, November 17, 2003

WASHINGTON -- Political battle lines began to form Sunday on a tentative agreement to give older Americans a new prescription drug benefit and overhaul the Medicare program. President Bush gave the legislation his enthusiastic backing.

"I will be actively pushing the bill" in the coming days to ensure passage, Bush said, leading the Republican effort to overcome anticipated resistance from Democrats and objections from some Republicans.

Sen. Edward M. Kennedy led the charge for Democrats, calling the bill a "partisan attack on Medicare" and predicting it would not pass the Senate.

A day after Republican congressional leaders announced the breakthrough on the legislation, they gathered in the Capitol again Sunday to begin selling the agreement to the public and fellow lawmakers. Republicans hope to pass the bill by week's end.

Many details remained unknown Sunday as congressional staff worked on the cost of the bill -- which cannot exceed $400 billion over 10 years -- and its final composition. "The devil is in the details," said Sen. Olympia Snowe, R-Maine, who has objected to provisions emerging from the negotiations.

At its core, the legislation would give millions of seniors prescription drug coverage for the first time for a premium of roughly $35 a month. At the same time, the bill would create a large new role for private insurers in health care for 40 million older and disabled Americans.

Final sticking points

Senate Majority Leader Bill Frist, R-Tenn., said he thinks most lawmakers will be persuaded to support the bill because of the drug benefit and the ability of seniors to choose their health plans, including remaining in traditional Medicare.

"If you're satisfied with what you have today, you don't have to change," Frist said Sunday at a Capitol news conference to give an outline of the legislation.

Frist said AARP, the 35-million member seniors' group, specifically endorsed compromises on final sticking points in the bill, including efforts to encourage employers to maintain drug coverage for retirees, direct competition between traditional Medicare and private plans, and providing more money to low-income seniors.

AARP chief executive William Novelli said the group would make no decision on an endorsement until it reviews final details of the legislation.

Other interest groups, including the American Medical Association and the trade organization for the managed care industry, announced their support for the legislation.

Sen. Max Baucus, D-Mont., one of two Democrats who took part in months of negotiations, said the bill "is not perfect from anyone's perspective, but it's good legislation."

He said the bill would attract significant Democratic support in the Senate, even if Kennedy and other leading Senate Democrats oppose it.

"Many will reach the decision that this is better to pass than not to pass," Baucus said.

Kennedy and Senate Democratic leader Tom Daschle of South Dakota raised warning flags Sunday that the bill would do more harm than good.

Daschle, on "Fox News Sunday," said, "We may actually be coercing up to 10 million people into an HMO system that could mean dramatically higher costs ... in premiums for Medicare."

'Guinea pigs'

A critique of the bill prepared by Kennedy's staff called the competition program "a vast social experiment using senior citizens as guinea pigs." The document also took issue with negotiators claims that they had found a way to reduce by half the number of retirees who would lose employer-based coverage once the new drug benefit kicked in.

Competition would begin in 2010 in six metropolitan areas and last six years. Extending it beyond that would require congressional approval.

Sen. John Breaux, D-La., the other Democratic negotiator, said the bill would cap annual premium increases for seniors who remain in traditional Medicare at 5 percent a year, responding to criticisms that premiums would soar for those who did not move to private plans.

And Baucus said he disagreed with those who say the temporary program would harm traditional Medicare.

The legislation includes several provisions designed to meet conservatives' demands. These include a new health-related tax break for individuals with a high-deductible health insurance policy; a requirement for higher wage-earners to pay more for the out-of-hospital coverage they receive under Medicare Part B; and a requirement for Congress to review Medicare's costs if they rose to unexpected levels.

The agreement also contains at least $25 billion for rural doctors and hospitals.

It would essentially leave unchanged the ban on importing prescription drugs from Canada, although it would authorize a study to determine what it would take to guarantee the safety of imported drugs.

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