Senate Finance leaders push uniform Medicare drug plan

Benefits would be equal in private, public systems

WASHINGTON - Breaking with President Bush, Senate Republicans and centrist Democrats moved yesterday toward embracing a plan that would offer all senior citizens the same prescription drug benefit, whether they stay in the traditional Medicare program or join a private health insurance plan.

Leaders of the Finance Committee are working to reach an agreement on the measure, which they expect to unveil Tuesday, and the full committee is scheduled to consider it late next week. House panels plan to follow that action with approval of their own draft, which is expected to hew closer to Bush's proposal.

Congressional leaders aim to approve Medicare prescription drug measures by July 4.

The Bush plan would add a modest prescription drug benefit to Medicare. But its broader goal is to encourage seniors to join a new "enhanced Medicare" system, in which richer coverage for prescription drugs and other health services would be offered by private "preferred provider organizations."

The Senate measure under discussion would create an enhanced Medicare option yet would make the same drug coverage available to seniors who stay in the traditional Medicare fee-for-service program.

A draft of the Senate plan circulating this week would create a prescription drug benefit in which seniors would pay a $35 monthly premium. They would have to meet a $275 deductible before Medicare would cover half of their out-of-pocket prescription drug costs, up to $3,450.

Between $3,450 and $5,300, seniors would receive no help in paying for their medicines; after that, the government would pick up 90 percent of the tab.

Those who stay in traditional Medicare would still have to meet their current deductibles: $100 for doctor visits and medical services, and $840 for hospitalization. Those who join the private health plans would pay a combined deductible of $400.

The proposal is likely to alienate Democrats, who want Medicare to administer all drug coverage, and conservative Republicans, who prefer a benefit provided entirely by the private sector.

Democrats have called for a far more costly plan that would have Medicare cover 80 percent of all drug costs. But its cost could reach $1 trillion over 10 years. Some are working to devise a benefit that could fit into the $400 billion limit that Congress has set. Most Democrats, though, insist that the government, not the private sector, should administer the coverage.

House Republicans are expected to propose having private companies provide prescription drug coverage, perhaps offering the most generous benefits to those with low incomes. Such a "means-testing" approach, which would help restrain the cost of the program, has met stiff opposition from both parties.

Some House Republicans want to provide a drug "debit card." Seniors would receive a starting balance on the card and could contribute tax-free money to it or receive contributions from former employers.