Fight looms in final Medicare votes

Proposal to compete with private insurers is a key sticking point

November 18, 2003|By Julie Hirschfeld Davis | Julie Hirschfeld Davis,SUN NATIONAL STAFF

WASHINGTON - Both sides in the polarized debate over the future of Medicare seem to agree on one thing: The sweeping overhaul Congress is set to consider this week would shake the foundations of the health program for the elderly and disabled, bringing the most far-reaching changes to the program since its birth in 1965.

They just disagree over whether that is good or bad for America's senior citizens.

Foes of the bill, slated for final votes this week, invoke the phrase "end Medicare as we know it," saying it would take the first steps toward privatizing the program and forcing seniors to bear the load of exploding health care costs.

But its champions say the legislation would shore up Medicare as a sustainable system to serve generations to come.

There is little dispute over the bill's popular centerpiece: the addition, for the first time, of prescription drug benefits to Medicare, at a cost of $400 billion over the next decade.

Despite sharp opposition from Democratic leaders and other leading voices on health issues, the largest senior citizens group, AARP, enthusiastically endorsed the measure yesterday and said "millions of older Americans and their families will be helped by" it. The AARP told the Associated Press that it would conduct a television campaign to coincide with congressional action on the bill.

President Bush urged lawmakers in both parties to pass the measure, saying, "This vote will demonstrate whether the members of the House and the Senate will help keep our commitment to America's seniors."

Still, Republicans and Democrats are bracing for a rancorous fight over the idea - as appealing to conservatives as it is reviled by liberals - of having Medicare compete with private companies to cover seniors, with the government subsidizing both and beneficiaries choosing from among a variety of plans.

Many Republicans and a handful of Democrats who back that approach say it would bring innovation to Medicare and help limit costs in the program, which analysts say is on track to go broke if it continues expanding at current rates. Most Democrats and some Republican moderates say the proposal would kill Medicare's promise by forcing seniors to enroll in a private health care plan or pay more for the government benefit they have always had.

"It's a dangerous precedent," said Rep. Benjamin L. Cardin, a Baltimore Democrat. "My guess is that it is a significant enough issue that it will cause a lot of people, in and of itself, to oppose the bill."

Known as "premium support," the approach is a departure from traditional Medicare, which has seniors pay a set premium - $58.20 a month, and slated to rise to $66.60 next year - and the government cover doctor visits and other services.

The new approach would have private plans and Medicare bid against each other to offer the lowest-cost insurance. Based on those bids, the government would decide how much to kick in to help pay the cost of covering seniors in that area. The bill Congress is set to finalize would begin in 2010 a test of the approach in six undetermined metropolitan areas, with an eye toward expanding it nationwide if it succeeds.

"We're going to be able to demonstrate the potential to sustain Medicare over time by comparing costs of alternative benefit-delivery programs," said Rep. Bill Thomas, the California Republican who leads the Ways and Means Committee.

Thomas is among the idea's most enthusiastic advocates in Congress, along with Senate Majority Leader Bill Frist, a Tennessee Republican who is a heart surgeon, and Sen. John B. Breaux of Louisiana, one of only two Democrats included in the final Medicare talks. Frist and Breaux led a bipartisan panel in 1997 that recommended that premium support be incorporated into Medicare.

"For the first time, it will give us a comparison so that future Congresses can make informed decisions about the best type of health care delivery program we're going to have for the 21st century," Breaux said.

But Sen. Edward M. Kennedy of Massachusetts, one of the leading Democratic voices on health care issues, called the experiment "untested, untried, unworkable." It is first on Kennedy's list of reasons why he opposes the bill and why, he said over the weekend, he does not believe it will pass the Senate.

"We're playing roulette with the premium costs for our senior citizens," he said. "This is a social experiment, and we're using seniors as guinea pigs."

Seniors could see higher premiums if Medicare must compete directly with the private sector. That's because private firms that offered cheaper plans would drive down the amount the government would kick in to seniors' coverage. Traditional Medicare would still have higher costs, the theory goes, but would receive less government money for providing health services to its beneficiary.

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