Sweeping Medicare bill passes

Prescription drug benefit, role for insurers are parts of landmark legislation

President `honored' to sign law

Program's big changes count as unlikely victory for Congress' Republicans

November 26, 2003|By Julie Hirschfeld Davis | Julie Hirschfeld Davis,SUN NATIONAL STAFF

WASHINGTON - Hours after Congress gave final approval to a sweeping Medicare measure, President Bush said yesterday that he would be "honored" to sign the bill, which for the first time would give the elderly and disabled help in paying for prescription drugs and grant private insurers a central role in the health care program.

Its enactment would represent a big political victory for Bush and the Republican Party. Senate approval of the bill yesterday morning followed House passage late last week.

"Today, we had a major victory to improve the health care system in America," Bush said during a speech at a hospital in Las Vegas. "Some said Medicare reform can never be done. For the sake of our seniors, we've got something done."

The bill constitutes the largest expansion of Medicare since its inception in 1965, an improbable achievement for a Republican president and a Congress led by conservatives, many of whom rose to power vowing to shrink the government.

The measure would set aside $400 billion over the next decade to provide the drug benefit. It contains billions more for payments to doctors and hospitals, incentives for companies that offer retiree health benefits to continue that coverage and payments to private insurers to induce them to cover seniors.

"Today is an extraordinary, it's a fateful and it's a red-letter day for seniors, and indeed for all Americans," said Senate Majority Leader Bill Frist of Tennessee, a heart surgeon who made a Medicare overhaul one of his signature issues.

The Senate vote was 54-44. Eleven Democrats and one independent joined 42 Republicans to support it. Eight Republicans, mainly fiscal conservatives who oppose large spending programs, joined 36 Democrats to oppose the measure. Maryland's two Democratic senators, Barbara A. Mikulski and Paul S. Sarbanes, voted against the bill.

The measure was approved over the fierce objections of many Democrats, including Sen. Edward M. Kennedy of Massachusetts, his party's leading voice on health care, who said the plan would "begin the unraveling of Medicare."

Democratic leaders wasted no time in launching what promises to be an intense election-year drive against the bill, including legislation that would repeal key elements of it.

"The effort to reform the Medicare reform bill begins today," said Senate Minority Leader Tom Daschle of South Dakota. "This debate is not over. It's just beginning."

Republicans hope that completion of the landmark Medicare measure will give them a politically vital foothold leading to the 2004 elections on an issue that has long been the domain of Democrats. Vigorous support for the bill from the influential AARP, which represents 35 million senior citizens, helped lend credibility to that effort.

Still, it remains to be seen how the public, and especially seniors - who vote in disproportionately large numbers - will react to the bill.

Fiscal conservatives opposed the measure as a recklessly expensive expansion of an already huge government entitlement. As Democrats complained that the bill would go too far toward privatizing Medicare and eroding the government's responsibility for covering seniors, some Republicans said it failed to go far enough toward those ends.

"This bill threatens the fiscal security of the Medicare program and compromises the continued growth of our economy by lacking the necessary cost controls to keep it from consuming our domestic budget," said Sen. John Ensign of Nevada, one of the eight Republicans who voted against the measure.

He predicted that "before the ink is dry," proponents would try to expand it further.

The centerpiece of the legislation is the creation, in 2006, of prescription drug coverage for Medicare beneficiaries. Seniors could choose to stay in traditional Medicare or obtain health benefits from private plans. Either way, private companies would offer the drug benefit.

Next spring, seniors could buy a $30 drug card, for discounts of 10 percent to 25 percent on prescription drugs, until the benefit took effect two years later.

Beginning in 2006, for a monthly premium of about $35 - about $420 a year - senior citizens and the disabled would have part of their prescription costs covered by the government. After meeting a $250 deductible, they would pay 25 percent of their drug costs, up to $2,250. They would have to pay all their prescription costs between $2,251 and $3,600. Beyond that level, the government would cover 95 percent of drug expenses.

Beneficiaries who earn $12,123 or less would receive further help. They would pay no premium and no deductible. Nor would they fall into the coverage gap between $2,251 and $3,600that other seniors would have to pay for themselves. The discount card available in 2004 would give them a $600 annual subsidy to pay for prescription drugs.

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