Tuesday, November 25, 2003
WASHINGTON (AP) -- The nation's 40 million older and disabled Americans would see the biggest changes to Medicare since its creation in 1965, including a new prescription-drug benefit, under legislation awaiting final congressional approval.
Drug coverage would not begin until 2006, although seniors could buy a drug discount card beginning next year.
The $395 billion legislation -- a top priority for President Bush -- faces one last, low hurdle: passage by the Senate, which was expected today. Both sides acknowledged the final vote was not in doubt after lawmakers cleared away the last efforts Monday by Democratic opponents to stop the legislation.
House passage
The House had passed the bill near dawn Saturday on a 220-215 vote. Final approval in the Senate would give Bush and the congressional Republican majorities a significant legislative and political triumph on an issue that Democrats long have exploited in political campaigns.
Senate Majority Leader Bill Frist, R-Tenn., called it a "historic" and "momentous" day as lawmakers broke years of deadlock over revamping Medicare.
But Sen. Edward Kennedy, one of the legislation's staunchest foes, said the bill ultimately would cause "the unraveling of the Medicare system." He predicted Republicans would go on to attack Social Security after next year's election.
Bush was eager to sign the bill into law.
"Modernizing Medicare will make the system better and enable us to say to seniors we kept our promise," Bush said after visiting Army troops Monday at Fort Carson, Colo.
A compromise
At its heart, the Medicare legislation was designed as a compromise, with the new drug coverage for all Medicare beneficiaries long sought by Democrats combined with a Republican-backed plan to give private insurance companies a vast new role in health care for the program's beneficiaries.
Under the legislation, seniors would be eligible beginning next year to buy a Medicare-backed discount drug card at a cost estimated at $30 a year. The administration estimated the card would mean savings of between 15 percent and 25 percent off retail prices; critics argued those numbers were wildly inflated.
Beginning in 2006, the legislation would allow seniors to buy coverage for their prescription drugs. GOP officials estimated the drug insurance premium would be $35 a month, with a $250 deductible. The coverage would pay 75 percent of costs after that until a recipient's drug costs reached $2,250. After that, there would be no drug coverage until a recipient's out-of-pocket expenses reached $3,600, or roughly $5,100 in overall prescription expenses. Above that level, insurance would pick up roughly 95 percent of costs.
The measure included subsidies for low-income seniors.
Additional provisions
The scope of the bill went far beyond prescription drugs, though, including an additional $25 billion for rural hospitals and health-care providers, a requirement for higher-income seniors to pay more for Medicare Part B coverage and billions of dollars to discourage corporations from eliminating coverage for their retirees once the new government program began.
The bill would satisfy other goals of conservatives, including creation of tax-preferred health savings accounts, open to individuals who buy high-deductible health insurance policies.
Most contentious of all, the legislation would create a limited program of direct competition between traditional Medicare and private plans beginning in 2010. Conservatives argued that would help bring down the cost of Medicare over the long run; critics said it would privatize the program and lead to "cherry-picking" of relatively healthy seniors by insurance companies and higher premiums for those seniors who remained under the government-designed benefit.
Touting opportunity
Over and over, supporters of the bill stressed that after years of gridlock, the opportunity to act was at hand. "If we don't do this at this time, it may be years" before another opportunity comes along, said Sen. Charles Grassley, R-Iowa, an architect of the bill.
Critics were unmoved. Senate Democratic Leader Tom Daschle called the bill a "bailout for the HMOs and insurance companies."
The bill's path to passage was cleared in the Senate on a pair of procedural votes, including a cliffhanger that was decided only when Sen. Trent Lott of Mississippi, the former Senate Republican leader, sided with the current GOP leadership despite his opposition to the legislation.
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