Bush Asks Congress To Pass Medicare Reform Legislation by July 4 Recess

President Bush yesterday urged Congress to act quickly on Medicare reform legislation and pass a bill before the July 4 recess, saying lawmakers have "an unprecedented opportunity to give America's seniors an up-to-date Medicare system that includes more choices and better benefits," the Washington Times reports. Speaking before 1,200 physicians and seniors at a meeting of the Illinois State Medical Society in Chicago, Bush said, "Medicine is changing; Medicare is not" (Curl/Fagan, Washington Times, 6/12). The Chicago Tribune reports that Bush gave "only vague guidance" on the specific features of the legislation he favors (Pearson, Chicago Tribune, 6/12). Still, the Washington Post reports that he supported the idea that private health plans should play a greater role under Medicare. "Health care moves faster than bureaucracy," Bush said (Goldstein, Washington Post, 6/12). However, Bush indicated he will not push for using prescription drug coverage as an enticement for seniors to join private health plans -- a proposal he has supported in the past. "Seniors who want to stay in the current Medicare system should have that option plus a prescription drug benefit," Bush said (Chicago Tribune, 6/12). In addition, Bush noted that it would be more cost-efficient for the program to begin covering prescription drugs that could prevent diseases than to pay for hospital stays or expensive treatments that result from those diseases (Washington Post, 6/12). "Time and again, Medicare's failure to pay for drugs means our seniors risk serious illness, disease and injuries, all of which Medicare would pay to treat after the fact," Bush said (Bumiller/Pear, New York Times, 6/12). Bush is expected to address Medicare reform again today in a scheduled appearance at a senior center in New Britain, Conn. (Chen/Gest, Los Angeles Times, 6/12).

Daschle Speaks

Senate Minority Leader Tom Daschle (D-S.D.) yesterday said he expects the Medicare reform proposal currently being debated by the Senate Finance Committee will pass the full Senate, despite his and other Democrats' objections that the bill does not "go far enough," the Chicago Tribune reports (Chicago Tribune, 6/12). The proposal would increase participation of private plans in Medicare and would offer all beneficiaries a drug benefit, regardless of whether they join a private plan. Under the plan, all Medicare beneficiaries would have access to a drug benefit beginning in 2006, for which they would pay a $275 annual deductible and a $35 monthly premium. Beneficiaries would pay half of their annual drug costs from $276 to $3,450 and all drug costs between $3,451 and $5,300. After $5,300, beneficiaries would be required to cover 10% of drug costs, with Medicare paying the remainder. Beneficiaries choosing to remain in traditional Medicare could sign up for a stand-alone drug benefit delivered through private insurers. They also could choose to enroll in a private health plan that offers a drug benefit under a new coverage option called "Medicare Advantage." Under the new coverage option, private plans would offer coverage for catastrophic health expenses and preventive care services in addition to the required Medicare benefits, giving beneficiaries an incentive to move out of traditional Medicare and into a private plan. The government itself would provide a drug benefit through a contractor in areas in which drug-only health plans decide not to participate (California Healthline, 6/11). Speaking at a press conference in Washington, D.C., held by Democrats who do not support the Finance Committee's proposal, Daschle said, "I think it will pass" (Chicago Tribune, 6/12). However, at the press conference Daschle outlined several amendments he and other Democrats plan to offer to expand the Finance Committee's proposal. According to the Washington Post, the Democrats will offer five main categories of amendments that would propose the following:

Making drug coverage "an integral part" of Medicare instead of a separate benefit;
Eliminating any coverage gap;
Avoiding "excessive local variations" in premiums, copayments or other out-of-pocket expenses;
Making it easier to bring generic drugs to market; and
Ensuring that beneficiaries in rural areas receive the same benefits and pay the same prices as those in urban and suburban areas (Washington Post, 6/12).

Sen. Debbie Stabenow (D-Mich.), who joined Daschle and Sen. John Rockefeller (D-W.Va.) at the press conference, said she plans to offer an amendment that would make it easier for seniors and others to "reimport" prescription drugs from Canada, CongressDaily reports (Rovner, CongressDaily, 6/11). Rockefeller said he plans to offer an amendment that would require the federal government cover the cost of a drug benefit for people who are dually eligible for Medicaid and Medicare (Rovner, CongressDaily/AM, 6/12). Daschle did not say if his support for the Finance Committee proposal is tied to the Democrats' proposed amendments, but he said he hoped the bill could be improved. "Many of us go into this debate with the hope we can vote for it, but we won't know that until the very end," Daschle said (Washington Post, 6/12). He added that Democrats do not plan to filibuster or otherwise obstruct the legislation on the Senate floor (New York Times, 6/12). In a separate press conference, Finance Committee member Sen. Bob Graham (D-Fla.) said he will offer an amendment that will attempt to close the gap in drug coverage between $3,450 and $5,300 under the committee's proposal by making the program temporary (CongressDaily, 6/11).

NGA Criticizes Senate Finance Plan

Representatives of the National Governors Association yesterday criticized the Senate Finance Committee's reform proposal, saying the measure would "do nothing to relieve the states of drug costs" for nearly six million people who are dually eligible for both Medicaid and Medicare, the New York Times reports (New York Times, 6/12). In a letter to Finance Committee Chair Charles Grassley (R-Iowa) and the committee's ranking Democrat, Sen. Max Baucus (D-Mont.), Kentucky Gov. Paul Patton (D) and Idaho Gov. Dirk Kempthorne (R) stated that the committee's proposal "does not recognize" that the "costs of the dual eligible population" are "more appropriately funded by Medicare as opposed to Medicaid." Instead, the letter says the proposal "goes the opposite direction and makes the dual eligible drug benefit a permanent responsibility of Medicaid." Patton and Kempthorne wrote, "The nation's Governors oppose this approach. It is not good health care policy and is not a good precedent." Instead, Patton and Kempthorne ask that the committee "redirect the funds currently allocated to pay Part B premiums to increase Medicare's responsibility for the actual drug costs of low-income beneficiaries" (NGA letter, 6/11).

House Action

House GOP leaders have said they expect to pass Medicare reform legislation by the end of the month and have nearly finished drafting their version (New York Times, 6/12). According to the Atlanta Journal-Constitution, the House Ways and Means Committee and the House Energy and Commerce Committee, both of which have jurisdiction over Medicare, could begin voting on reform legislation next week (Lipman, Atlanta Journal-Constitution, 6/12). Ways and Means Chair Bill Thomas (R-Calif.) and Energy and Commerce Chair Billy Tauzin (R-La.) yesterday said today they will provide House Republicans with a "detailed briefing" on their committees' joint $400 billion Medicare reform proposal (Wegner/Rovner, CongressDaily, 6/11). Under the proposal being developed by the two committees, which is similar to proposals approved by the House in the last two legislative sessions, beneficiaries could choose a stand-alone benefit for which they would pay a $35 monthly premium and a $250 annual deductible. The plan would cover 80% of beneficiaries' drug costs from $251 to $2,000 per year, after which there would be a gap in coverage before catastrophic coverage would take effect. Under a new provision not previously adopted by the House, the amount that a beneficiary would pay before qualifying for catastrophic coverage would be determined on a sliding scale based on income. Most beneficiaries would qualify for catastrophic coverage after spending $3,700 per year, but that figure would be higher for beneficiaries whose annual incomes are about $50,000 or higher. The plan would cover 100% of costs once a beneficiary qualified for catastrophic coverage (California Healthline, 6/11).

Defense

Thomas yesterday defended the sliding-scale provision in the proposal. "In a very expensive new program, those who have high incomes, $60,000 and up, should spend a few more dollars before they get taxpayers' help on the top end. What's wrong with that? ... It allows us to improve the benefits on the lower end," Thomas said (New York Times, 6/12). CongressDaily reports the House may not experience "smooth sailing" on Medicare reform. GOP leaders "must contend with" a group of senior Energy and Commerce Committee members who say the joint plan will not work. Rep. John Shadegg (R-Ariz.), a member of the group, said "We clearly have the ability to kill [the joint plan] in committee if we want to, and we also have the ability to mess it up on the floor." CongressDaily reports GOP leaders are currently negotiating with the group to allow several amendments to the legislation during floor debate (Wegner/Rovner, CongressDaily, 6/11).

Broadcast Coverage

The following broadcast programs reported on the Medicare reform proposals:

ABCNews' "World News Tonight": The segment includes comments from Sens. John Breaux (D-La.) and Rockefeller and AARP Executive Director Bill Novelli (Douglass, "World News Tonight," ABCNews, 6/11). The full segment is available in RealPlayer online.
CNN's "Wolf Blitzer Reports": CNN's Wolf Blitzer interviews Barbara Kennelly, president and CEO of the National Committee to Preserve Social Security and Medicare. (Blitzer, "Wolf Blitzer Reports," CNN, 6/11). The full transcript is available online.
C-SPAN's "Washington Journal": The program interviews Kennelly ("Washington Journal," C-SPAN, 6/12). The full segment will be available in RealPlayer online; after the broadcast.
NBC's "Nightly News": The segment includes comments from Grassley and Novelli (Brokaw, "Nightly News," NBC, 6/11). The full segment is available in Windows Media online.
NPR's "All Things Considered": The segment reports on Bush's choice of Chicago as the location for his speech yesterday (Norris, "All Things Considered," NPR, 6/11). The full segment is available in RealPlayer online.
NPR's "NPR News": NPR's Julie Rovner reports on Bush's speech and proposals in the Senate and House (Rovner, "NPR News," NPR, 6/11). The full segment is available in RealPlayer online.

This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.