GEORGE W. BUSH: Unveils Long-Awaited, $198B Health Plan
Addressing a "crucial element" of his presidential agenda, Texas Gov. George W. Bush (R) yesterday unfurled his 10-year, $198 billion Medicare reform package, which includes a prescription drug benefit, the Washington Post reports. "Keeping the promise of Medicare, and expanding it to include prescription drug coverage, will be a priority of my administration," Bush announced at a campaign stop in Allentown, Pa., adding, "Medicare is an enduring commitment in our country. It must be modernized for our times." Under Bush's plan, seniors making $11,300 or less and couples making $15,200 or less annually would receive full coverage for monthly Medicare premiums and copayments, while seniors making $14,600 or less and couples making $19,700 or less annually would receive partial coverage. The government would finance 25% of premiums for remaining Medicare patients. In addition, the Bush proposal includes a "catastrophic coverage" provision that would cover prescription drug costs higher than $6,000 per year for any senior. Bush would allocate $110 billion to revamp Medicare, $48 billion to help states immediately subsidize drug coverage and $40 billion to restore cuts to reimbursement rates for doctors and hospitals. "Eight years ago, Bill Clinton and Al Gore promised Medicare reform. Four years ago, they did the same. ... [O]ur patience is wearing thin. This is not a time for a third chance. It is a time for new beginnings and new leadership," Bush concluded (Allen, Washington Post, 9/6).
Innovative Idea or Fated Flop?
Through his plan, Bush hopes to encourage "private market alternatives" for Medicare and spur competition among providers to lower overall health costs, a move lauded by some health industry officials. "It's a serious proposal that will help make prescription drugs more affordable for those most in need," Health Insurance Association of America President Chip Kahn said. Karen Ignagni, president of the American Association of Health Plans, added that HMOs could "play a role, definitely, in delivering this benefit" under Bush's plan (Pear/Toner, New York Times, 9/6). Still, pharmaceutical industry officials "privately groused" about Bush's decision to rely on state programs to provide drug coverage, fearing states will demand the same price discounts they receive under Medicaid. In addition, many state governors, including Republicans, have expressed concern about a state-based drug benefit (Calmes/McGinley, Wall Street Journal, 9/6). According to HHS Secretary Donna Shalala, "Under the Bush plan, there will be wide variations (in drug coverage) across the country. Geography and what kind of health plans you have in your area will determine what you get." John Rother, an AARP lobbyist, warned that Bush's private sector plan would "be a tough sell" with many HMOs already exiting the Medicare program this year (Goldstein, Washington Post, 9/6). He added, "Most people want to know how much we'll pay and what we will get. We can [not] say that ... with Bush's plan. We'll have to wait and see" (Appleby, USA Today, 9/6). Calling the drug coverage offered by Bush "at best, spotty," Families USA Executive Director Ron Pollack said, "We fear that this system would wither away the fee-for-service system that five out of six seniors depend on today" (New York Times, 9/6).
With his plan, Bush also hopes to stave off attacks from opponent Vice President Al Gore, who last week challenged Bush to "put up, or shut up" on Medicare reforms, claiming that Bush has "no true commitment" to a prescription drug benefit (New York Times, 9/6). Under Gore's 10-year, $253 billion drug benefit plan, low-income seniors would receive full prescription drug coverage under Medicare, while remaining seniors would pay for half their pharmaceutical costs up to $5,000 a year (American Health Line, 9/5). "The biggest problem [with Bush's plan] is there is no money to pay for it, if he gives away all of the surplus in a giant tax cut for the wealthy," Gore said at a Columbus, Ohio, campaign stop yesterday (Wall Street Journal, 9/6). Democratic pollster Jennifer Laszlo Mizrahi agreed, noting, "The Bush plan doesn't cover a significant portion of the middle class, and it is woefully underfunded because he has already given away the entire surplus in tax cuts for the rich." According to GOP pollster Frank Luntz, however, Bush's announcement will likely stifle the momentum Gore mounted last week by campaigning on health issues. "Bush has already showed ... that he can take a Democrat issue and make it a Republican one," he said, adding, "the Clinton-Gore proposal has so many holes in it, it looks like Swiss cheese. Bush has to point out those holes" (Cleary/Butler, Investor's Business Daily, 9/6). Congressional leaders, who may move to pass Bush's Medicare reforms before Congress adjourns next month, remained divided on the issue. Senate Majority Leader Trent Lott (R-Miss.) called Bush's plan a "good package," while Minority Leader Tom Daschle (D-S.D.) dismissed the proposal as "too little, too late," adding that Democrats remain "unwilling to accept a bill that does not meet minimum criteria," including universal coverage (Allen, Washington Post, 9/6).