MEDICARE REFORM: Clinton Hopes New Study Will Boost Plan
Medicare reform will be necessary as the number of Medicare beneficiaries is expected to double to 80 million over the next 30 years. The White House released a new state-by-state study of the program yesterday, the Associated Press reports, that aimed to coincide with yesterday's Senate Finance Committee hearing on the subject. President Clinton hoped the study would persuade Republican lawmakers to drop their tax cut plan and adopt his reform plan that includes a prescription drug benefit. "This report is the most compelling evidence to date that we must strengthen and modernize Medicare for the long run," Clinton said (Galvin, 2/29). According to the report, women account for 57% of all Medicare beneficiaries. More than half of Medicare beneficiaries in 15 states live in rural areas where access to health care is "spotty." In 40 states, one in 10 Medicare recipients is classified as "old elderly" -- those over the age 85 -- many of whom live in upper Midwest states like the Dakotas, Kansas, Iowa, Minnesota and Nebraska. Clinton said, "This is the fastest- growing group of seniors, and they require the greatest amount of care. They will spend ... almost a quarter of their lives on Medicare" (Gearan, AP/San Jose Mercury News, 3/1).
Push for the Plan
Clinton's plan calls for dedicating the non-Social Security portion of the budget surplus to Medicare and establishes a prescription drug benefit for all beneficiaries. Republicans have questioned the all-encompassing drug benefit, worrying that it might prove too costly. They have offered their own need-based proposal. According to the report, most Medicare beneficiaries would be classified as middle income or higher and not eligible for the benefit. Clinton asserted that establishing a means cap would lock out a large number of the middle income elderly who also need coverage. "I believe that, when they read this report, they will understand what the consequences of such a decision would be. We owe it to the American people to seize this opportunity this year" (Associated Press, 2/29).
Experts Call for Compromise
Medicare experts argued yesterday before a Senate Finance Committee hearing that the reform measure proposed by Sens. John Breaux (D-La.) and Bill Frist (R-Tenn.), could be combined with the White House plan, CongressDaily reports. Both plans would incorporate market competition into the Medicare system, "presumably leading to lower health care prices." Breaux said, "I don't think the differences are irreconcilable, at least in this particular area." Finance Chair William Roth (R-Del.) argued that the "key to the success" of potentially combining the plans is whether they create market incentives allowing beneficiaries to become educated consumers. "It is this prudent consumer behavior that over time would allow for slower growth in both beneficiary and taxpayer costs," Roth said. Although Stanford economist Mark McClellan explained that the White House plan provides more immediate security, he argued that HCFA needs to improve its reimbursement process and provide better information to patients about their health care options. McClellan also noted that pilot projects that cap Medicare payments may allow more available monies to care for acutely ill patients. Responding to several questions from Democratic members about rural coverage, Jeff Lemieux, a senior economist at the Progressive Policy Institute, said that if the Medicare reform legislation is structured correctly, there would be an "adequate amount of choice" of plans in rural areas (Fulton, 2/29).