PRESIDENT CLINTON: Offers Larger Medicare Prescription Drug Benefit
President Clinton this weekend upped the ante in the prescription drug debate, proposing to use $58 billion of the projected budget surplus to ensure that no senior citizen pays more than $4,000 a year for prescription medications, the Washington Post reports. During his weekly radio address, Clinton said, "Because our economy is so strong, and because we've worked hard to put the Medicare trust fund back on sound footing, we have the money to do this now and do it right." Clinton's announcement comes just days before the full House is expected to vote on the Republicans' prescription drug plan and "appeared to be an effort to trump the Republicans' argument that only their proposal protects seniors against catastrophic drug costs," the Post reports. Under Clinton's revised plan, seniors would pay a $25 monthly premium, which would rise to $52 when the program is fully implemented. The plan would cover half of all drug expenses up to $2,500 -- eventually that limit would be $5,000 -- and all prescription costs beyond $4,000. The plan also would fully subsidize seniors living at 135% of the federal poverty level, or individuals with incomes of $11,300 and couples with incomes of $15,200 (Eilperin, 6/25). Clinton's revisions come with a heftier price tag. Initially, he proposed spending $38 billion over five years, but this plan would cost $79 billion over the same time period. Over 10 years, the new plan would cost $253 billion. The plan also would kick in earlier. Clinton had orginally proposed that the benefit begin in 2003, but he moved that timeline ahead to 2002. Clinton also proposed a program to begin in 2001 that would provide subsidies to HMOs of $25 billion over five years and $75 billion over 10 years to provide prescription drugs to Medicare recipients. Six million, or 16%, of the 39 million Medicare beneficiaries receive care under HMOs.
Who Has the Better Plan?
During his radio address, Clinton expressed concern with House Republicans' plan, saying, "What they have proposed is not a Medicare benefit. It's a private insurance program which many seniors and people with disabilities simply won't be able to afford." House Republicans have proposed that the government provide private insurers with subsidies to "encourage them to sell insurance covering the drug costs of Medicare beneficiaries." Recipients would pay monthly premiums of $37 and yearly deductibles of $250. Insurers would cover half of the next $2,100 in medication costs, with recipients' out-of-pocket expenses capped at $6,000 each year. But Rep. Nancy Johnson (R-Conn.) argued that Republicans' plan provides seniors with "a choice of at least two plans," while Clinton's proposal "would mandate a one-size-fits-all plan, and a senior would just have to take it or leave it" (Pear, New York Times, 6/25). House Ways and Means health subcommittee Chair Bill Thomas (R-Calif.) added that Clinton is "throwing money everywhere." Thomas said of Clinton, "He can't stand someone else being Santa Claus, even if it means he's bidding for seniors like they were on eBay and he was Bill Gates" (Washington Post, 6/25).