Republican Lawmakers Call for Delay in Medicare Prescription Drug Benefit To Offset Hurricane Costs
The 110-member Republican Study Committee on Wednesday released a 23-page list of proposed spending reductions to offset hurricane recovery costs that includes a proposal to delay by one year the launch of the new Medicare prescription drug benefit, the South Florida Sun-Sentinel reports (Lytle, South Florida Sun-Sentinel, 9/22). Operation Offset is a list of suggested budget cuts intended to make up for the estimated $200 billion cost of recovery efforts from Hurricane Katrina (Dennis/Higa, CQ Today, 9/21).
The cuts recommended on Wednesday would result in savings of $139 billion this year and $544 billion over five years (South Florida Sun-Sentinel, 9/22). Many of the suggestions previously have been made by fiscally conservative members of Congress, but they have been rejected by the Bush administration or failed in Congress (Gordon, Long Island Newsday, 9/22).
"The biggest-ticket item" proposed by the RSC is the delay in the Medicare prescription drug benefit, which is estimated to save about $30.8 billion, the Los Angeles Times reports (Hook/Havemann, Los Angeles Times, 9/22).
"Now is the time to begin to make the tough choices necessary," RSC Chair Mike Pence (R-Ind.) said.
Senate Majority Leader Bill Frist (R-Tenn.) also said Congress might have to revisit the Medicare prescription drug benefit (Stone, USA Today, 9/22).
RSC also suggested increasing premiums for Medicare outpatient services by 20% and requiring beneficiaries to pay 10% of the cost of home health services. The two actions would save $45.3 billion over five years.
In addition, the RSC recommended implementing Medicaid copayments of up to $5 per office visit or prescription to save another $2 billion over five years (South Florida Sun-Sentinel, 9/22).
White House press secretary Scott McClellan rejected the proposal to delay the Medicare drug benefit, and House Majority Leader Tom DeLay (R-Texas) called the proposal a "nonstarter" (Los Angeles Times, 9/22). White House deputy press secretary Trent Duffy said, "Seniors are going to get the prescription drug benefit on time and on the current schedule because the president believes it is important to keep his commitment to senior citizens" (Koffler, CongressDaily, 9/21).
In "what is likely to be a sign of things to come," the U.S. Chamber of Commerce is planning to send a letter to congressional leaders stating its case for opposing a delay in the Medicare prescription drug benefit, The Hill reports. The chamber says that the government and a number of organizations have invested heavily in promoting the new benefit, and employers have factored the changes to Medicare into their business plans for next year.
John Rother, director of policy and strategy at AARP, said delaying the benefit "would throw things into mass confusion," adding that the group will "mobilize very aggressively" against such an action if the proposal goes forward."
Ken Johnson, senior vice president at the Pharmaceutical and Research Manufacturers of America, said, "Postponing the start of the Medicare prescription drug program would create mass confusion for seniors."
Neil Trautwein, a lobbyist for the National Association of Manufacturers, said a delay would be "catastrophic," adding, "We are so far down the road toward implementation" (Young, The Hill, 9/22).
Another option under consideration by House and Senate Republican leaders is an expansion of pending legislation that would cut spending in Medicaid and other benefit programs, the Times reports. However, Senate Budget Committee Chair Judd Gregg (R-N.H.) said it is "unrealistic" to expect more cuts unless the effort is part of a larger bipartisan federal budget deficit-reduction package that includes both tax increases and spending cuts.
Many Republican leaders are discussing an "across-the-board cut" in programs, the Times reports. However, Senate Finance Committee Chair Chuck Grassley (R-Iowa) said such a move would be "politically difficult" (Los Angeles Times, 9/22). Grassley also said that although the finance committee will examine offsets in the future, "we're going to take care of people in need first" (CQ Today, 9/21).
Additional information on the Medicare drug benefit is available online.