White House Threatens To Veto Senate Budget Reconciliation Over Medicare Changes
The White House on Tuesday threatened to veto the Senate budget reconciliation bill (S 1932) if lawmakers do not remove a provision that would phase out a fund created two years ago to encourage insurers to offer prescription drug coverage under the new Medicare prescription drug benefit, the AP/Baltimore Sun reports.
Senate Finance Committee Chair Chuck Grassley (R-Iowa) -- whose committee approved phasing out the fund -- has said that insurers are participating in the drug program without subsidies.
The elimination of the fund would save about $5.4 billion over five years (AP/Baltimore Sun, 11/2).
Senate Republicans "would use some of the savings to provide a small increase in Medicare payments to doctors, instead of the 4.3% cut that would otherwise occur," the New York Times reports (Pear, New York Times, 11/2).
A Statement of Administration Policy issued Tuesday by the Office of Management and Budget says, "The administration strongly opposes the elimination of the fund because it is a critical component to ensuring regional [PPOs] in the Medicare Advantage program. This fund is a long-term investment that will promote the growth of the MA program" (CQ HealthBeat, 11/1). The statement adds, "If a final bill is presented to the president that limits the choices of seniors, takes away their prescription drug coverage or cuts the stabilization fund to increase Medicare spending, the president's senior advisers will recommend that he veto the bill" (Cohn, CongressDaily, 11/2).
The statement also "lodged less vehement objections" to other sections of the Senate bill, including many of the Medicaid provisions approved by the Senate Finance Committee, CQ HealthBeat reports (CQ HealthBeat, 11/1).
In related news, Sen. John McCain (R-Ariz.) said he and five or six other senators are meeting on Tuesday to consider an amendment that would delay the starting date for the Medicare drug benefit.
The plan "could throw a wrench" into Senate leaders' hopes of approving a reconciliation package that does not affect the Medicare drug benefit, CongressDaily reports. Both the Senate leadership and the White House oppose delaying the benefit, and the McCain group will "need the support of Democrats to succeed, something that might not be forthcoming," according to CongressDaily.
Sen. John Sununu (R-N.H.) said, "The question is, are Democrats willing to delay a bill that they have complained about for years now? Will they put their money where their mouths are? My guess is no" (Heil, CongressDaily, 11/2).
Newark Star-Ledger: "The Senate bill is truer to the purpose of [Medicare and Medicaid] and offers more protection to those at risk," a Star-Ledger editorial states. "The Senate plan wouldn't affect program beneficiaries," but the "House wants health care programs to operate like private insurance companies, not like safety nets for those who can't afford more," the editorial states (Newark Star-Ledger, 11/2).
- Robert Samuelson, Washington Post: The "[f]irst" step for curbing federal spending should be to "repeal the Medicare drug benefit," but "its chances are close to zilch," Post columnist Samuelson writes. "Last week, the Senate Budget Committee endorsed spending 'cuts' of $39 billion," but "the 'cuts' amount to a mere 0.3% ... of projected spending," Samuelson writes. Meanwhile, "[f]or almost any budget question, the Democrats have the same answer: Repeal tax cuts for the rich," Samuelson continues, adding that repealing tax cuts for the top two income brackets to pre-Bush levels "won't cover the Medicare drug benefit, let alone projected deficits" (Samuelson, Washington Post, 11/2).