Senate Democrats Unveil Medicare Prescription Drug Benefit; House Democrats To Propose Separate Version

As expected, Senate Democrats on June 12 unveiled a Medicare prescription drug benefit plan, as their House counterparts prepared to release their own proposal on June 13, CongressDaily/AM reports. The House Democratic plan is expected to exceed the cost of both the $350 billion, 10-year House Republican plan and the $400 billion to $500 billion, eight-year Senate Democratic plan, totaling between $750 billion and $800 billion over 10 years (Rovner, CongressDaily/AM, 6/13). House Democrats initially had planned to wait to announce their proposal until House Republicans formally released their plan, but "internal pressure from the Democratic caucus to go on the offensive led to the earlier unveiling schedule," according to aides. The House Democratic plan is expected to call for a $100 deductible and a $25 monthly premium, with the government covering 80% of seniors' drug costs up to $2,000 and 100% above that. "We've got to do everything we can" to approve a Medicare drug benefit, House Minority Leader Dick Gephardt (D-Mo.) said, adding, "We've been talking about it for four years now."

A GOP Divide?
Latest drafts of the House GOP plan call for a $250 deductible and a $35 premium, with the government covering 80% of drug costs up to $1,000, 50% up to $2,000, and no coverage between $2,000 and $4,500. A 100% "catastrophic coverage" benefit would kick in after $4,500 (Fulton/Wegner, CongressDaily, 6/12). The plan would enlist private insurers to provide the coverage (Kaiser Daily Health Policy Report, 5/17). GOP aides said that the House Republicans would likely introduce their Medicare reform package, which includes the prescription drug benefit, on June 18, with mark up by the House Ways and Means and Energy and Commerce committees on June 20 and a floor vote expected the following week (CongressDaily, 6/12). The respective chairs of those committees, Reps. Bill Thomas (R-Calif.) and Billy Tauzin (R-La.), are reportedly divided over the degree of structural reform that the package may contain, and the two panels may mark up "somewhat different bills." Thomas, who favors greater reform, said the bill coming out of his committee will be a "Medicare modernization bill with a prescription drug benefit and provider [payment] updates" (CongressDaily/AM, 6/13).

Defying 'Conventional Wisdom'?
Meanwhile, Senate Democrats said they are confident that their drug benefit can be enacted this year despite the divergent approaches being proposed, Cox News/Washington Times reports. "We can and we will enact legislation this year," Sen. Bob Graham (D-Fla.), a co-sponsor of the bill, said, adding, "None of us are here because we buy into the conventional wisdom that nothing significant will be accomplished in an election year or a year which is dominated by a war on terrorism." Under the plan, which also has the support of Majority Leader Tom Daschle (D-S.D.), Majority Whip Harry Reid (D-Nev.), and Sens. Edward Kennedy (D-Mass.) and Zell Miller (D-Ga.), beneficiaries would pay a $25 monthly premium with no deductible, a $10 copayment for generic drugs and a $40 copay for brand-name drugs, and the government would cover all drug costs above $4,000. The plan also calls for reduced or no premiums or copays for low-income beneficiaries (Lipman, Cox News/Washington Times, 6/13). Graham said focus groups have shown that seniors prefer copays to coinsurance, and that his plan's use of a tiered drug benefit could produce savings by encouraging seniors to seek cheaper generic drugs (CongressDaily/AM, 6/13). But Thomas criticized Senate Democrats' proposal because it would expire in 2010 and require congressional reauthorization after that date. "The Senate has essentially offered a demonstration project when the need to provide prescription drug coverage for seniors has already been clearly and repeatedly established. It is a cruel hoax for the Senate to offer needed medicine only to take it away later," he said (Cox News/Washington Times, 6/13).

Questioning GOP Reliance on the Private Sector
The following are summaries of two opinion pieces published on June 13 addressing a prescription drug benefit:

• Writing in the South Florida Sun-Sentinel, Sen. Bill Nelson (D-Fla.) criticizes the House GOP plan, saying it "would allow private insurers to provide a lesser benefit" than the Senate Democratic proposal, of which he is a co-sponsor. "[I]f pinched between rising health care costs and limited Medicare reimbursements, some managed care companies simply might take their business elsewhere -- and leave consumers with nowhere to turn for the broader coverage they were promised," Nelson writes. He also calls the $250 deductible and the coverage gaps found in the House GOP plan "unconscionable," concluding: "We can, and must, do better" (Nelson, South Florida Sun-Sentinel, 6/13).
• "Of all th[e] problems with the [House] GOP bill, perhaps the most serious is that, unlike the Democratic bill's reliance on Medicare, it relies on private insurers, many of whom have stated that they will not participate in the program because they don't want to spend money toward it," Boston Globe columnist Robert Jordan writes. He concludes: "Perhaps, with the backing of the nation's populace and the hard work of key backers in Congress, [the Senate Democrats'] measure will be ready in time for me and others in retirement to finally reap what we have sown all these many years in the workplace" (Jordan, Boston Globe, 6/13).