House Republicans Seeking Votes To Pass Medicare Package; House Democrats Introduce Bill

While House Republican leaders on June 26 "vigorously" worked to garner the votes needed to pass a GOP-backed $350 billion Medicare reform package that includes a prescription drug benefit, House Democrats formally introduced their own drug coverage plan, the Washington Post reports (Goldstein/Eilperin, Washington Post, 6/27). Despite reports that Republicans are about 24 votes short of passing their bill, the leadership "expressed optimism" that the bill could move to the floor as soon as June 27 (Rovner, CongressDaily/AM, 6/27). Republican leaders still are trying to work with some GOP members who have criticized the legislation. Some Republicans say that only low-income seniors should receive a Medicare prescription drug benefit, while others say they would oppose the measure unless it includes increased Medicare reimbursements for hospitals in their districts (Washington Post, 6/27).

One GOP Bill
Negotiations over the package did show signs of progress, as the leadership reconciled the differences between the two versions of the legislation passed last week by the Ways and Means and the Energy and Commerce committees (AP/Richmond Times-Dispatch, 6/27). To merge the committees' markups of the bill, Republican leaders agreed to lower the monthly premium seniors would pay for the drug benefit from $35 to $33 and set the cap on out-of-pocket expenses at $3,700 instead of $3,800 (Washington Post, 6/27). They also agreed to drop a $40 copayment for home health services that was included in the Ways and Means bill (AP/Richmond Times Dispatch, 6/27). As it stands now, the Republican measure would allow Medicare beneficiaries to purchase drug coverage directly from private insurance companies for a $250 annual deductible and a $33 monthly premium. Low-income seniors would be exempt from the premiums and deductible. The federal government would cover 80% of seniors' annual prescription drug costs up to $1,000, 50% up to $2,000 and no costs between $2,000 and $3,700, after which a catastrophic benefit would begin (Kaiser Daily Health Policy Report, 6/26).

Democrats Respond
Criticizing the GOP bill as "insufficient," House Democrats unveiled a plan that provides a "more extensive drug benefit at a much higher cost," the New York Times reports (Pear, New York Times, 6/27). The Democratic proposal, which would cost between $750 billion and $900 billion over 10 years, would cover 80% of seniors' annual drug costs up to $2,000 and 100% above that figure. Seniors would pay a $100 annual deductible and a $25 monthly premium (Kaiser Daily Health Policy Report, 6/21). Rep. Pete Stark (D-Calif.) said the Democratic plan "provides the necessary funding to provide a real, meaningful drug benefit that seniors and individuals with disabilities desperately need" (Stark release, 6/26).

Competing Proposals
The New York Daily News "Point/Counterpoint" section on June 27 features opinions from Reps. Eliot Engel (D-N.Y.) and Vito Fossella (R-N.Y.) on the competing Medicare prescription drug benefit proposals. Engel writes that the Democratic plan is "easy to understand" and ensures that "seniors would never again be forced to choose between buying lunch and paying for their heart medicine." The Republican plan, however, is "convoluted at best" and would require seniors to "hassle with [insurance companies that are] out to make a quick buck," according to Engel (Engel, New York Daily News, 6/27). Fossella, however, said the Republican plan is a "step in the right direction" because it "would not raise prices" or "reduce options" for seniors. The Democratic proposal, however, "is an overregulated bureaucratic prescription drug plan that would bring higher prices, higher copayments and higher taxes," Fossella concludes (Fossella, New York Daily News, 6/27).