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Bush Proposes Drug Benefit for the Low-Income Elderly
Mr. Bush also proposed a big increase in Medicare payments to health maintenance organizations, in the hope that he could reverse their exodus from the program. In addition, the president said he wanted to create two options for private health insurance that would fill gaps in Medicare. The new Medigap plans would cover prescription-drug costs. Mr. Bush's proposals represent an effort to seize the initiative on an issue highly likely to figure prominently in the Congressional elections in the fall. "We need a comprehensive reform plan that includes prescription drugs for every senior," Mr. Bush said at a meeting where he discussed Medicare with about 12 members of Congress. The White House said Mr. Bush's budget, to be announced next Monday, would earmark $77 billion of the $190 billion to provide drug benefits through Medicaid to low-income elderly people. Lawmakers from both parties said Congress would provide at least 50 percent more than the $190 billion that Mr. Bush is requesting. Speaker J. Dennis Hastert, Republican of Illinois, said last week that drug coverage was a priority for Republicans, and John P. Feehery, a spokesman for Mr. Hastert, said the speaker wanted to set aside $300 billion, the amount included in the 10-year budget blueprint that Congress adopted last year. Senator Olympia J. Snowe, Republican of Maine, one of those who met Mr. Bush today, welcomed his drug proposal, but said she believed that $300 billion was needed. Representative John D. Dingell of Michigan and Senator Bob Graham of Florida, both Democrats, said the president's proposal fell far short of meeting the need. "It's like putting a Band-Aid on a broken leg," Mr. Dingell said. Medicare provides health insurance for 40 million people who are elderly or disabled. But it does not generally cover prescription drugs outside hospitals. Three of the 10 standard Medigap plans now provide drug benefits. But the premiums are so high that just 500,000 Medicare beneficiaries choose those options, the White House said. Most Democrats and many Republicans in Congress say they want to provide drug coverage to all Medicare beneficiaries, regardless of income. Experts have said it will take three years to put such a program into operation. As a first step, Mr. Bush urged Congress today to provide drug coverage immediately to Medicare beneficiaries with annual incomes from 100 percent to 150 percent of the official poverty level, $11,610 to $17,415 for a two-member family. That proposal would provide comprehensive drug coverage for up to three million low-income Medicare beneficiaries who now have no drug coverage, the White House said. Under the proposal, it said, the federal government would pay 90 percent of the costs for drug coverage and the states 10 percent. The states would administer the assistance and would determine eligibility. As part of the proposal, states could also provide drug coverage to Medicare beneficiaries with incomes below the official poverty level. But the federal government would cover a smaller share of the cost, from 76 percent in a poor state like Mississippi to 50 percent in affluent states like New York, New Jersey and Connecticut. Without waiting for action by Congress, Mr. Bush said his administration would help states use Medicaid to provide drug coverage to low-income elderly people. The standard Medicaid program covers a wide range of health-care services, and all states have chosen to cover prescription drugs, as well. Under Mr. Bush's proposal, the federal government would allow states to run demonstration programs that would provide Medicaid coverage to elderly people just for prescription drugs. Tommy G. Thompson, secretary of health and human services, approved such a program today under which Illinois will provide drug coverage to 368,000 low-income elderly people. Mr. Thompson said he would allow other states to "use federal Medicaid dollars to extend prescription drug coverage" to Medicare beneficiaries and other people with incomes up to twice the federal poverty level, or up to $23,220 for a two-member family. The Pharmaceutical Research and Manufacturers of America, the chief lobby for the drug industry, said it was pleased to see that Mr. Bush was "strongly committed to enacting a Medicare prescription- drug benefit available to all seniors this year." The drug industry has recently sued to prevent several states from using Medicaid to provide drug benefits to elderly people who would not otherwise qualify for Medicaid. Senator Edward M. Kennedy, Democrat of Massachusetts, said Mr. Bush was offering "recycled proposals that fall short of meeting the urgent and growing need for a real Medicare prescription drug benefit." Robert M. Hayes, president of the Medicare Rights Center, a consumer group in New York, said that the budget "obviously recognizes the political imperative of making medicine affordable to the American people." But Mr. Hayes added: "Does this do it? Not by a long shot." While "half a loaf is obviously better than nothing," he said, it could diminish "political support for the full and comprehensive benefits that the nation really wants." Diane Rowland, executive vice president of the Kaiser Family Foundation, a health-research group, noted that even with $300 billion on the table last year, lawmakers had a hard time creating a drug benefit attractive to most of the elderly. The out-of-pocket costs were simply too high, with elderly people expected to pay as much as $50 a month in premiums, plus half the cost of each prescription. Karen M. Ignagni, president of the American Association of Health Plans, which represents H.M.O.'s, said the plan to increase payments to them was "a very positive step."
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