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Drug Bill for Elderly Advances, and Stalls
A Republican bill to provide prescription drug benefits to the elderly was approved early today by one House committee, but became bogged down in another panel, where Democrats denounced the legislation as a gift to the drug industry in return for large campaign contributions. Despite the partisan fight, the legislation still appeared to be headed for a vote on the House floor next week, just before lawmakers take a recess for the Fourth of July. By a vote of 22 to 16, largely along party lines, the House Ways and Means Committee approved the bill, which authorizes the government to pay tens of billions of dollars in subsidies to insurance companies to induce them to offer drug coverage to Medicare beneficiaries. Medicare generally does not pay for prescription drugs outside a hospital, and nearly one-third of the 40 million elderly and disabled people on Medicare have no insurance for such costs. The House Committee on Energy and Commerce began voting today on nearly identical legislation, after Republicans chopped it up into 12 bills — a procedural tactic that limited the Democrats' ability to offer amendments. The two committees share jurisdiction over Medicare. The Republican proposal, generally supported by President Bush, provides $310 billion over 10 years for Medicare drug benefits, a type of coverage long sought by the elderly. But Democrats said the Republicans were beholden to the drug industry, and they said this relationship was symbolized by the fact that the Energy and Commerce Committee quit work this afternoon so Republicans could attend a fund-raising dinner organized with major assistance from the drug industry. "The bill is a political payoff, a nice payback, to the pharmaceutical industry," said Representative Frank Pallone Jr., Democrat of New Jersey. Representative Sherrod Brown, Democrat of Ohio, said, "It's outrageous, and it shows the corrosive influence of corporate money in Congress and on the Republicans." Representative Thomas M. Davis III of Virginia, chairman of the National Republican Congressional Committee, which is coordinating efforts to keep the House under Republican control, said: "It's the height of hypocrisy for Democrats to point the finger at us. Less than 10 percent of the money being raised tonight comes from drug companies. The Democrats depend even more heavily on money from special interests, like trial lawyers and labor unions." Mr. Davis said the dinner, featuring President Bush, would raise more than $25 million for Republican candidates. Drug companies support the Republicans' general approach, which depends on competing private insurers to devise and market drug insurance policies — a product that does not exist. Republicans bar the federal government from setting drug prices or establishing a uniform list of preferred drugs. Even so, many drug company executives say they are apprehensive that the Republican bill could eventually lead to some form of price regulation, or at least government pressure on drug companies to hold down prices. Estimates from the Congressional Budget Office show that under current law, with no additional benefits, Medicare spending will grow more than 90 percent, to $490 billion in 2012, from $252 billion this year. In some way, the federal government regulates the price of almost every item or service covered by Medicare. The Democratic-controlled Senate has shown little interest in the private-sector model favored by many Republicans. The chief actuary of the Medicare program, Richard S. Foster, a civil servant, predicted today that at least 95 percent of Medicare beneficiaries would voluntarily sign up for the drug benefits offered under the House Republican bill. The Health Insurance Association of America opposed a similar bill passed by the House two years ago, saying that it would appeal almost exclusively to people with high drug expenses. But Dr. Donald A. Young, president of the association, said the new bill offered more generous benefits. As a result, Dr. Young said, more people would sign up for drug coverage, and "there is now a much better chance that our members will offer the benefit." Under the bill unveiled on Monday by House Republicans, Medicare beneficiaries who sign up for drug coverage would not have to spend more than $4,500 a year of their own money on prescription medicines. In the last three days, Republicans decided to lower that limit to $3,800. Medicare would cover all drug costs beyond that. House Republicans have repeatedly said that drug coverage would be available under their bill for a monthly premium of $34 or $35, based on estimates from the Congressional Budget Office. But Patrick J. Morrisey, a member of the Republican staff of the Energy and Commerce Committee, told the panel today that "the specific premium amount is not fixed" in the bill. The premiums, he said, would be based on bids submitted to the government by insurance companies, and the government could try to negotiate changes. Representative John D. Dingell, Democrat of Michigan, said the bill did not establish any criteria for evaluating bids from insurers. As for the $35 figure, he said, "That's hooey." By a vote of 23 to 17, the Ways and Means Committee rejected a Democratic proposal to set a uniform premium of $35 a month. Representative Jim McDermott, Democrat of Washington, said he worried that insurers would lure Medicare beneficiaries with low premiums, then "jack up the price" of drug coverage in later years. FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Action on Aging distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.
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