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AARP balks at drug plan Stance could derail Medicare benefit

By William M. Welch
USA TODAY, July 17, 2003

WASHINGTON - The nation's largest organization of seniors is threatening to oppose a prescription-drug benefit for Medicare recipients unless its objections are met, a move that could jeopardize action in Congress.

AARP, which has 35.5 million members, warned Congress this week that separate versions of the legislation passed by the Senate and House of Representatives offer inadequate benefits and could do more harm than good. It said it ''will not hesitate to oppose'' a final version unless improvements are made.

The group, formerly known as the American Association of Retired Persons, has worked for years to get prescription-drug benefits included under Medicare. Its membership -- second in the USA only to the Roman Catholic Church -- gives the group tremendous clout on Capitol Hill.

This year, AARP has worked behind the scenes in the prescription-drug debate. Its aggressive approach reflects its fear that Congress is headed toward an insufficient benefit package and other changes in Medicare that could weaken the federal health care program for Americans 65 and older.

''The more people hear about it, the less happy they are,'' William Novelli, the group's CEO, said in an interview.

AARP's opposition could:

* Help defeat the bill by persuading lawmakers to reverse their support.

* Cause political trouble for those who support the plan. Two in every three registered voters age 50 and older cast ballots in the 2000 election, compared with 48% of those younger than 50.

AARP detailed its objections in an eight-page letter to Congress. Novelli said AARP's members are unhappy and confused about the potential drug benefit in the 10-year, $400 billion plans. He said the group is telling its members to contact their senators and representatives. Thousands of seniors have done so.

''AARP is reflecting its membership here,'' said Robert Laszewski, a health consultant. ''That is an indication that seniors are having second thoughts.''

Sen. John Breaux, D-La., one of the lawmakers seeking to bridge differences between the Senate and House bills, said congressional negotiators might accommodate AARP's concerns.

''If they strongly oppose the bill, it would cause some people some grief in voting for it,'' he said.

The House bill, written by Republicans and opposed by AARP, goes further than the bipartisan Senate bill in encouraging seniors to switch from traditional Medicare to a new managed-care health plan that private insurers would be encouraged to create with federal subsidies.

In his letter, Novelli said a central concern was a drug benefit that would require substantial payments by seniors. He also said the bill must guarantee that the government will provide a drug benefit if no private insurer steps in.

The group also voiced concern that either bill could encourage employers now offering drug coverage to their retired workers to drop that benefit.

Both parties and the AARP want to avoid a repeat of 1988, when Congress passed an AARP-backed plan to provide insurance coverage for catastrophic illnesses. Seniors revolted after they learned that it would require higher premiums from more affluent recipients. Congress repealed it in 1989.