June 19th, 2003
Washington Healthbeat
Until now, the Medicare debate has been fairly calm. But last night and
again this morning, the anger and suspicion beneath its surface erupted into
full view at a markup of reform legislation by the House Energy and Commerce
Committee. Fearing that revenues for traditional social programs will evaporate
from tax cut after tax cut, Democrats who may not quite have believed their
rhetoric of recent years that Republicans want "to end Medicare", acted as if
they believe it now. "I have never been as concerned about my country in my
life as I am today," Rep. Ted Strickland (D-OH) said this morning. President
Bush and the Republicans "are not conservatives. They are radicals," he
declared.
The discord was not enough to prevent the panel from approving the reform
package Thursday evening by a comfortable margin, 29 to 20. In addition, it
voted unanimously to send to the House floor H.R. 531, which would keep certain
funds allotted under the State Children's Health Insurance Program from
reverting to the U.S. Treasury. But the emotion at the markup suggests that
reaching a final congressional agreement on Medicare reform is no sure thing,
and that achieving reforms seniors can live with is even less certain.
A number of Democrats arrived at this morning's markup wearing black
armbands to commemorate what they said would be the end of Medicare in 2010 if
the House GOP leadership reform package (H.R. 2473) is enacted into law.
Specifically, they said the bill would end Medicare's guarantee since its start
in 1965 that beneficiaries receive a defined package of medical benefits.
Ending this entitlement would be a system in which the government helps seniors
pay premiums for benefits, which Democrats claim would erode as the playing
field tilted more and more in Medicare toward private plans. "I didn't come
here to preside over a time when Medicare was going to be destroyed," Rep. Jan
Schakowsky (D-IL) said this morning.
Exasperated with GOP claims that what seniors want out of Medicare is more
choices, Democrats said that Republicans are out of touch. Schakowsky, whose
past career includes counseling seniors on Medicare benefits, said last night
that what seniors want is a drug benefit, not a series of bewildering
differences in benefit designs. "If you think senior citizens like HMOs better
than Medicare, you're just missing the boat here," she added. Strickland,
meanwhile, entered into an exchange with Committee Chair Billy Tauzin (R-AZ)
about what seniors in their respective districts ask them for vis-à-vis
Medicare reform. Tauzin said they frequently tell him they want more choices.
Strickland said that's never happened to him in his district in Southeastern
Ohio, and Rep. Lois Capps (D-CA) said it hadn't happened to her in her district
either.
Rep. Frank Pallone (D-NJ) questioned the whole notion of seniors sitting
down and being able to compare plans, and said varying benefit structures would
render the notion of competition "somewhat meaningless." Schakowsky said
seniors can't somehow customize benefits in the way Republicans envision
because they don't know what their costs are going to be. "I don't see where
some of these things fit into anyone's average lives," added Rep. Anna Eshoo
(D-CA). "They're not asking for 72 insurance companies, come on!" Eshoo said
that while Republicans would be able to win every vote in the markup, she
cautioned that they are playing for larger stakes and could lose out with
seniors. "What are you doing," she asked. "What's so awful about Medicare that
you want to toss it on the floor and have it shatter into 10,000 pieces? I
think this is a march to folly."
Strickland pressed the Committee counsel on what would happen if no private
prescription drug plans decided to participate in a region. The counsel
repeatedly replied that the Congressional Budget Office has assumed that at
least two plans per region will participate because of the way the bidding
regions will be structured and the power of HHS to reduce a plan's financial
risk if it participates. Strickland wanted to know what would happen if the CBO
was wrong. When no alternative was offered, an incredulous Strickland demanded,
"Are you going to force them to come in!? What are you going to do?" "CBO can't
force a company into southeastern Ohio," Strickland said.
Exasperation and incredulity on the part of Democrats didn't get a rise out
of Republicans, but allegations that they are in the pocket of big drug and
insurance company corporate donors did. Rep. Sherrod Brown (D-OH) last night
linked drug industry victories year after year in Congress to their campaign
donations. After Brown asserted that committee markups this year and last were
scheduled around drug and insurance company fundraisers, Tauzin reprimanded
Brown and drew a round of applause from GOP members for doing so.
It was clear that when the markup resumed this morning, Brown wasn't going
to let the events of the previous evening go unaddressed. When he began to
defend his assertions of a link between millions of dollars in drug company
campaign donations and Republican actions, Tauzin cut him off. "Mr. Brown!,"
Tauzin interjected. "Are we going to go through that again today!?" Tauzin said
that if Brown continued to "impugn our motives," Tauzin would have Brown's
words "stricken down." Brown should debate the issues and not speak of anyone
personally in the markup, Tauzin said. Brown responded that he wasn't speaking
of anyone personally, but of a link between donations and GOP actions.
Tauzin said Brown should save his commentary for political campaigns and
that in the interests of committee comity, "members are not to question each
other's intentions and motives." Brown said "I don't think it's a coincidence
that the drug industry gets its way year after year after year." Tauzin said
that if Brown was going to continue in that vein then Republicans could start
in too. Brown responded that if that were to happen then maybe the public could
get a better understanding "of all the campaign fundraising that goes on around
here." Tauzin asked whether Republicans should start talking about all the
campaign donations Democrats get from the drug industry. Brown responded that
"I don't think that's a debate you want to get into," asserting that 80 percent
of drug industry campaign contributions go to Republicans.
Brown then went on to offer an amendment to put the prescription drug
benefit into traditional Medicare without going through the vehicle of private
plans. He recounted GOP criticism of the program over the years and said
"Republicans have never liked this program." Pallone then picked up the theme
of Republicans wanting to "kill Medicare" and said the motive may be
ideological rather than campaign donations. Democrats are worried about a
return to the days before 1965 when many seniors had a hard time getting health
care, Pallone said. Rep. James Greenwood (R-PA) responded that "as usual the
gentleman from New Jersey takes the debate right down to the lowest common
denominator." Greenwood said "it has nothing to do with ideology. It has
nothing to do with campaign contributions." To think that "any member of
Congress would wake up in the morning and say, 'How can I kill Medicare today,'
I think that's stupid!"
But Democrats didn't stop. Schakowsky reminded Tauzin of his reproach to
Brown for making political speeches. That's because "this is a political
debate," Schakowsky said. "It is very political. Yes indeed. It is political."
Democrats said that private sector reforms in the bill weren't intended to save
money but to privatize the program. The assumption of GOP market-based reforms
is that they will save Medicare money, yet that's really not the case - "maybe
a dollar or two," she said. Rep. John Dingell (D-MI) noted a new Congressional
Budget Office estimate that private plan reforms would save only $1.6 billion
over 10 years. He said those reforms are a calculated attempt to end
traditional fee for service in Medicare.
Democrats also questioned the wisdom of making sweeping market-based reforms
when private plans literally may not show up. Congress Daily quoted two Wall
Street analysts at a Washington, D.C. forum yesterday as expressing serious
doubts that the private plan frameworks envisioned in both the Senate and House
Medicare bills would work. While the Senate bill anticipates pharmacy benefit
management companies taking on risk for the drug benefit, "I doubt there's a
PBM that would agree to accept risk," Norm Fidel of Alliance Capitol Management
was quoted as saying. Both Fidel and Roberta Goodman of Merrill Lynch said that
the plans would only work if insurance companies back up the PBMs, but the
analysts suggested that insurers would have little if any interest, the
newsletter reported.
The criticism and partisan rancor of the past 24 hours at Energy and
Commerce and earlier in the week at Ways and Means seems unlikely to derail
House passage of H.R. 2473. But the impact on seniors of the intense criticism
by House Democrats that Medicare is at risk bears watching. House and Senate
negotiators may be able to lessen the criticism and any senior anxiety it
causes by dumping the provision in the House bill that creates head-to-head
competition between private plans and traditional Medicare starting in 2010.
But survey results released today (see below) suggest that seniors aren't
exactly aching for private plan competition, a major reform element in both the
Senate bill and in even a modified House bill (younger people are more
receptive, however). And to the extent congressional leaders decide to downplay
private plan reforms, they risk losing conservative support for Medicare
reform. These crosscurrents in the debate suggest that while prospects remain
favorable, reform isn't certain.
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