Bush Signs Sweeping Medicare Bill That Includes Drug Benefit

New York Times via yahoo ^ | December 8, 2003 | CHRISTINE HAUSER The New York Times

[snopercod]

President Bush signed legislation today that creates a prescription drug benefit for the elderly, launching the biggest changes to the Medicare system since its creation in 1965.

"For the first time, we're giving seniors peace of mind that they will not have to face unlimited expenses for their medicine," Mr. Bush said just before sitting down at a desk in Constitution Hall, near the White House, and signing the new law, surrounded by applauding supporters and an audience of several hundred people. Presidential bill signings typically are set at the White House, on smaller scale.

The bill, which the government estimates will cost $400 billion over 10 years, would remake Medicare in part by offering drug benefits to 40 million elderly and disabled people while giving insurance companies and private health plans a huge new role in Medicare. The legislation also allows the elderly to set up health accounts in which they can set aside money tax free to pay for future health care.

Mr. Bush hailed the legislation in a televised 20-minute warm-up speech today, offering case studies of elderly people in the audience who he said would be among those to benefit from the Medicare overhaul.

The Republican-controlled Congress gave final approval to the bill on Nov. 25 when the Senate, voting 54 to 44, passed the measure, handing the president a political victory on an issue that has historically worked to the advantage of Democrats.

Eleven Senate Democrats, most of them moderates, joined 42 Republicans and one independent in voting for the legislation; 9 Republicans and 35 Democrats voted against it.

Republicans hope to embrace the legislation as political leverage in the coming election year. Even though a majority of Democrats voted against it, Mr. Bush said that its passage with at least a modicum of Democratic support showed that old partisan differences had been overcome to fulfill a promise to the elderly.

The Medicare overhaul comes at a time when the older segment of the population is growing rapidly, meaning the number of older voters will also be increasing.

"I visited with seniors around the country and heard many of their stories," Mr. Bush said today. "I'm proud that this legislation will give them practical and much-needed help."

But the legislation is not without its critics. Opponents think it risks undermining traditional Medicare, and there have been complaints that the coverage will not be comprehensive.

Medicare beneficiaries will not be allowed to buy insurance to cover their share of prescription drug costs under the new Medicare bill. Health economists have long asserted that when beneficiaries are insulated from the costs, they tend to overuse medical services.

AARP, the largest organization of older Americans, backed the legislation over the objections of some of its members and traditional allies in the debate on the proper role of government and private markets in providing health care to the elderly.

"This bill helps those who need it the most people with low incomes, as well as those with high drug costs," said AARP's chief executive, William D. Novelli, whose endorsement of the bill was crucial to its passage.

The new benefit, covering about 75 percent of drug costs up to $2,250 a year, would begin in 2006. Next year, Medicare beneficiaries could buy Medicare-approved drug discount cards, which officials say could reduce pharmacy bills by 15 percent or more.

When the bill passed the Senate last month, several Democrats charged that it would enrich insurance and drug companies at the expense of the elderly, who, Democrats said, would would be angry when they learned details of the bill.

"This is lousy legislation," said Tom Daschle, Democrat of South Dakota, the Senate minority leader. "We may spend the rest of our careers repairing the flaws of this bill." Mr. Daschle later introduced legislation that would repeal some of the new legislation's more contentious provisions and allow Americans to import cheaper drugs from Canada and Western Europe.

Under the bill, a Medicare beneficiary would be responsible for the first $250 of drug costs, and insurance would then cover 75 percent of costs up to $2,250 a year. Coverage would then stop until the beneficiary had spent $3,600 out of pocket (for a total of $5,100 in prescription drugs). Medicare would pay 95 percent of the cost of each prescription beyond that.

A Medicare recipient could stay in traditional Medicare and get drug coverage by signing up for a stand-alone drug insurance policy. Or the person could join a private plan covering drugs along with doctors' services and hospital care.

Elderly people with low incomes would receive additional assistance enabling them to buy drugs for $1 to $5 a prescription. Premiums and deductibles for their drug coverage would be reduced or eliminated.

Medicare beneficiaries with incomes of more than $80,000 a year would, for the first time, have to pay higher premiums for the part of Medicare that covers doctors' care.

The bill would also increase Medicare payments to doctors and hospitals, speed the marketing of lower-cost generic drugs and offer tens of billions of dollars in subsidies to employers to encourage them to continue providing drug coverage to retirees. The bill also emphasizes preventive health care.

Millions of Medicare beneficiaries have bought private insurance to fill gaps in Medicare. But a provision of the legislation prohibits the sale of any Medigap policy that would help pay drug costs after Jan. 1, 2006, when the new Medicare drug benefit becomes available.

[Southack]

"it does nothing to reduce the size of government and is fiscally irresponsible."

That's why I said that you were "embellishing". If you had said, this law does "less than desired amounts" to reduce government, that would be one thing, but saying that it does "nothing" is easily disprovable.

The Medicare Reform law has half a dozen Privatization options, any one of which, if taken to its full potential, could greatly reduce the size of government. Likewise, ushering in *preventative* medicine in place of the ancient Medicare insistence upon surgery and other reactive care is likewise a financial improvement with great potential.

At the very least, the Medical Savings Accounts in this new law give yet one more tax cut to Americans, a fine way of reducing government by starving the beast.

Thus, your argument is diminished by your repeated insistence upon using hyperbole that can so easily be disproved. Does "nothing" to reduce government, you claim?! Oh please.

Moreover, the cost may be a legitimate target, but the figures being tossed around are not the values authorized in this law. The Medicare Reform law only authorizes $39.5 Billion, flat rate, per year for each of ten years.

That's roughly $10 per month per American.

[Reagan Man]

>>>Who knows maybe they are right?

There's absolutely no evidence that says, spending $400 billion on this new Medicare PDP will lead to a privatization of the system.

Just got done listening to conservative Rep.John Shadegg of Arizona. He said "all the reforms went out the window" and that we could have assisted the elderly poor and seniors with catastrophic healthcare costs, without it costing $400 billion in unfunded mandates.

Shadegg is right, of course. But you'll never convince the centrist RINO's and wishy-washy moderates. They all support and enjoy paying for BIG GOVERNMENT.

[FirstPrinciple]

Makes two of us. I will probably vote Libertarian if they nominate someone sane. I will have my reservations if they nominate Harry Brown again.

[FirstPrinciple]

Congress has a pretty poor record when it comes to making Medicare competetive. All prior attempts to introducing competition has failed. A very good summary is this one:
http://www.heritage.org/Research/HealthCare/BG1708.cfm

[FirstPrinciple]

Of course not. The biggest problem in having any govt program is that it is not cost constrained. Health care cost is rising because govt keeps pumping money into the system. Heath care providers know it, pharmaceutical companies know it. There is built-in inflation because the govt purse string is always loose. The same is true for education as well. The cost will be so prohibitive that we have to have a huge tax increase, unless we get enough conservatives in Congress who would vote to end Medicare at that point.

[Reagan Man]

Look Southhack. I enjoy your posts that support PresBush and list all his accomplishments and I agree with most of what you have to say. In fact, I've referenced your points in support of PresBush and supplimented my own lists on several occasions in the past.

However, you are dead wrong on this issue and I've not engaged in any hyperbole. You're distorting the facts. Period.

>>>That's why I said that you were "embellishing". If you had said, this law does "less than desired amounts" to reduce government, that would be one thing, but saying that it does "nothing" is easily disprovable.

There is no up side to spending $400 billion in unfunded mandates. Especially when that $400 billion, will soon turn into $800 billion to $1.2 trillion, or more! I don't understand why you and others have such a hard time grasping the reality of the facts, as they exist. You do not spend $400 billion to reduce the size of government. That pure sophistry!

Many of the aspects of privatization that are contained in this new Medicare bill, are extremely limited in range and scope. The Heritage Foundation clearly spells this out in their analysis. I just got done listening to Arizona Rep. John Shadegg and he said and I quote, "the reforms went out the window". Shadegg said, we could have created a program that assisted the elderly poor and helped out seniors with catastrophic healthcare costs, without spending $400 billion in unfunded mandates.

You really need to wake up and get with the program.

[MrFreedom]

Biger Government

[Southack]

"There is no up side to spending $400 billion in unfunded mandates. Especially when that $400 billion, will soon turn into $800 billion to $1.2 trillion, or more!"

You are still doing it. You are still resorting to hyperbole rather than sticking to facts.

This particular Medicare Reform law authorizes $39.5 Billion per year for ten years. That's it. Any additional funds would have to come from *additional* legislation.

So don't tell me about Trillion Dollar cost estimates because such guesses (to be kind) aren't law, but rather *are* hyperbole.

Moreover, the clear, obvious upside to the $39.5 Billion Dollar cost is that we get an additional tax cut in the form of Medical Savings Accounts in addition to no fewer than 6 Privatization options for Medicare.

That's enormous "up side," and yet more evidence that contrasts with your hyperbole.

[Southack]

"I wont until you give me evidence."

You won't give President Bush credit for killing the Kyoto Treaty even in theory?!

Do you ever stop to listen to yourself. The rabid partisans on lp.org are more fair and open minded than you.

Look, if you want *me* to do your homework for you by presenting evidence of a Clinton XO that enforced the non-ratified Kyoto Treaty, then you will have to commit to giving President Bush credit for killing it upon seeing such proof.

If you won't make that commitment, then I would be wasting my time with you. In which case, you can go do that homework on your own.

[WVNan]

From what I read, this will not be helpful to my husband and me. We have Ex-press Scripts drugs where we pay $35 per perscription for 3-month supply. Plus my insurance co-pays on all my drug expenses that I buy out of pocket. The way I read it, I will have to give up these programs. I'm not liking that at all.

[FirstPrinciple]

It is impossible to prove something that is not true. In theory, a treaty is a law only if it is ratified. In theory, if you are passing an XO not based on law, it can be overturned in court. In theory, you are wrong. Show me the evidence. The only XO that I am aware of that Bush repealed was the level of arsenic in drinking water and I am not sure whether it was part of Kyoto. He was however forced to reinstate it.

[Southack]

Look, if you want *me* to do your homework for you by presenting evidence of a Clinton XO that enforced the non-ratified Kyoto Treaty, then you will have to commit to giving President Bush credit for killing it upon seeing such proof.

If you won't make that commitment, then I would be wasting my time with you. In which case, you can go do that homework on your own.

[FirstPrinciple]

OK. Go find it. However, it has to have the following limitation: The XO has to enforce a significant aspect of the Kyoto treaty, like CO2 emission. Even then, the only thing I will concede is that Bush overturned that XO, but the treaty has already been rejected by the Senate. That will not make Bush look like a conservative, just not an environmental nutjob.

[Southack]

"Even then, the only thing I will concede is that Bush overturned that XO, but the treaty has already been rejected by the Senate."

Nope. That's not worth it to me.

If you want me to do your homework for you, then you are going to have to fully commit to giving Bush full credit for killing Kyoto.

[LisaFab]

Thanks for the link. I agree, it ain't perfect, but just like the Education Bill, it's benefits will become apparent in the future.

[MrFreedom]

(Socialists What rights will you give up?

[Reagan Man]

You are misapplying the term hyperbole and you are engaging in pure sophistry. If you read the entire analysis by the conservative think tank, the Heritage Foundation, you'd get a better grasp of the reality behind creating this $400 billion unfunded mandate. The facts concerning this new Medicare spending program are obvious to anyone willing to see through the fog of politics.

Aside from abolishing the CETA program, I can't think of one government program that has been done away with in the last 40-years. Can you?

>>>Moreover, the clear, obvious upside to the $39.5 Billion Dollar cost is that we get an additional tax cut in the form of Medical Savings Accounts in addition to no fewer than 6 Privatization options for Medicare.

The devil is in the details. I'm not opposed to reform of Medicare, but there is little reform in this new package. First you have to get seniors to accept the options offered in Medicare. They will not be easily or readily accepted. When seniors see that they'd be better off staying under the government run healthcare coverage, they might choose not to buy into some private option that costs them more and gives them less in the long run.

In addition, Democrats know this is only the beginning and they look forward to expanding Medicare and prescription drug coverage under the bureaucratic umbrella of the federal government, paid for by the Americxan taxpayers. Since the GOP created this new bloated entitlement program, I doubt they'll be willing to stop the charge to increase the size and scope of Medicare in the future.

[snopercod]

Roger that. I can just feel my taxes going up as I type this.

Your feelings are correct. There is an automatic tax increase built into this bill. When costs go up, witholding taxes go up for the younger generation.

The "greatest generation" is turning out to be the "greediest generation".

[snopercod]

Don't lump all us baby boomers into the same category. Born in '46, I'm on the bow wave, and would rather pay for my own health care. I believe that most "seniors" feel this way, if polls are any indication.

The AARP supported this for two reasons: 1. It will line their corporate pockets, and 2. It will be a giant step toward full socialization of our medical industry.

See the post just above this one.

[snopercod]

I won't vote for him again either. We were sold a bill of goods. Been nice knowing both of us.