Lawmakers Work to Wrap Up Medicare Bill

Enjoying the blessing of the politically influential AARP (search), President Bush on Monday began the push for one of his top legislative priorities — providing a prescription drug benefit to America's seniors.

Bush met with lawmakers on the 10-year, $400 billion package of benefits — the largest expansion of social services in America since the Great Society — and practically dared negotiators to stop a bill that provides subsidized drug coverage to 40 million elderly Americans.

"This vote will indicate whether the House and Senate will help keep our commitment to our seniors. I urge members of both political parties to study the legislation and remember the promise we've made to America's seniors and vote yes," Bush said.

But storm clouds formed Monday as liberal Democrats, including Sen. Ted Kennedy of Massachusetts, a top Democratic negotiator on health issues, talked about, but did not promise, a Senate filibuster.

"This is a hijacking of the Medicare system. I'm opposed to it. I think as more and more people find out about it, I feel it will drop of its own weight," Kennedy said.

Kennedy said the legislation offers private insurers more money to insure seniors than traditional Medicare spends on them. He also attacked a proposal for direct competition between Medicare and private plans that he said would increase premiums for those opting against managed care.

Despite criticism from Kennedy, the bipartisan bill won the support of the AARP, the nation's most powerful seniors lobby, boasting 35 million members.

"We think this is a historic piece of legislation and we think it needs to pass and we're going to do whatever we can to try to help it pass," said Chris Hansen, executive associate director of the AARP.  AARP plans to launch a three-day television advertising campaign to support the legislation.

Last week, Senate Minority Leader Tom Daschle accused the AARP of caving to Republican pressure. Hansen said nothing is farther from the truth.

"We were not badgered into supporting this bill. We do support this bill and we haven't been badgered by anybody into this," Hansen said.

The bill is not perfect, added William D. Novelli, CEO of AARP, "but the country can't afford to wait for perfect. On balance, it's the right thing for seniors in America and their families."

Other supporters of the bill include the American Medical Association (search) and American Hospital Association (search). The AFL-CIO announced its opposition to the package.

The new Medicare drug coverage bill takes effect in 2006.  It requires a $275 deductible and an average monthly premium of $35 for drug costs of up to $2,200. Medicare will pay 75 percent of the costs as well as almost all the costs over $3,600 for yearly catastrophic drug coverage. It will provide no coverage for drug costs between $2,200 and $3,600.

Until the full benefit kicks in in 2006, seniors will receive Medicare-approved drug discount cards that could cut costs for each prescription by 25 percent. Low-income seniors will receive a direct drug subsidy of up to $600 per month until full benefits go into effect.

In its effort to control drug costs and ensure quality drugs, the bill maintains a ban on importation of low-cost drugs from Canada. It also offers a tax break for individuals who purchase health insurance with a high deductible, and it requires the president to propose legislation if Medicare spending exceeds a fixed percentage of government revenues. 

Montana Democratic Sen. Max Baucus, ranking member of the Senate Finance Committee and co-author of the bill, said it would be bad news for Democrats to try to kill the bill.

"If Democrats stand up and filibuster or oppose the bill, I think, frankly Democrats will be blamed for failure to pass legislation that would finally begin to help our senior citizens," he said.

But some Democratic presidential candidates are willing to take that chance. Howard Dean and Wesley Clark said Monday that the package is a giveaway to private insurers that will end up damaging the federal program in the long run.

"The bill coming out of Congress violates the basic principle of the Hippocratic oath — first do no harm," Clark said in a statement.

"The damage this bill causes to our seniors will come back to haunt this administration and those who support it for years to come," said Dean, a physician. As members of Congress, five of the Democratic candidates — Sens. John Kerry, Joe Lieberman, John Edwards and Reps. Dick Gephardt and Dennis Kucinich — will be asked to vote on the bill.

After five months of bargaining, Republicans did make late-hour concessions to secure an agreement with Baucus and Louisiana Sen. John Breaux, the other Democratic negotiator. One compromise meant including extra steps to discourage private companies from dropping coverage for retirees once the new federal benefit begins.

The bill does offer private health plans the chance to take over seniors health care coverage under managed care plans. It creates an experimental program of competition in six metropolitan areas beginning in 2010. Supporters call it a relatively small set of competitive programs that will help hold down the growth in the program's costs. Kennedy calls it a "$12 billion slush fund." 

While the talk in Washington is all about a Senate filibuster, the bill must first pass the House of Representatives, and some problems could lie there too. Conservative House Republicans sought but did not receive language in the bill that would expose Medicare to greater private sector competition.

House Republican members say they are not pleased with the reduced private alternatives. House GOP leaders are planning to sit down with them over the next few days and try to win their votes before the House goes to debate on the package on Friday.

Fox News' Major Garrett and The Associated Press contributed to this report.