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CONDITION CRITICAL
July 15, 1997TRANSCRIPT |
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As Congress continues to discuss tax cuts, the largest and most politically sensitive portion of the federal budget, Medicare, remains in legislative limbo. The Senate and the House have begun hammering out the differences between their versions of Medicare reform. Following a background report on the continuing debate, Margaret Warner leads a discussion over what should be done to manage this entitlement program.
A RealAudio version of this NewsHour segment is available.
July 15, 1997:
Senator John Breaux (D-LA) and AARP representative Martin Corry debate changes to the Medicare system.
June 6:
The House Republicans called for the creation of medical savings accounts [MSAs] in their version of health insurance reform legislation
May 15:
A year-old pilot project to crack down on Medicare fraud in Florida is working.
March 4:
The Senate passes the Kennedy-Kassebaum Bill.
March '96:
Explore a week of special NewsHour reports on health care issues.
December 25:
Cuts in Medicare take their toll on the U.S. health system's capacity to conduct graduate medical education.
Browse The NewsHour's Medicare coverage.
MARGARET WARNER: The $200 billion-a-year Medicare program provides health care benefits to 38 million elderly and disabled Americans. It is financed through a complicated mix of taxes paid by today's workers and premiums and other charges paid by the elderly. The financing is further complicated by differences between the two different types of Medicare programs--part A, which covers hospital and home care bills; and part B, which covers doctors' bills. Taken altogether, the cost of the Medicare program is growing at more than 8 percent a year, a rate many analysts say will balloon further as the ranks of America's elderly grow.
But efforts to rein in Medicare costs have proved politically explosive. In 1988, the powerful House Ways and Means Committee Chairman, Democrat Dan Rostenkowski, was set upon by seniors--literally--after Congress hiked Medicare premiums to fund catastrophic care. Six years later, in 1994, a newly Republican congress proposed $270 billion in Medicare savings. That too ran into vociferous opposition from the elderly and from many Democrats.
REP. JIM NUSSLE: I've got two grandmothers who want Medicare reformed, and we want to know why you're delaying it on the floor.
REP. CHARLES RANGEL: You ought to be ashamed of yourself for what you're doing, not to-- Don't do that to your grandmother.
REP. JIM NUSSLE: You ought to be ashamed.
REP. CHARLES RANGEL: You ought to be ashamed what you're doing to the American people.
MARGARET WARNER: In the end, some savings were made--but nothing like what the Republicans had proposed. In the 1996 presidential and congressional campaigns, the Democrats made political hay out of the issue.
AD SPOKESMAN: The Republicans are wrong to want to cut Medicare benefits. And President Clinton is right to protect Medicare.
MARGARET WARNER: But this year, with the election over, the President and Republican leaders in Congress agreed to a budget deal that would save $115 billion over five years, with unspecified Medicare changes.
SEN. JOHN BREAUX: I think that we have a situation with a divided government that neither side can afford to say never or no way.
MARGARET WARNER: It was left to Congress to pass legislation with specific Medicare changes. But the President will have to sign any bill before it's final. To date, the House and Senate have adopted separate plans that, while different, do share some features. Both would force health care providers to accept smaller payments and would encourage seniors to move into more cost-effective managed care.
But there are controversial differences too--particularly over the following three changes in the Senate bill that weren't included in the House version. The Medicare eligibility age would gradually rise from 65 to 67 for future recipients; more affluent seniors would be required to pay higher premiums; and recipients would be required to pay a home-healthcare fee of $5 a visit.
Last Thursday, House and Senate negotiators began meeting in conference to iron out differences between the two bills. The conferees also have to take the President's views into account, or risk a veto. Last Wednesday, in Madrid, Mr. Clinton indicated he might accept charging wealthy seniors higher premiums, a position known in shorthand as "means testing."
PRESIDENT BILL CLINTON: I've never been opposed to means testing Medicare.
MARGARET WARNER: The President and his aides have made clear he opposes raising the eligibility age, at least in this current package. Last Thursday, the House voted--by a resounding 414 to 14--to go on record against hiking the eligibility age. But advocates fought back. On Friday, a bipartisan group of 12 senators released a letter to the President, saying the eligibility age hike would make the Medicare system "more fair and sound in the future."
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