Senator Defends Medicare Reform Measure

Published August 1, 2003

Senator Chuck Grassley (R-Iowa), chairman of the Senate Finance Committee, told USA Today the Senate’s Medicare reform measure “targets the poorest and the sickest. It gets the most bang for the buck. It keeps traditional Medicare intact. It injects competition to improve benefits and control costs.”

Grassley defended even the drug coverage gap, saying “Congress approved $400 billion over 10 years for a Medicare drug benefit. It’s a lot of money, yet it doesn’t buy blanket coverage. Even with older Americans sharing the costs, this amount stretched only so far. Over the next 10 years, older Americans will spend $1.8 trillion on prescription drugs. Because of this huge expense, our bill targets the most help to the poorest, sickest seniors. And the coverage gap isn’t likely to affect the vast majority. I wish it didn’t affect anyone at all, but the budget limit is the law.”

In an effort to control costs, the Senator said, “we promote the sale of generic drugs and inject competition into Medicare. We worked hand in glove with the non-partisan Congressional Budget Office to structure our bill to contain costs. The bill requires private plans to compete for Medicare’s business in each region. Private companies have an incentive to keep costs down. The CBO says our structure will work. Its people are the experts, and they have no political ax to grind.”

As for the delayed start of the drug program, Grassley explains, “We’re adding the biggest benefit to Medicare in its history. According to government agency experts, it’s logistically impossible to set up this huge new program and enroll millions of people before the end of 2005.”

Medicare required structural change, Grassley said, outlining how that is accomplished in the Senate proposal. “We included several substantial structural improvements. For those who choose the new Medicare option with drug coverage, we get rid of duplicative, irrational deductibles. Traditional Medicare hospital coverage has a deductible for each illness–$840 in 2003. A beneficiary admitted to the hospital multiple times ends up paying this deductible more than once a year.

“There’s also an annual deductible for Medicare physicians’ coverage,” says Grassley. “That’s expensive and confusing. Under the new Medicare option, people will pay one deductible for all services, just like most other Americans.”

Conrad F. Meier is managing editor of Health Care News. His email address is [email protected].