Is the Medicare Bill Really Almost Done?

It's pretty rare that Robert Pear of the New York Times misses a story on federal social or health policy. He's been on that beat forever, everyone knows him, he's the first person they call when they want to put something out. But his story on progress on the Medicare prescription drug legislation is flatly contradicted by the Washington Post:

Congress Strikes a Tentative Deal on Drug Benefits (NY Times)

Medicare Proposal Outlined (washingtonpost.com)

Pear reports that the House and Senate negotiators have reached a general agreement on some of the core issues, including the basic structure of benefits and premiums, and the policy, which for some reason is called "premium support," under which Medicare services would be open to private-sector competiton. In general, the draft agreement is closer to the outrageous bill passed by the House than the somewhat more responsible bill passed in the Senate.

The Post's Amy Goldstein, though, reports that what really happened is that Bill Thomas, the disagreeable chairman of the House Ways and Means Committee, put down on paper what he thought the final deal should look like, and pissed off everyone, including Senate Republicans, one of whom was heard saying "Hell, no" about the provision on private-sector competition.

So which story is right? It's crazy to bet against Pear, but his story doesn't identify his sources, is vague about specifics, and he's so focused on whether the bill will "attract bipartisan support" that his only quotes come from Senate Democrats, most of whom are unlikely to vote for the bill anyway, and probably won't be needed. Goldstein's sources are anonymous, but she's pretty specific about her evidence that Republicans disagree with the draft and are angry with Thomas, which is what really matters. Plus, Goldstein's story has the virtue of plausibility: Bill Thomas acting in a haughty manner and dividing Republicans -- this is a movie we've seen before.

But even Pear's story offers a long list of issues yet to be resolved:

House and Senate negotiators said these issues were still unresolved:
How to ensure that the cost of drug benefits does not exceed $400 billion over 10 years.

Whether to allow consumers and pharmacies to import drugs from Canada and Europe.

Whether to offer new tax breaks to encourage people to save for medical expenses.

The negotiators are also searching for ways to deter employers from dumping their obligations for retiree health benefits onto Medicare.

Anyone want to try to figure these four things out over the weekend??

Seriously, there's less than one chance in five that Congress will produce any kind of Medicare prescription drug bill at all. And that's not a bad thing, because these are terrible bills. When one possibility is off the table -- forcing pharmaceutical companies to absorb discounted prices to either a government purchaser or individuals -- then we're left with a bill that will simultaneously cost individuals too much, provide only modest benefits -- roughly a 50% discount for someone with $3,000 in drug costs -- and saddle the government with an enormous, unpredictable new long-term obligation.

The conventional wisdom is that it will hurt Bush to fail to produce a Medicare bill. But it is also likely to hurt Bush if seniors ever get the chance to find out just how much they will have to pay and how little they will get, not to mention that they may lose Medicare as they know it.

The only way for the Republicans to gain an advantage from Medicare would be to somehow make it seem as if it's the Democrats who are blocking the bill, a spin that Pear's story helps facilitate. But Ted Kennedy's strong support earlier this year helps belie the claim that Democrats aren't serious about prescription drug coverage. A number of people wondered at the time what Kennedy was doing, and wished he had not conferred his credibility on such a bad bill. But maybe he knew exactly what he was doing. Maybe he knew that the House and Senate Republicans could never produce a compromise, and that by supporting the bill, he could prevent Democrats from getting blamed for its failure. If that was what he was thinking, good for him, because it's exactly what's happening.

Mark Schmitt

10/23/2003

Is the Medicare Bill Really Almost Done?

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