Outside editorial: Riding a Trojan Horse

Posted: Wednesday, February 27, 2008

This editorial appeared in the St. Louis Post-Dispatch:

President George W. Bush wants to make the wealthiest seniors - those earning more than $82,000 a year, $164,000 for couples - pay higher premiums for Medicare drug coverage. It sounds like a reasonable idea. It's not.

What Bush proposes is, in fact, a Trojan horse attack designed to weaken support for Medicare, one of the most popular and successful government programs ever created. It follows the script he created in 2005, when he used projected funding shortfalls to campaign for privatizing Social Security.

Under a 2003 law that created the drug benefit, Bush is required to propose cost savings when projections show that 45 percent of Medicare spending will come from general tax revenues instead of trust funds created to support the health insurance program. At present, he says, Medicare is financially unsustainable.

Bush's plan to charge higher premiums for more affluent seniors would save $3.2 billion over five years, the Congressional Budget Office has estimated. That's about $640 million a year, which is a lot, even in Washington. But the government could save almost 17 times that much just by ending overpayments to private insurance companies that sell so-called Medicare Advantage plans.

In terms of quality care, those plans get poorerscores on average than traditional Medicare, yet they cost taxpayers 13 percent more per enrollee. The total savings from paying those plans the same as traditional Medicare would be $54 billion over five years.

But last year, when the House tried to end the overpayments, Bush threatened a veto. He also threatened to veto legislation that would allow the federal government to use its marketing clout to negotiate lower Medicare drug prices, as it now does for veterans and the poor. It's not difficult to understand why.

From the start of the 2000 election cycle to the end of last year, insurance and pharmaceutical groups have contributed nearly $156 million to Republican candidates for federal office, according to the nonpartisan Center for Responsive Politics.

The editorial board opposed the 2003 Medicare drug benefit law. Our concerns included the contradiction between forcing Medicare to make excessive payments to insurance and drug companies and the trigger that demanded benefit cuts.

When Medicare was created in 1965, the biggest group of Americans living in poverty was the elderly. Many seniors had no health insurance at a time in their lives when they were most likely to need it. Both problems were addressed by Medicare.

One reason it's so popular today is that it makes the same basic benefits available to all, regardless of income, at the same cost. Forcing wealthier people to pay more will erode their support for the program and pit their interests against poorer seniors.

There's no question that Medicare's cost will skyrocket in coming years as more baby boomers qualify. But what's happening to Medicare is no different than what's happened to other health care spending. A new projection shows overall health spending will double over the next 10 years.

Bush's Trojan horse attack will only make things tougher for millions of older Americans. Congress should make things tougher for the insurance and drug companies instead.



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