Drug plan risks senior backlash
Many retirees expect more from new benefit than Washington offers.
At a time when healthcare is among Americans' top concerns, President Bush and Congress are pushing to score a big victory: Giving the elderly $400 billion worth of help to pay for prescription drugs.
It's a vast new benefit for retirees, even as Washington isn't planning anything similar for younger Americans, who also face rising health-insurance costs.
But if policymakers hope to bask in gratitude from America's seniors, they shouldn't be too hasty. The risk of alienating a key voting bloc with a bill that falls well short of expectations is large, judging by polls and interviews with seniors' advocates. That's a key reason this year's push for Medicare reform is so tough.
Call it the Leona Kozien scenario.
She's the angry senior who flung herself across the hood of a Chevy Caprice belonging to a lawmaker who helped draft the last Medicare overhaul, as he attempted to flee protesters at a Chicago senior
citizens center. The backlash from retirees was so serious that Congress was forced to repeal the law in 1989, just a year after it was passed.
"Not only is a [new] backlash possible, it's likely," says Larry Sabato, a political scientist at the University of Virginia. "Seniors want what America probably can't afford. They are only going to be satisfied with a very generous prescription drug bill that would break the bank."
Whether the 1988 scenario will repeat - and whether a Medicare law will even reach Mr. Bush's desk - is unclear. But today's parallels are striking. What sunk the 1988 law was the perception that seniors had more to lose than to gain from the law. While it expanded coverage for drugs and catastrophic care, it imposed new costs on many seniors who already had such coverage. After seniors began to see how the law affected them, Congress was blindsided by the negative response.
President Bush and the GOP-controlled Congress are in a similar bind. Lawmakers on both sides of the aisle have promised for three election cycles support for drug costs. Now, with Republicans controlling the White House and Congress, the pressure is on to keep those promises.
A key problem: Seventy percent of seniors think the changes Congress is considering will either have no effect or make the situation worse, according to one CNN/USA Today/Gallup poll. And 76 percent say that Congress should do more (than current bills provide) to help senior citizens pay for drugs.
"Healthcare is going to be an important issue in the 2004 election, and prescription drugs are at the top of the list, especially for people over 50. If there is no prescription drug bill, look out: Seniors are going to be angry. But if there is a lousy prescription drug bill, they are going to be even angrier," says pollster John Zogby.
In the current negotiations between House and Senate conferees, many key players remember the 1989 debacle.
Still a repeat is possible.
Because of budget constraints, any bill will cover only a portion of the senior drug tab. The Medicare population is expected to spend $1.84 trillion over the next 10 years on prescription drugs, according to the Congressional Budget Office (CBO). Yet, Congress has capped a new drug benefit at $400 billion for the decade.
Another problem is the sheer complexity of the bill. Together, the House and Senate versions stack up to 1,800 pages. Benefits vary from region to region and across income brackets. The House version does not cover individual drug costs between $2,000 and $3,500, while the Senate bill exempts low-income seniors from this "doughnut hole."
"Those currently on the Medicare program like Medicare. What they want is for it to cover their prescription drug costs," says David Certner, director of federal affairs for the AARP, the No. 1 seniors organization. "Whether good or bad, it's going to be a lot more choices and decisions than people had to make before. They are going to be a lot more confused."
One worried senior is Carol Baran, a retiree in Rochester, N.Y. She is caring for a husband diagnosed five years ago with Alzheimer's disease. She wants to make sure they can live together at home as long as possible, but it's forcing some wrenching choices about care, including one drug that costs $400 a month.
"People that have money could pay for that, but there are a lot of us in the middle that fall into the cracks," she says. "If we went under a new government program and later did not qualify, what would there be for people to fall back on? It's scary."
The biggest unknown for many seniors is whether they will lose their own coverage in private plans, provided by their employers or pension plans. The CBO estimates that the passage of either the House or Senate version of the Medicare bill would encourage employers to drop drug coverage for their retirees, affecting 1 in 3 Medicare beneficiaries.
The current House and Senate plans would raise health costs for 3 in 4 Medicare beneficiaries, according a new study released this week by USAction Education Fund, a progressive group.
"The seniors who are likely to be most seriously damaged by the current drug bill are those who have employer-based corporate coverage," says Robert Moffit, director of domestic policy studies at the Heritage Foundation, a conservative think tank. As deputy assistant secretary for legislation at the Department of Health and Human services, he worked with Congress on the 1988 Medicare bill.
"Congress," he says, "ought to be worried about a backlash."