Taking a giant step toward its goal of producing a balanced budget in seven years, the GOP-controlled House approved a Medicare bill Thursday that would vastly reshape the 30-year-old health insurance program for older Americans.
The complex legislation - debated and passed without any public hearings - would yield $270 billion in savings by 2002, largely by curtailing payments to doctors and hospitals, increasing out-of-pocket payments for beneficiaries and channeling senior citizens into less expensive managed-care systems.
House Speaker Newt Gingrich, R-Ga., called the vote “a big step in the right direction.” Even so, the plan faces many obstacles in the weeks ahead. The debate now shifts to the Senate, where it will run up against an array of powerful special interests who have chosen to make their fight in that more deliberative body.
The plan also faces a veto threat that President Clinton renewed even before the House vote.
“I will not let you destroy Medicare, and I will veto this bill,” Clinton said at a White House news conference. “I have to do that to protect the people of the United States and to protect the integrity of this program.”
Clinton has proposed $124 billion in Medicare cuts over 10 years.
The bill was approved on a largely party-line vote of 231-201, with all but six Republicans supporting it and all but four Democrats voting against it.
Republican Reps. George Nethercutt of Washington and Helen Chenoweth of Idaho both voted with their party Thursday to rein in Medicare spending.
“One of the major factors in last November’s electoral sweep was that Americans want representatives who aren’t afraid to tackle the tough issues,” Chenoweth told the House Wednesday night. “With our Medicare preservation plan, we have shown that we are willing to do exactly that.”
Nethercutt stressed that the plan offers choices.
“This legislation keeps Medicare from going broke,” he said. “It gives seniors the ability to choose from a wide range of options best suited to their individual needs. If not satisfied with their choice, seniors may choose to return to traditional Medicare.”
Republicans predicted the plan would extend the solvency of Medicare’s hospital trust fund until 2010 - a claim disputed by Clinton administration officials, who argue the GOP plan would extend the fund’s life only to 2006.
Democrats are expected to use the fact that Republicans did not hold public hearings on the proposal as Democrats press their case when the Medicare fight moves to the Senate.
Led by lobbyists for hospitals, nurses and the elderly, many organizations have been husbanding ammunition for the battle in the upper chamber - where some moderate Republicans are known to have reservations about the deep cuts projected for Medicare’s spending growth rate.
Before passing the Medicare Preservation Act, the House rejected a Democratic alternative that would have cut $90 billion from the projected growth in spending over 10 years.
To counter Democratic charges that much of the GOP’s projected Medicare savings are intended to pay for a $245 billion tax cut, House Republicans incorporated into their bill a “lockbox” provision that bars any of the savings from the Part B doctors insurance fund from being used for the proposed tax cut. Earlier, the Senate Finance Committee had embraced a similar provision in the Senate GOP’s Medicare bill.
Even so, Senate Minority Leader Tom Daschle, D-S.D., accused the Republicans of “raiding Medicare and Medicaid to dole out huge new tax breaks for the wealthiest individuals and corporations in the country.”
The bill directly would affect bene ficiaries by:
Nearly doubling monthly premiums for the voluntary Part B doctor insurance. Those premiums, now $46.10, would rise to about $90 by the year 2002. The projected monthly premium would be $54 in 1996, $58 in 1997, $63 in 1998, $69 in 1999, $77 in 2000 and $84 in 2001. The Senate bill, approved by the Finance Committee, has a similar schedule.
Requiring an additional Part B premium from single beneficiaries with annual incomes above $75,000 and couples above $125,000. The added payments also would be phased in over seven years and would be assessed on a sliding scale, with those in higher income brackets paying higher premiums. In 2002, a single person with an income of $100,000 or a couple with an income of $175,000 would pay the full amount - a total of about $120 a month.
MEMO: This sidebar appeared with the story: HOW THEY VOTED Here’s how Northwest lawmakers voted on the Medicare overhaul: Idaho - Republicans Helen Chenoweth and Mike Crapo voted “yes.” Washington - Republicans Jennifer Dunn, Doc Hastings, Jack Metcalf, George Nethercutt, Linda Smith, Randy Tate and Rick White voted “yes.” Democrats Norm Dicks and Jim McDermott voted “no.”