Solvency Became Paramount Concern
Like Social Security, it may be a political third rail, but Senate majorities are risking a ride there. They voted for the most drastic changes in Medicare since it was enacted 32 years ago, challenging the powerhouse senior citizens lobby in a signal of political change.
The Senate wrote the Medicare measures into its version of the massive budget package Congress passed Wednesday. They are not part of the House bill and President Clinton doesn’t favor them being in the current legislation.
So they may not survive in the final budget bill. But the wide, bipartisan Senate support for gradually raising the Medicare age from 65 to 67 in 2027, and for increasing premiums paid by upper-income seniors, breaks barriers that withstood earlier warnings that the system is running out of money.
Based on current projections, it would go broke in 2001.
Sen. Bob Kerrey, D-Neb., who has waged a lonely campaign for entitlement reform, said the need for change overtook the opposition to it. “The facts are very compelling,” he said in a telephone interview. “These kinds of choices are the choices you have to make.”
He headed a commission on entitlement reform that warned 2-1/2 years ago that costs would soar and Medicare would go bankrupt without changes. But the panel couldn’t agree on what to do about the future funding of Medicare and Social Security, so it sent President Clinton and Congress a letter saying that “tough action is needed sooner rather than later.”
There was none until Tuesday and Wednesday when, abruptly, the Senate voted overwhelmingly, and with substantial Democratic as well as Republican support, for income-based premium increases called means testing, setting a course liberals and seniors fear could be a precedent.
They are wary of attempts at such changes in other entitlement programs that pay benefits to individuals, including Social Security, which faces an increasing strain on its finances as retirement rolls soar.
The Social Security age already has been raised, to reach 67 in 2025.
Advocates of the Medicare premium increase at upper incomes said it would affect only one person in 20. They said that should take the political sting out of it.
But Sen. Barbara Mikulski, D-Md., said she believes it is “just a ruse to create the principle of means testing, to get what I call the slippery slope.”
“It just lays the groundwork for additional means testing,” she said before the Senate voted 70-30 to do it. The vote to increase the Medicare age was 62-38. And to require a $5 co-payment for home care visits, it was 59-41.
“Every senior will know about that,” said Sen. Edward M. Kennedy, D-Mass., who opposed all three steps.
The Senate votes surprised even some supporters of the changes.
“We are probably going to lose,” Sen. Dan Coats, R-Ind., had said. “I don’t think we have the political will to do it.”
Kerrey said in debate that the Senate should “resist the political temptation to cast an easy vote” to leave Medicare unchanged for now.
He said afterward that the need to act for solvency overtook the resistance and led to approval of the steps the Senate Finance Committee advocated.
“This sort of grew up within the Finance Committee,” said Sen. John D. Rockefeller IV, D-W.Va., who wanted to wait for a new commission study. “It got its own momentum, and the Finance Committee was acting apart from the rest of the Senate and apart from the rest of America.”
Perhaps so, but the margins were striking. A final Democratic attempt to erase the Medicare changes before the budget passed was rejected Wednesday, 75-25.
Not that the political risk is gone. It was evident in the vote on raising Medicare premiums; four of the six Republicans who voted no are running for new terms in 1998. And only four of the 21 Democrats who voted for that measure are going to be candidates in 1998.
Kerrey said he doesn’t think it will hurt supporters in the next campaign because the steps are to make Medicare sound and solvent. “That’s plenty of cover,” he said. xxxx