The Wall Street Journal-20080216-Politics - Economics- Bush-s Medicare Plan Likely to Ignite Partisan Fight

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Politics & Economics: Bush's Medicare Plan Likely to Ignite Partisan Fight

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WASHINGTON -- President Bush sent legislation to Congress aimed at reining in Medicare costs. At the top of his list: charging wealthier beneficiaries more for their prescription-drug coverage.

But Democrats said the proposal wouldn't get far, and Sen. Edward Kennedy (D., Mass.) called it "dead on arrival."

Bush administration health officials unveiled proposals Friday that are designed to reduce the portion of Medicare spending that comes from general revenues, as required under a 2003 law that also spelled out procedures meant to force the Democratic-controlled Congress to consider the proposals this year.

The ideas are likely to touch off an election-year fight between Democrats and Republicans about how to deal with Medicare's increasing costs. Rep. John Dingell (D., Mich.) said the proposal "shows us exactly where Republicans stand when it comes to helping seniors and people with disabilities. The president's idea for 'improving' the program is to stick the beneficiaries with more of the bill."

Many Republicans backed Mr. Bush's plan, saying Medicare growth is endangering the nation's fiscal health. "We cannot delay action on entitlement reform any longer," said Sen. Judd Gregg of New Hampshire, the Senate Budget Committee's top Republican. "There is no denying that this crisis is on our doorstep." House Minority Leader John Boehner of Ohio said he hoped Democrats would "work with Republicans to begin making these important reforms."

The Bush proposal calls for savings of $900 million in 2013, or nearly $3.2 billion over the five years starting then, by increasing the drug-insurance premiums paid by Medicare beneficiaries with incomes greater than $82,000, or $164,000 for married couples. The bill also would give the Department of Health and Human Services secretary authority to implement a nationwide system for electronic- health records, provide cost and quality data about health-care providers to Medicare beneficiaries, and design a way to link government payment of providers to their efficiency and quality.

In addition, the legislation would restrict damages in medical- malpractice lawsuits, which HHS Secretary Michael Leavitt said would reduce duplicative tests and other steps physicians may take to protect themselves. Mr. Bush has proposed many of the same ideas in recent years.

Sen. Max Baucus, a Montana Democrat who chairs a committee that oversees Medicare, said the medical-liability changes are "not going to get any more traction than they have before." He said raising Medicare drug premiums for upper-income people is "an attractive option" to help pay for other priorities, but said it is a "major change that should only be considered in a broader review of the benefit."

The legislation is a response to a provision included in the Medicare drug-benefit law passed in 2003. Under that law, a warning must be issued if Medicare's trustees predict for two years in a row that the portion of its spending coming from general revenues will exceed 45% within a seven-year window. That prediction was made for the second consecutive time last year. The 2003 law calls for the legislation to be introduced in the House and Senate, making battles possible on the floor this year. Democrats, who reject the warning as constructed, said they still are considering how to proceed.