Bush airs $198 billion plan for drug coverage

By Anne E. Kornblut, Globe Staff, 9/6/2000

CRANTON, Pa. - Unveiling details of a plan that would radically restructure Medicare, Governor George W. Bush pledged an immediate end to soaring prescription drug costs for senior citizens, staking his claim on a highly charged issue that until yesterday mainly belonged to Vice President Al Gore.

Bush laid out a $198 billion proposal guaranteeing full prescription drug coverage for the poorest families, or any senior earning less than $11,300 a year. For everyone else, the plan would cover part of the premium for private prescription drug insurance, relying on a market-oriented reshaping of Medicare to bring down overall drug costs.

The details of the Bush plan - and there were many - were released amid accusations that the governor of Texas has failed to address substantive issues, and suggested he was trying to project a more serious image to counter Gore's recent rise in the polls. Rather than his usual day of outdoor rallies and sweeping rhetoric, Bush held several intimate meetings, ticking off facts and figures as he read his policy from a prepared text.

''Medicare is a vital program - too vital to be neglected,'' Bush told a group of senior citizens in Allentown, Pa. ''It needs preventative care now to provide quality health care and prescription drug coverage for all our seniors. For eight years, the current administration had this opportunity and has squandered it.''

The announcement marked the first time in days that Bush successfully conveyed his chosen message, following a week of mishaps and an embarrassing incident Monday in which he accidentally broadcast a vulgar insult over the public address system at a Labor Day rally.

The announcement yesterday, though completely devoid of surprise, also confirmed the longstanding conventional wisdom that health care would become a main theme of the presidential campaign.

Democrats firmly believe they have taken the more popular stance on health care in general - and prescription drugs in particular - in part because so many of the nation's 39 million Medicare recipients are desperate for a drug benefit but are wary of changing the system itself. Under the Gore plan, $253 billion would be spent over 10 years on adding a prescription drug benefit to the existing Medicare program.

Yesterday, Gore attacked the Bush plan as targeting too narrow a group of seniors, saying it would cover drug costs for the poorest, but leave middle-income families with only a minimal subsidy. Under the Bush plan, a person who has an income of $14,600 or more would get assistance with 25 percent of the cost of the part of their private insurance premium that covers prescription drugs - in other words, only a fraction of the total cost of the insurance premium, and nothing for the drugs themselves.

''Nearly half of all of those who don't have coverage today wouldn't get coverage under the plan that he's announcing today,'' Gore said. ''The biggest problem is, there's no money to pay for it if you give away all of the surplus in the form of a giant tax cut for the wealthy.''

Bush has long made a five-year, $483 billion tax cut the centerpiece of his campaign. In addition, he would spend $2.3 billion of the $4.3 billion federal budget surplus on shoring up Social Security. The remainder of the surplus would be spent on not only the prescription drug plan he outlined yesterday but also on improving education and rebuilding the military, according to the Bush plan.

Breaking his proposals down even further, Bush said he would devote $110 billion to modernizing the Medicare program over 10 years, moving seniors into the private health care plans of their choice. The plan would be modeled on the Federal Employees Health Care system, in which 9 million federal employees are essentially given a voucher to pick the health care plan of their choice.

''Nothing like a little competition, by the way, to create excellence in the system,'' Bush said.

In addition, Bush would direct $48 billion toward individual states to create an ''immediate helping hand'' program - one in which states would subsidize prescription drugs for the poorest seniors until the Medicare overhaul was complete.

But the ''helping hand'' would not be mandatory, and some Democrats yesterday questioned whether a state-by-state program could be implemented as swiftly as Bush suggested. Today, only 23 states have mechanisms for providing prescription drug coverage.

The final portion of Bush's Medicare plan would devote $40.3 billion to restoring Medicare cuts that resulted from the Balanced Budget Act of 1997, rounding out what Bush described as a plan based on ''flexibility, options, and choice.''

''These are the cruel choices some seniors face: heat or medicine; food or pills. In a wealthy nation, this is a scandal,'' Bush said. ''In a compassionate nation, it is a call to action.''

As expected, the Bush plan closely mirrored an earlier Senate proposal to overhaul Medicare, a controversial package sponsored by Senators John B. Breaux, a Louisiana Democrat, and Bill Frist, a Tennessee Republican. The original Breaux-Frist plan was scrapped in favor of a more limited proposal, but Bush returned to the original blueprint, which deals with revising Medicare instead of just providing prescription drugs. That Bush would rely on such a familiar target delighted Democrats, who pounced immediately on the plan. Senator Edward M. Kennedy, Democrat of Massachusetts, even took to the Senate floor to deplore the Bush proposal, saying: ''It is a program only a drug company executive could love.''