By Raja Mishra, Globe Staff, 10/31/2000

Second in a weeklong series reviewing the major issues of the presidential campaign.

Imagine if the world's largest health insurance company didn't offer its members prescription drug coverage, if, every month, millions of people had to fend for themselves to buy depression or cholesterol or ulcer medications.

That's Medicare. About 1 in 7 Americans, most of them elderly, have faced this for decades.

That is why the two presidential candidates have competed so fiercely on the issue. George W. Bush's solution calls for turning over some of government-run Medicare to private health insurance companies, which would devise and market drug coverage.

Al Gore would keep all of Medicare within the government but spend more to help pay for drugs.

The approaches grow out of their core political philosophies. Bush prefers to lean on the private market whenever possible. Gore believes that government is the safest option for certain services.

Medicare was created in 1965. Workers pay 1.45 percent of their wages to fund the program. Before Medicare, seniors relied mostly on relatives and charity to pay for their health care expenses. Now there is comprehensive health care.

That is, if you can call health care without prescription drug coverage comprehensive. Most doctors would say you cannot.

The pharmaceutical sciences have made enormous leaps in the past two decades. As most people age, they develop chronic ailments such as arthritis, digestion difficulties, heart problems, and brittle bones, to name a few. Untreated, they often cause great discomfort. They can make it hard to function. They can hasten death.

Prescription drugs can keep many conditions in check or even prevent them from developing. In the past decade they have become an ever-more-integral part of medicine.

Bush's prescription drug solution is based on changing Medicare as a whole. He would break the government monopoly on health care. Private companies would compete to insure the elderly. Most would include prescription drug coverage in their packages.

Seniors would buy health care just like everyone else; they would have to pay monthly premiums like everyone else. But Bush's plan would give them help: 25 percent of their premiums would be paid by Uncle Sam. All costs over $6,000 in one year would be paid by the government. Poor seniors would get free care. Also, all seniors would have the option of staying in government-run Medicare.

The Bush proposal would cost $110 billion over a decade. The advantage is choice: healthy seniors could get inexpensive plans, sick ones could get expensive plans. But it is hard to say how much their premiums would be. They could be costly enough to make it almost unaffordable for some seniors on fixed incomes who are not so impoverished as to qualify for the aid Bush gives to the very poor. Moreover, the private market can be tumultuous for the elderly. Numerous HMOs that once covered elderly found it too expensive and dropped them, forcing the seniors to scramble for new coverage.

Gore's plan extends Medicare to cover drugs. He would spend $253 billion over 10 years to do this. In return, seniors would have half their drug costs paid by the government. If a particular drug costs $50 per month, Medicare would kick in $25.

If a senior spends $5,000 on drugs in less than a year, the government would pay all costs for the rest of the year. Poor seniors would get even more help, and impoverished seniors would be covered for free.

But Gore would not let private health insurance companies into the picture. He believes that health care is too important to trust to the ups-and-downs of the market.

Still, the market has the potential to offer seniors more choice, as it does with most other consumer products. For instance, a healthy senior, under Bush's plan, could save money by purchasing less expensive insurance that does not cover a lot of special medical care. Or a senior with eye problems could purchase a plan that offers extensive eye care. Under Gore's plan, they would be limited to a few government-regulated plans.

The differences between the candidates here is significant, but neither questions Medicare's fundamental premise: The government should require working people to pay for the health care of the elderly.

Bush would introduce large-scale private competition into the system for the first time. Gore would continue Medicare as is, only bigger. Both would offer prescription drug coverage, bringing senior health care in step with most others who have health care coverage.