Congress Kills Catastrophic Care Program

Congress voted early today for total repeal of Medicare’s controversial catastrophic care program, a once highly acclaimed expansion of benefits financed by a surtax on senior citizens that proved to be highly unpopular.

A dramatic wave of protest by those subject to the surtax led to Congress’ repudiation of a law that it had approved overwhelmingly in the summer of 1988.

The Senate repealed the law by voice vote early today, bowing to the House, which won a battle of nerves between the two chambers. The House voted four times for total repeal, rejecting repeated Senate proposals to save part of the benefit package.

Late Tuesday night, the House brushed aside, by a vote of 346 to 55, the Senate’s last attempt to preserve a remnant of catastrophic care. The last House vote on the issue was by voice vote and the Senate finally followed suit.

The Senate’s voice vote was a “quiet end to a long and loud controversy,” said the Senate majority leader, George J. Mitchell (D-Me.).

Meantime, the House, by a vote of 272 to 128, approved a $14.7-billion deficit-reduction bill early today that relies on a mixture of real and artificial savings and raises some taxes. The Senate adopted the measure soon after and sent the bill to President Bush, who is expected to sign it into law.

After the votes, Congress began its winter recess.

Sen. John McCain (R-Ariz.), who had led the fight to keep some of the catastrophic care benefits, said that he had mixed feelings about repeal of the program.

The elimination of the surtax is “a victory for the nation’s seniors,” McCain said. “But I am, of course, disappointed that Congress chose to repeal many vital benefits that are extremely important to the health of our nation’s senior citizens.”

He predicted that Congress “will be forced to revisit these issues next year.”

The abolition of catastrophic care marked the first time that Congress has dismantled a major new social program almost immediately after creating it.

The fatal political flaw in the program was a special tax for financing it, to be paid by the 40% of Medicare beneficiaries who pay federal income taxes. The surtax ranged from $22 to a maximum of $800 for individuals and $1,600 for married couples.

The legislation passed 17 months ago provided for the first time that a federal program would be financed solely by its beneficiaries, rather than by the general taxpayers. The 33 million Medicare beneficiaries--people over 65 and disabled people of all ages--bore the full financial burden under the law. The surge of protest against the surtax overwhelmed the appeal of its catastrophic care benefit. The legislation marked the biggest expansion of federal health benefits since Medicare was created in 1965.

Referring to last ditch efforts to save the program, Rep. Henry A. Waxman (D-Los Angeles) declared as jockeying between House and Senate went on: “We’re trying to re-create this catastrophic bill, and we’re only going to make it worse. The only sensible thing is to repeal and come back next year . . . and figure out something the seniors want and can pay for.” The abolition of the tax means the elimination of the benefits, too. The program included:

--Unlimited days of hospital care after the patient paid $560 for the first day in the hospital.

--A ceiling on patients’ personal spending for doctor bills.

--Medicare coverage of prescription drugs for the first time.

--Other benefits, including greater eligibility for skilled nursing care, an expansion of home care services, and Medicare coverage of mammography screening for breast cancer. The elimination of catastrophic care means that hospital coverage will be reduced, and returned to the formula in effect before last year.

Starting Jan. 1, patients would pay $592 for the first day in the hospital and receive the next 59 days free. The charge would be $148 a day for additional days. The catastrophic law provided for unlimited free days after the patient paid for the first day.

Major groups representing the elderly supported Senate efforts to retain some of the benefits included in the original catastrophic care law.

The Senate’s last-ditch effort, backed by the leadership of both parties, would have preserved coverage for long-term hospital stays, and the home care, mammography and other benefits.

“It’s a pretty thin gruel, but it’s our best chance to avoid repeal,” Sen. Lloyd Bentsen (D-Tex.), chairman of the Finance Committee, said before the final House vote.

But the House refused to swallow what was offered and decided that no bill was better than a remnant of the original catastrophic program.

Rep. Pete Stark (D-Oakland), one of the original authors of the legislation, said he had “agonized” before deciding to vote for total repeal and, possibly, a new start on the issue next year.