AARP Declaring War on GOP Medicare Plan : Budget: Advertising, mailing blitz is to begin today against Republicans' proposal to trim spending growth by $270 billion within seven years.


After holding its fire all year, the nation's powerful seniors lobby is declaring war on the GOP's plan to overhaul Medicare, heralding a titanic fight over the future of the medical insurance program for America's 37 million elderly.

In a nationwide advertising and mailing blitz set to begin today, the American Assn. of Retired Persons plans an all-out assault on the Republican plan to reduce Medicare spending by $270 billion by the year 2002.

"We think $270 billion is too much and seven years is too fast," one top AARP official said Monday.

Precise details of AARP's campaign were not immediately available, in part because the group on Monday afternoon was still buying newspaper and broadcast ads around the country. "Everything is still in production," the AARP official said.

The high-profile drive also will feature mass mailings of "legislative alerts" to millions of AARP's most active members.

"It will be [war]," declared another senior AARP official.

The campaign makes the 30-million-member AARP the first major lobbying organization to openly fight congressional Republicans, who until now have kept the powerful medical interest groups at bay on the issue of Medicare reform

A looming question is whether insurers, doctors and hospitals will follow AARP's lead. They all are making their own final calculations on the pros and cons of the Republican Medicare agenda--and soon must decide whether to support or oppose it.

Although these interest groups like significant features of the GOP Medicare proposals, each also has some serious problems with other parts of those plans.

The dilemma faced by such organizations is no accident.

All year long, leaders of the Republican majority in Congress have played hardball with these groups, well aware that their howls of protest last year played a major role in bringing down the President's health care plan.

To keep the groups publicly silent, the GOP has used both the carrot and the stick--promising them "sweeteners" while threatening to take them away if the groups wander off the reservation.

Hospitals, for instance, face a loss of $75 billion or more in Medicare funds over seven years--"a real cut" that they say would drive some hospitals out of business. But the industry is delighted that the GOP proposals would enable hospitals easily to form their own "provider-sponsored networks," thus bypassing insurance companies and HMOs altogether.

At the same time, physicians are thrilled with a provision that would limit payments to victims of medical malpractice. But the doctors are deeply disturbed by other provisions that would severely limit their Medicare payments.

"We have legitimate concerns, but I don't see that [launching a public fight against the GOP proposals] in the cards today or tomorrow," an official of the American Medical Assn. said Monday. "It's hard to say what's coming up."

Some of the interest groups, hedging their bets, already have prepared attack ads that are sitting on the shelves, awaiting a call to arms.

"We do have the ads--ready to go--if things deteriorate," a spokesman for one such group, the American Hospital Assn., confirmed Monday. "But at the moment we're still negotiating."

Republicans in Congress are pushing similar bills in both the House and Senate that would cut growth in Medicare spending by $270 billion over seven years, largely by reducing payments to providers.

Democrats in Congress have countered with a proposal to produce $89 billion in savings by 2002. President Clinton's proposal would cut spending by $124 billion over 10 years.

All parties agree on the need to overhaul Medicare because the program's hospital trust fund is projected to run out of money by 2002. But Democrats say that the GOP spending cut of $270 billion would be too drastic--and is designed to pay for a $245-billion tax cut for the well-to-do. Republicans deny any connection between their Medicare and tax-cut proposals.

Also on Monday, the House Ways and Means Committee, slowed by partisan wrangling, began work on the 400-page bill proposed by the House Republican leadership to overhaul Medicare.

Democrats alternated their denunciations of the bill with intricate questions about its details.

An angry Rep. Sam Gibbons of Florida, the ranking Democratic member of the committee, denounced the legislation as a "scam" and was rebuked repeatedly by the chairman, Rep. Bill Archer (R-Tex.). "I have no apology for being intemperate if I'm protecting the interests of 40 million people," Gibbons said.

Consideration of the bill was delayed for an hour at the start of Monday's session while Gibbons insisted on an official reading of the legislation, a formality normally waived.

After Gibbons asked the bulk of the questions, Archer criticized him for going over "ground already plowed."

The intensity of the debate reflected the deep philosophical divisions as the Republican majority prepares to approve the most drastic changes in Medicare since the creation of the program 30 years ago. The GOP hopes to make some of the $270 billion in savings by encouraging millions of Medicare beneficiaries to go into health maintenance organizations and other forms of managed care.

The bulk of the savings, at least $145 billion, according to a Congressional Budget Office analysis released Monday, would come from restraints in payments to doctors, hospitals, home health agencies and other providers.

Archer offered a substitute version of the bill on Monday, including some key changes from the original version, notably a "lockbox" provision saying that none of the Medicare savings can be used to help pay for the tax relief promised by the GOP.

GOP leaders hope to complete work on the Medicare legislation by Wednesday. It is being prepared by two panels, Ways and Means and the House Commerce Committee. The Senate Finance Committee has completed work on its version of the legislation.

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