Smaller-Scale Prescription Drug Plan Gains Support of AARP

A scaled-back proposal for a Medicare prescription drug benefit gained momentum Friday, picking up support from the nation’s largest lobbying group for the elderly.

“We’re going to support it,” said William Novelli, executive director and CEO of AARP. “We think this is the best we can get for our members. It’s a framework to go back and work on.”

The compromise plan would help mostly the low-income elderly or those who have already spent a significant amount on medicine.

Sen. Edward M. Kennedy (D-Mass.), chairman of the Senate health committee, conceded that the measure is gathering steam even though a group of senators continues to try to develop a more comprehensive plan that would provide coverage for all senior citizens.

“There are those that believe we need a down payment of some form or shape even if it has to be a catastrophic proposal,” Kennedy said. “Certainly, I think at this point, the majority of Democratic members feel that way.”

But Sen. Olympia J. Snowe (R-Maine), who is working on a more expansive plan, said lawmakers were giving in too soon. “There’s no reason to go with a lesser plan. It’s a cop-out.” She added that she believes a more comprehensive plan still is “doable.”

Kennedy predicted that the scaled-back plan would get bipartisan support. Final details were being worked out by Sens. Bob Graham (D-Fla.) and Gordon Smith (R-Ore.).

“This new bipartisan plan will help all seniors buy prescription drugs, but it will give the greatest help to the most vulnerable older Americans, those with lower incomes and with the most serious health problems,” Graham said.

“This is a good, focused plan that all of us should be able to support,” Smith said.

The compromise is a retreat from Democrats’ longtime push for a comprehensive benefit that covers all senior citizens. But it also omits Republicans’ push to have a plan that relies on private insurers. The compromise calls for a benefit administered through Medicare, according to one Senate Democratic aide, who spoke on the condition of anonymity.

The proposal would cost an estimated $400 billion over 10 years and would cover about half of the 40 million senior citizens on Medicare, Kennedy said. That’s substantially smaller than the $594-billion plan Democrats unsuccessfully brought to the House floor this week. That plan, as well as a $370-billion proposal offered by a coalition of Republicans, a Democrat and the Senate’s lone independent, failed to get the 60 votes necessary to pass.

A group of Republican lawmakers offered a $160-billion plan that also was targeted to the poorest seniors and those with high drug costs, but that plan also failed.

The compromise proposal is substantially different from that measure.

Seniors with incomes below 150% of the federal poverty level (about $18,000 annually for a family of two) would get full coverage with nominal co-payments, according to Senate Democratic aides. All other seniors would receive government help of 5% of the cost of each prescription drug, although aides said additional discounts could be provided through group purchasing power.

More government help would kick in once a senior citizen reached $4,000 in drug costs. At that point, there would be a $10 co-payment on each prescription drug and the government would pick up the remaining costs.

All but low-income beneficiaries would pay a $25 annual enrollment fee, but there would be no monthly premiums or deductibles.

The Medicare proposal would be offered as an amendment to a bill that eases access to generic drugs and is being used for an overall debate on prescription drugs.