Drug-Cost Riddle Unsolved in Senate

By JANET HOOK

July 31, 2002 12 AM PT

TIMES STAFF WRITER

WASHINGTON — Congressional efforts to create a prescription drug benefit under Medicare appeared headed toward collapse in the Senate on Tuesday, as Democrats faltered in a last-ditch drive to build support for a compromise.

The alternative measure, which would target drug coverage for the poor and those facing high drug costs, is scheduled for a Senate vote today.

Major senior citizens groups, including AARP, are lobbying hard for the proposal. But proponents concede they are unlikely to have the votes to pass it.

If the compromise fails, it will significantly diminish chances that Congress this year will pass legislation to provide drug benefits through Medicare, an idea that politicians of both parties have discussed and promised for years.

Faced with the prospect that Congress will come up empty-handed, lawmakers spent much of Tuesday maneuvering to blame their political opponents for the failure.

“If [Republicans] oppose us on the compromise, we’ll know who supports ... drug coverage and who doesn’t,” said Senate Majority Leader Tom Daschle (D-S.D.).

But Republicans accused Democrats of staging the debate not to produce a law but to frame a political issue for this fall’s campaign.

“The way this was set up was almost designed for failure,” said Sen. Don Nickles (R-Okla.). “They’re a little more interested in playing politics than they are in serious legislating.”

At the least, the Senate is expected today to approve a more modest effort to help people cope with soaring drug costs: a bill to make it easier to get cheaper generic drugs to market. Lawmakers had hoped to approve a Medicare drug benefit as an amendment to that measure.

In other action on the generic drug bill, the Senate voted down an amendment that would have slapped new limits on medical malpractice lawsuit awards, a big setback to President Bush’s plan to overhaul the medical liability system.

The end of the debate on expanding Medicare to cover prescription drugs came into view, ironically, on the 37th anniversary of the establishment of the landmark health insurance program for the elderly. The law’s gap in coverage of prescription drugs has become increasingly glaring over the years, with the development of costly medications to treat chronic diseases.

The issue is a priority for elderly voters, who are a key political constituency. Members of both parties have campaigned for years for the benefit, although Republicans and Democrats take very different approaches.

The GOP-led House already has passed a bill to provide prescription drug coverage for the elderly but to provide the benefits through private-insurance mechanisms. Democrats in both the House and Senate favor a more costly program, which would be government-administered through Medicare.

When the leading alternatives came to a vote in the Senate last week--a $370-billion GOP bill similar to the House’s and a $594-billion Democratic bill--neither garnered enough votes to pass. Under Senate rules, 60 votes are needed to pass any prescription drug bill that costs more than the $300 billion allotted in the congressional budget.

That stalemate sent members of both parties scrambling to see if some middle ground could be found. Most Democrats and a handful of Republicans rallied around a $390-billion alternative targeting benefits to the poor and people facing catastrophic costs.

Sponsored by Sens. Bob Graham (D-Fla.) and Gordon Smith (R-Ore.), the plan would provide complete drug coverage only for Medicare beneficiaries with annual incomes that do not exceed 200% of the poverty line ($23,880 a year for couples).

More-affluent Medicare beneficiaries would qualify for full drug coverage only after their annual out-of-pocket drug expenses exceeded $3,300. Those who don’t fall under the low-income or “catastrophic” coverage would get relief through a discount card, which could save them 20% or more on prescription drugs.

Proponents said it is a good first step that would steer limited resources toward those who need help with prescription costs the most. But Republican critics said it is too much money for too little coverage; they argued that their defeated private-sector plan could provide universal coverage for comparable costs.

Smith, who is facing a tough fight for reelection this year, pleaded with fellow Republicans to support the compromise in a speech Tuesday to the party’s weekly closed-door caucus.

Lobbyists for the elderly weighed in to drum up support, with the president of the powerful AARP enlisted to call members.

But by day’s end, only one other Republican besides Smith publicly embraced the compromise: Sen. Susan Collins (R-Maine), who is also in a competitive fight for reelection this year.

Smith continued to hold out hope of gaining more support, but his spokesman and other allies acknowledged it will be a battle. “It’s obviously going to be tough,” said Chris Matthews, Smith’s press secretary.

The amendment limiting medical malpractice awards was introduced by Sen. Mitch McConnell (R-Ky.) to follow up a proposal Bush made last week in North Carolina. He echoed Bush’s argument that imposing limits on jury awards would deter frivolous lawsuits and save tens of billions of dollars in health-care costs.

The amendment would have limited punitive damages in medical malpractice cases to twice the amount awarded in compensatory damages. It also would cap attorneys’ fees in such cases to 33% of the first $150,000 of an award and 25% of the award on all amounts over $150,000.

Democrats, consumer groups and trial lawyers say the limits would make it harder for patients to hold medical professionals accountable.