- The Washington Times - Sunday, December 7, 2003

Medicare has finally reached the intersection of needed change and the momentum to make it happen. With a stroke of his pen today, the president will sign into history a law that will positively affect seniors while protecting the future of their children and grandchildren.

Medicare has been good for seniors, but it hasn’t grown to meet their needs or integrated the spectacular medical breakthroughs that have occurred since Medicare’s inception nearly 40 years ago. And probably most concerning, it’s financing and promise is not secure.

Recently, the alarm bells have grown louder. This year the Social Security and Medicare Trustees reported the Medicare Trust Fund will soon be spending more than it collects. The General Accounting Office has also warned that without restructuring, Medicare won’t be able to support its own weight. These sobering assessments were made of Medicare as it currently operates — in the absence of vital improvements for seniors’ health or the addition of a costly drug benefit.

Congress’ mission was to craft a solution that would make Medicare modern and sustainable. These goals may appear to contradict each other, but they do not.

In the 21st century, it is absurd that seniors do not have a drug benefit, preventive coverage and disease management as part of their national health care program. It’s penny wise and pound foolish. Preventive care extends and improves the quality of life. It also is cheaper to provide preventive medicine than to perform invasive procedures.

Our bipartisan agreement adds a drug benefit to Medicare, and incorporates chronic care management to help seniors live healthier.

The drug benefit expands private sector approaches to control spending. It doesn’t replicate the past by relying on government bureaucracy that has failed to keep costs in check. This is the first real reform to the historic command and control model of Medicare.

Preventive care and a prescription drug benefit, though crucial, are not enough to reverse the perilous financial footing of Medicare. To sustain Medicare’s health, this agreement reaffirms seniors’ own stake in their health care costs by realigning the intended cost-sharing between seniors and taxpayers. For instance, wealthier seniors will be asked to pay a higher premium for doctor visits. This is a prudent step that will help stabilize Medicare.

Next, the new law will give seniors more choices in how their health care is delivered. Some seniors may prefer traditional Medicare. If the segmented delivery of hospital care, doctor visits and prescription drugs works for seniors, they can keep what they have today.

However, many Baby Boomers and new arrivals to Medicare might prefer an integrated approach to health care. These younger seniors have more experience in the health-care market and have benefited from choosing a plan that best fits their specific health needs. This agreement makes available a new, regional preferred provider option (PPO).

As a result, choices will abound and competition will ensue. Senior consumers will seek the best price for the highest quality care. This will result in savings while driving down costs borne by American taxpayers.

Medicare+Choice worked successfully in some urban areas, and the agreement takes steps to stabilize and strengthen this option for seniors. However, new regional plans will be stable and available in suburban and rural areas of America that lack heavy concentrations of health-care providers and patients.

As part of a demonstration project in 2010, government-run Medicare will compete directly with integrated private health plans. This test will be operated in six demonstration sites nationwide over a six-year period. It is timed to provide real information and real answers to a problem we will likely face when Baby Boomers retire and Medicare spending soaks up more and more of the federal budget.

That is why this agreement also contains a strong cost containment mechanism that will be triggered when general fund revenue constitutes more than 45 percent of Medicare spending. When the stark choices faced by lawmakers in the future are tax increases, benefit cuts or expanding the successful demonstration of choice and competition nationwide, I believe the policy and political choice will be clear.

In this agreement, there was also a desire to creatively augment Medicare for the next generation. This bill will equip 140 million hard-working taxpayers that aren’t yet 65 with a new opportunity for health security and self-reliance. New Health Savings Accounts will allow working-age Americans to take personal responsibility for health costs both now and in their golden years. Workers can contribute tax-free, build assets tax-free and use those dollars for health care needs tax-free. This is revolutionary change.

Our comprehensive Medicare agreement relies on the principles of choice, quality, security and affordability. In our pursuit to preserve Medicare’s promise to future generations, Congress took on tough issues that will result in significantly better health care for seniors, but at a long-term price their taxpaying children can afford.

Historic action doesn’t just happen. It is the result of focused endeavors. It represents years of groundwork and reflects a responsibility to current and future generations. Today we deliver good Medicare policy for Americans young and old.

Bill Thomas, a California Republican, is chairman of the House Ways and Means Committee.

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