- The Washington Times - Friday, November 3, 2006

The Next Congress

Fifth of five parts

Democrats would use a new majority in Congress next year to highlight contentious health care issues such as high prescription-drug prices and funding for stem-cell research. Republicans, meanwhile, would push for an expansion of consumer-driven health care to reduce U.S. reliance on entitlement programs.

Democrats would face stiff opposition from the Bush administration on their health care agenda, which is why many specialists predict that even if the party wins the majority in Congress in next week’s midterm elections, it will use its newfound control to define a health care agenda for the 2008 presidential election.

Gaining a majority would offer Democrats a chance to push their health care priorities at a level they haven’t been able to since President Clinton occupied the White House.

“If the Democrats take one or both houses of Congress, the prospects of significant policy changes seem fairly remote,” said Scott Lilly, senior fellow at the Center for American Progress, a Democrat-oriented research organization. “That does not mean the next two years will not be an important period. There is the possibility of a rich debate over policy options that the country has not had in more than half a decade — in particular on health care.”

Democrats have an outside chance of taking complete control of Congress, but a better chance of winning one chamber, and in this series, The Washington Times has looked at how such a transfer of power will affect U.S. policy and politics.

Big plans

At the top of the Democrats’ health care agenda is giving the federal government the ability to negotiate Medicare drug prices directly with the pharmaceutical companies.

“First, Democrats would repeal the ban on allowing Medicare to use the bargaining power of its 43 million beneficiaries to negotiate lower drug prices,” said Jim Manley, spokesman for Senate Minority Leader Harry Reid of Nevada.

House Minority Leader Nancy Pelosi of California has made it clear in recent weeks that the Democrats would make negotiating Medicare drug prices a high priority. Medicare is the federal health insurance program for seniors.

A Democratic majority also would focus on expanding health insurance for children and stem-cell research.

If Republicans retain their majority in Congress, they would push to improve the private health care system through an expansion of health savings accounts and tax deductions for people in private health plans.

“Republicans will continue to encourage the kinds of reforms that use public money to expand private health insurance,” said John Goodman, president for the National Center for Policy Analysis, a Republican strategy firm. “The Democrats are going in the opposite direction.”

Specialists agree that moving health care legislation — never an easy task — would be more difficult in a tightly divided Congress. And Democrats are aware that efforts to turn any of their health care priorities into law probably would be blocked by President Bush.

“I think the president’s veto pen would certainly get a workout,” said Joe Antos, health care policy specialist at the American Enterprise Institute. “But they know that and are looking to 2008.”

Democrats are welcoming the opportunity to showcase health care issues that they say have not been given sufficient attention by the current Republican Congress.

“We are not going to blow in and push an overly aggressive agenda that has dim prospects because of the president’s veto,” said a House Democrat aide, who, citing office policy, spoke on the condition of anonymity. “We will, however, make it clear that we have been locked out for the last six years and we have an agenda.”

A new prescription

The most visible confrontation between the parties is forming around the Democrats’ push to require the government to use its negotiating power to lower prescription-drug costs for Medicare patients.

The 2003 Medicare law prohibits the government from negotiating with companies to lower the price of drugs for beneficiaries. The drug program has been criticized by Democrats, who say pharmaceutical companies are profiting at the expense of America’s seniors.

Separate deals with every private plan in the drug benefit is highly unlikely. Instead, Democrats hope to set up a single drug plan under Medicare that allows the government to negotiate prices.

“That’s how you get at negotiations. Not with the private plans but with a Medicare plan option,” the Democratic aide said. “We have a plan to do that.”

Democrats would use the savings from lowered prices to close the coverage gap in the drug benefit. Sometimes referred to as the doughnut hole, annual coverage stops once drug costs reach $2,250. Coverage resumes when costs hit $5,100.

Republicans argue that prescription-drug plans are competing with each other to serve Medicare beneficiaries and thereby are lowering drug costs.

“We already have negotiations and drug prices are lower,” said Sen. Charles E. Grassley, Iowa Republican and chairman of the Finance Committee, which has oversight over the Medicare program.

Rep. Jim McCrery, a long-standing member of the Ways and Means Committee, which oversees Medicare policy in the House, says price negotiations will not solve Medicare’s financial problems.

“There would still be a massive deficit even if we had negotiations,” said Mr. McCrery, Louisiana Republican.

Democrats also are eyeing reimportation of low-cost drugs through countries such as Canada.

In the Senate, many Republicans, including Mr. Grassley, have supported reimporting drugs to lower prices. And an amendment to an appropriations bill that would loosen the restrictions was approved in the Senate.

“It is more likely the next Congress will pass a reimportation bill than a negotiation bill,” Mr. Antos said. “Passing a negotiations bill would be admitting defeat for the Republicans on the Medicare drug benefit.”

Giving insurance

Reaching America’s growing number of uninsured residents will be a top priority for both parties next year.

Small employers are increasingly dropping employee health benefits as premiums rise. Thus, the number of uninsured people has risen steadily, reaching a record high 46 million in 2004.

“Our primary challenge next year will be the uninsured,” said Rep. Nancy L. Johnson, Connecticut Republican and chairman of the House Ways and Means health subcommittee.

Republicans are pushing the expansion of consumer-driven programs such as health savings accounts, which were introduced in 2003 and allow workers to put their own money into tax-deferred savings accounts.

They want to allow workers to contribute more pre-tax money to the savings accounts to shift the burden off employers.

“Solving the problem of the uninsured should be done in the context of the private health care system, not by expanding Medicare. Health care savings accounts represent the best example of moving toward a better, more efficient health care system,” Mr. McCrery said. “If we maintain control, we are going to enhance that product in the market.”

Mr. Grassley agreed, saying an expansion of health savings accounts could pass in the Senate.

But Democrats remain opposed to relying on the accounts, which often come with high deductibles.

“There will be a huge fight from us on expanding health savings accounts,” a House Democrat aide said.

Instead, Democrats would build on Medicare and Medicaid, the federal health program for the poor, and favor lowering the age for Medicare eligibility.

Protecting the children

The State Children’s Health Insurance Program must be re-authorized in the next Congress. Both parties say the program is essential to reducing the number of uninsured.

The program, which covers about 6.1 million children, has reduced the number of uninsured children from nearly 11 million in 1997, when the program was created, to 8.3 million last year. Children up to the age of 19 in families that earn less than $36,200 a year are generally eligible for the program.

“This will be the most important battleground next year because the poster child on this issue is actually a child,” Mr. Antos said.

Democrats are likely to push for increased funding and making the program a full-scale entitlement.

“Democrats see a real opportunity to take the next step toward covering all kids,” Mr. Manley said.

Republicans, on the other hand, want to ensure that states are using the money on children rather adults, who should be covered through Medicaid, while giving states more freedom to use the federal money to get families into private health care.

“I think Republicans will want to keep the intent of the program intact, and that is covering children,” a House Republican aide said. “We have wandered away from that.”

A new debate

With additional seats in Congress, Democrats will try to capitalize on the stem-cell debate. Once an issue that Republicans relied on, Democrats are painting opposition to stem-cell research funding as out of the mainstream.

Democrats are using the issue against Republicans in 20 House, Senate and gubernatorial races across the country.

“Our goal would be to enact the stem-cell bill strongly supported by the American public,” said Brendan Daly, a spokesman for Mrs. Pelosi. “It is crucial that America keeps its No. 1 place in the world in the development of medical cures.”

Mr. Bush vetoed a bill that would have permitted federal funding for experimentation with stem cells from donated embryos created for fertility treatments.

In the Senate, where there is strong support for stem-cell research, the Democrats would bring up the same bill that passed Congress last year, Mr. Manley said. Adding a Democrat-controlled House would give the bill a potential majority to override a veto.

“The president has drawn a moral line that said that taxpayer dollars should not support research that destroys human embryos. He will continue to strongly support policies that help us achieve scientific progress while also living up to our ethical responsibilities,” said Emily Lawrimore, a White House spokeswoman.

Adding to the Democrats’ momentum on stem-cell research is the Republican split on the issue. Prominent Republicans such as Sen. Orrin G. Hatch of Utah and California Gov. Arnold Schwarzenegger support such research.

Republicans opposed to stem-cell research are targets for Democrats in the midterm elections. The issue has become a central focus in the Maryland Senate race between Democratic Rep. Benjamin L. Cardin Jr. and Republican Lt. Gov. Michael S. Steele. Sen. Jim Talent, Missouri Republican, is taking heavy criticism for his opposition to a state ballot initiative that would allow such research.

“It is a high-profile issue that could be turned against Republicans in the midterm elections, and if the Democrats get Congress, it will be an issue the president will once again have to deal with,” Mr. Goodman said.

Lessons learned

Regardless of the result of the midterm elections, Republicans and Democrats will take away lessons that will help shape their ideologies.

For Republicans, the near certainty of losing seats in both the Senate and House could force the party to look to the past for answers.

“There will be a growing number of Republicans that will argue in the postelection debate that walking away from the principles that defined the party for so many years will hurt them more in these elections than any scandal,” said Michael Franc, vice president of government relations at the conservative-oriented Heritage Foundation.

High federal spending under the Republican-controlled Congress has led Americans to question whether the party is the standard-bearer for limited government, Mr. Franc said.

The Democrats, who are likely to fare better in this year’s races than they have in more than a decade, could lead to a more moderate than liberal Democratic Party.

“If the lesson learned by the Democrats is don’t be afraid of the big tent and they bring in more moderates, it could be a changed party,” Mr. Franc said. “They could get a numerical majority rather than an ideological majority.”

Part I

Democratic majority ready to go to war over Iraq

Part II

Democrats wait in the wings with subpoenas

Part III

Specter of tax man haunts Democrats

Part IV

Bush may find an ally on immigration


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