Medicare

Sunday, November 19, 2006

Party leaders said they are determined to try to lower the prices older Americans pay for prescription medicine under the drug benefit that became part of Medicare this year.

The Democrats' central strategy is to change the 2003 law that created the new benefit so that the government -- not individual insurance companies that sell drug coverage to Medicare patients -- would negotiate prices with pharmaceutical manufacturers. Many top Democrats say they will make this a priority early on. Still, they have not decided how to do it. The choices, all opposed by the Bush administration, include removing a few words in the law that prohibit those negotiations, requiring the government to negotiate, setting specific discounts drug companies must provide, or creating a government drug plan to compete with the private-sector plans.

Longer-term, key Democrats would like to reverse broader changes by Republicans that have tilted Medicare -- a 1960s-era entitlement that insures 42 million people -- toward the private sector. Democrats believe HMOs and other private health plans are being paid too much for treating Medicare patients. And they would like to get rid of a crucial, if technical, part of the 2003 law that eventually could allow Congress for the first time to restrict the program's spending.


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