Everyone is wondering what is going to happen on Medicare. No one can know the answer at this point, but several things are clear:

• Attention has shifted since Congress left town a month ago. Medicare dominated the summer debate, but enthusiasm has waned for the House and Senate bills as details have become clearer, especially about the drug benefit.
  

  The August blackout also has pushed energy issues to the top of the congressional docket. In addition, the growing danger in Iraq, the California recall election, and the Democratic presidential race are competing for the nation’s attention. This could mean that the imperative to pass a major Medicare bill also is waning.
  

  
  
• With every passing day, political calculations become more important than policy decisions. A Medicare bill passed the Senate largely because Democrats decided to participate in a serious process to get a bill written. (House action was a given.) Will Democrats recalculate the odds now that their constituents have seen the details of the drug benefit? Some might conclude that they could make bigger political gains by promising a better benefit if they were in control.
  

  That’s not to say that the policy issues aren’t tremendously important. They are. But negotiations over fallbacks, premium support, prescription drug importation, and rural issues aren’t the only considerations.
  

  
  
• There are two big themes before the Medicare conferees: 1) The creation of a new prescription drug benefit, and 2) An opportunity to make critically needed improvements in the Medicare program. Few in the general public are aware that there are two separate issues.
  

  There is a huge opportunity here to make progress on modernizing this outdated program, which many members oppose, but the price will be a drug benefit, which other members don’t like.
  

  Harvard Professor Bob Blendon observes that “Congress is between a rock and a hard place. Seniors will be critical of Congress if it does not pass a prescription drug bill, but unhappy if it passes either of the current bills.”
  

  On overall Medicare reform, the public is not pumped up in demanding structural changes because the average person doesn’t see much wrong with the program today. The train wreck is in the future.
  

  As a result, Sen. Kennedy can be expected to continue to hold his ground against reform. At the same time, it’s hard to see Ways and Means Chairman Thomas giving in on his visionary goal of making Medicare a modern and competitive program, shared with Energy Chairman Tauzin and others.
  

  
  
• Does that mean we have a stalemate? With a Republican president and Senate and House leaders all determined to get a final bill, I discount critics who say that nothing will pass. President Bush, Speaker Hastert, and Majority Leader Frist may wind up being primary players in the final negotiations and, they can, I believe, get a bill.
  

  But they will need to settle on where they can find a respectable amount of bipartisan agreement.
  

  
  
• The final compromise may be scaled back from the 2,000 pages of legislation now on the negotiators’ table. It could include: 1) a more targeted drug benefit primarily for low-income seniors without coverage, especially those with large drug bills, 2) a pilot or demonstration project for a new competitive Medicare program, and 3) some reforms, like disease management, to make traditional Medicare better, with more money to providers and existing plans.
  

  This could mean that the 108th Congress makes a down payment on a Medicare bill, with more to come.
  

Many other scenarios are possible, of course, so if anybody finds the crystal ball, please give me a call.

Grace-Marie Turner

Everyone is wondering what is going to happen on Medicare. No one can know the answer at this point, but several things are clear:

• Attention has shifted since Congress left town a month ago. Medicare dominated the summer debate, but enthusiasm has waned for the House and Senate bills as details have become clearer, especially about the drug benefit.
  

  The August blackout also has pushed energy issues to the top of the congressional docket. In addition, the growing danger in Iraq, the California recall election, and the Democratic presidential race are competing for the nation’s attention. This could mean that the imperative to pass a major Medicare bill also is waning.
  

  
  
• With every passing day, political calculations become more important than policy decisions. A Medicare bill passed the Senate largely because Democrats decided to participate in a serious process to get a bill written. (House action was a given.) Will Democrats recalculate the odds now that their constituents have seen the details of the drug benefit? Some might conclude that they could make bigger political gains by promising a better benefit if they were in control.
  

  That’s not to say that the policy issues aren’t tremendously important. They are. But negotiations over fallbacks, premium support, prescription drug importation, and rural issues aren’t the only considerations.
  

  
  
• There are two big themes before the Medicare conferees: 1) The creation of a new prescription drug benefit, and 2) An opportunity to make critically needed improvements in the Medicare program. Few in the general public are aware that there are two separate issues.
  

  There is a huge opportunity here to make progress on modernizing this outdated program, which many members oppose, but the price will be a drug benefit, which other members don’t like.
  

  Harvard Professor Bob Blendon observes that “Congress is between a rock and a hard place. Seniors will be critical of Congress if it does not pass a prescription drug bill, but unhappy if it passes either of the current bills.”
  

  On overall Medicare reform, the public is not pumped up in demanding structural changes because the average person doesn’t see much wrong with the program today. The train wreck is in the future.
  

  As a result, Sen. Kennedy can be expected to continue to hold his ground against reform. At the same time, it’s hard to see Ways and Means Chairman Thomas giving in on his visionary goal of making Medicare a modern and competitive program, shared with Energy Chairman Tauzin and others.
  

  
  
• Does that mean we have a stalemate? With a Republican president and Senate and House leaders all determined to get a final bill, I discount critics who say that nothing will pass. President Bush, Speaker Hastert, and Majority Leader Frist may wind up being primary players in the final negotiations and, they can, I believe, get a bill.
  

  But they will need to settle on where they can find a respectable amount of bipartisan agreement.
  

  
  
• The final compromise may be scaled back from the 2,000 pages of legislation now on the negotiators’ table. It could include: 1) a more targeted drug benefit primarily for low-income seniors without coverage, especially those with large drug bills, 2) a pilot or demonstration project for a new competitive Medicare program, and 3) some reforms, like disease management, to make traditional Medicare better, with more money to providers and existing plans.
  

  This could mean that the 108th Congress makes a down payment on a Medicare bill, with more to come.
  

Many other scenarios are possible, of course, so if anybody finds the crystal ball, please give me a call.

Grace-Marie Turner