Real leadership is never easy. So it
deserves to be recognized.
That's why we ought to congratulate the Republican Study Committee
and House Minority Leader Nancy Pelosi, D-Calif., for stepping
forward and offering to help pay for Hurricane Katrina
reconstruction by returning the federal money they won for highway
and byway projects in their districts -- projects tucked away in
the latest highway bill.
Unfortunately, even if all their colleagues go along with the
current challenge to turn back half their transportation
"earmarks," or special projects, that will raise only $25 billion.
Congress already has appropriated $62 billion for Katrina relief,
and some observers expect the final tab will exceed $200
billion.
Clearly, we'll have to trim much more from the federal budget if we
are to even come close to offsetting the rising cost of fixing the
Gulf Coast. Failure to offset this massive spending increase will
lead only to a still-larger deficit, which would crowd out other
worthy priorities and lead us to borrow more from undependable
foreign markets.
All the more reason to consider a bold idea floated by Sen. John
McCain, R-Ariz., and others: Cancel, or at least delay,
implementing the huge Medicare drug entitlement set to take effect
on Jan. 1.
McCain, wisely enough, says we should abandon the Medicare drug
program altogether and go back to the drawing board and design a
rational and responsible drug benefit. But even the RSC's more
modest suggestion to delay its implementation for a year is a big
step in the right direction.
According to the Bush administration, the drug benefit is projected
to cost $37.4 billion next year alone, the first down payment on a
massive entitlement that will add $8.7 trillion to the long-term
debt of Medicare. A simple delay would yield big savings.
Some painful choices will have to be made for the
hurricane-rebuilding projects. But a delay in a drug program that
doesn't yet even exist isn't one of them. Roughly three out of four
seniors already have some form of drug coverage. Congress should
help the minority who are too poor to buy private drug coverage,
are ineligible for Medicaid or aren't covered by their former
employers. And the new Medicare drug-discount cards, which already
have provided big savings for millions of seniors, could be the way
to deliver direct help to poor seniors who need it.
Moreover, the intended beneficiaries of the drug benefit aren't
exactly clamoring for it. Recent surveys show that about a third of
seniors have a favorable impression of the benefit; about a third
have an unfavorable impression; and about a third are neutral or
don't know enough to form an opinion.
And why should seniors be enthusiastic about such a program? Many
of those already covered by former employers will have their
coverage either scaled back to a minimum standard established by
Congress or dropped altogether. Because taxpayers will be picking
up the tab, the non-partisan Congressional Budget Office estimates
that 2.7 million seniors will be moved out of their existing
private coverage next year. Some estimate that still more seniors
will be forced into the program after that, and virtually all
analysts agree the program will accelerate the decline of private,
employer-based coverage.
And the 6.4 million poor seniors whose drugs are covered under
Medicaid, of course, will be required to enter the Medicare drug
program, regardless of their personal wishes.
To make matters worse, many of those forced into the Medicare drug
program will, within the year, learn first-hand of its infamous
"doughnut hole." That's the big gap in coverage that forces some
high-cost beneficiaries to pay 100 percent of their drug bills
until they spend $3,600 out of pocket. Given escalating drug costs
for the sickest seniors and the way the bill is designed, the
Kaiser Family Foundation estimates that 6.9 million seniors will
fall into the doughnut hole in 2006. That process will be repeated
each year.
In other words, next year we'll have a costly new government
program that few want before it's implemented and fewer will like
after it's implemented. We also have an immediate and extreme need
to free up some funds for hurricane victims in desperate need of
relief. We have the chance to re-allocate tens of billions of
dollars from a bad idea to a necessary effort.
So how about it, Congress? Why not cancel the drug entitlement and
target assistance to those who need the most help? If not, how
about at least delaying its implementation and continuing aid to
seniors who need it most through a juiced-up Medicare discount-card
program?
Nobody disputes the urgency of helping poor seniors get the drugs
they need. In either case, Congress needs to take another crack at
designing a Medicare drug benefit that's rational, responsible and
affordable.
Robert Moffit is
director of the director of the Center for Health Policy Studies at
the Heritage Foundation.
Distributed nationally on the Knight-Ridder Tribune wire