Thursday, September 25, 2003

Capitol Hill Watch

Republican Leaders Set Oct. 17 Deadline for Final Medicare Bill

      Republican congressional leaders on Wednesday met with Republican members of the conference committee charged with reconciling the House and Senate Medicare bills (HR 1 and S 1) to lay out a four-week timetable that would have negotiators reaching a final agreement by Oct. 17, the AP/Las Vegas Sun reports. Under the plan presented by Senate Majority Leader Bill Frist (R-Tenn.) and House Speaker Dennis Hastert (R-Ill.) to conferees Reps. Bill Thomas (R-Calif.) and Billy Tauzin (R-La.) and Sen. Charles Grassley (R-Iowa), negotiators would save some of the more contentious issues for later (Espo, AP/Las Vegas Sun, 9/24). CongressDaily/AM reports that the timetable lays out the following schedule:

• Week one: Conferees would reach agreement on issues related to competition between health plans this week.
  
  
• Week two: Next week, conferees would address the drug benefit's design, including whether higher-income beneficiaries should be required to pay more out-of-pocket for prescription drugs before catastrophic coverage takes effect and drug coverage issues for low-income beneficiaries. Conferees next week also would discuss issues related to cost containment, provider payments, the structure of a new federal agency to oversee a Medicare prescription drug benefit and "revenue" provisions, such as a House-passed provision that would allow for the creation of new health savings accounts, CongressDaily/AM reports.
  
  
• Week three: Between Oct. 6 and Oct. 10, negotiators would address the approval process for generic drugs and reimportation of U.S.-made medications from foreign nations, would begin drafting the legislation and would have it scored by the Congressional Budget Office.
  
  
• Week four: Between Oct. 13 and Oct. 17, the final week, conferees would discuss the "two thorniest issues" in the Medicare bills: the House-passed provision that would have private plans compete with traditional Medicare beginning in 2010 and the Senate-passed provision calling for the federal government to administer drug coverage in areas where fewer than two private health plans are participating, CongressDaily/AM reports.
  

CongressDaily/AM reports that some lawmakers involved in the negotiations say the timetable is "unrealistic." Tauzin said the timetable "is a loose thing -- not fixed in stone," adding that while Oct. 17 is the "goal -- it might be an impossible goal" (Rovner/Heil, CongressDaily/AM, 9/25). Grassley said, "I'm not sure we're going to get [a final bill] done by Oct. 17." However, Grassley added that the chances of passage for a final bill could become slimmer if negotiations extend into the presidential campaign season. "I'm even more pessimistic than just saying [the chance of having a final Medicare bill] might be hurt for 2004. I think this thing would be set back for several years," he added (Norman, Des Moines Register, 9/25).

Administration Involvement
The Bush administration Wednesday "stepped up its involvement" in the Medicare negotiations, the AP/Sun reports. President Bush has invited members of the conference committee to the White House for a Thursday meeting, the first such meeting since negotiations began nearly three months ago. In addition, Vice President Cheney discussed Medicare negotiations with Frist and Hastert in a Wednesday meeting, and HHS Secretary Tommy Thompson has begun meeting frequently with key lawmakers to foster a compromise on a final Medicare bill. Frist and Hastert indicated Wednesday that they are prepared to "step in more forcefully" and make recommendations to members of the conference committee if they fail to meet several interim goals leading up to Oct. 17, the AP/Sun reports. "Clearly when you consider the fact that you've only got a limited number of ... days left, I think [Frist and Hastert] believe we've got to make haste," an unidentified GOP congressional official said (AP/Las Vegas Sun, 9/24).

Letter Protests Reduction in Oncologists' Payments
In related news, 53 senators have signed a letter to Grassley, urging Medicare negotiators to eliminate provisions in the House and Senate bills that would lower Medicare payments for cancer drugs and other treatments administered by doctors in their offices (CongressDaily/AM, 9/25). The Medicare payment system for oncologists who administer cancer drugs to Medicare beneficiaries is based on the average wholesale price of the medications, which is often inflated compared with what doctors paid for the drugs. Oncologists generally are reimbursed 95% of a drug's AWP; Medicare pays 80% and beneficiaries pay 20% of that cost. The House bill would eliminate the AWP system and instead would reimburse independent contractors who provide cancer drugs to the doctors. Under the House proposal, oncologists' reimbursements would be reduced by 30%, or about $500 million, in the first year. The Senate bill would lower to 85% the rate for which providers would receive reimbursement and would offset oncologists' reduced payments by boosting reimbursements for their administrative costs (American Health Line, 6/24). In the letter sent to Grassley, the group of senators said, "In addition to the sheer size of the cuts in both bills, it is [a] generally held belief in the cancer community that the long-term reimbursement schemes imposed by either bill would have a devastating effect on the manner in which cancer care is delivered in this country" (AP/Las Vegas Sun, 9/24). "Cancer caregivers will likely be forced to close satellite office, leaving patients in rural communities with long drives to and from the cancer treatment they need," the letter said (CongressDaily/AM, 9/25).

'New Obstacles'
The Christian Science Monitor on Thursday examined "[n]ew obstacles" to passing a final Medicare bill. For instance, an "exploding" federal deficit -- coupled with President Bush's $87 billion military supplemental funding request -- and criticisms of the current bills by some House conservatives make it less likely that Congress will pass a final Medicare bill this year, according to the Monitor. Those issues and others could slow negotiations and "delay may equal denial," the Monitor reports. If negotiations extend into 2004, the "pressures of presidential politics" could prevent passage in the "foreseeable future," the Monitor reports (Grier, Christian Science Monitor, 9/25).

Extension of Medicare Part B Premium Subsidies Approved
The House Wednesday approved an extension of the Temporary Aid to Needy Families program, which includes a provision that extends a program under which the government pays Part B premiums for low-income Medicare beneficiaries, Congress Daily/AM reports. The provision would extend for six months the QI-1 program, which pays Medicare Part B premiums for beneficiaries whose annual incomes are between 120% and 135% of the federal poverty level. The bill would be funded by a six-month extension of user fees for the U.S. Customs Service. The Senate has not yet taken up the legislation (Congress Daily/AM, 9/25).