A major Medicare expansion

Some conservatives strongly oppose the compromise, contending it doesn't do enough to privatize the overall Medicare system. But conservative supporters note that the new drug benefit will be administered by private plans, which is a step in the direction of full privatization.

Some liberals oppose the compromise on the grounds that it doesn't provide nearly enough benefits. The bill is expected to cover only about a quarter of the $1.8 trillion that Medicare beneficiaries are expected to spend on pharmaceuticals over the next 10 years, according to the Congressional Budget Office. But liberal supporters counter that the basic benefit can be expanded in the future.

"Each side may want to help the elderly, but they also may want to use it as a steppingstone for a broader agenda - the Democrats for broader access and the Republicans for further privatization," says Professor Schlesinger.

The Medicare expansion is made more notable coming in an era when conservatives are dominating politics. But it can also be viewed as being in line with Medicare's history. When the program was created in 1964, it was designed to provide the elderly with the same benefits as the average 45-year-old working man. That has been the both the program's strength and its major weakness.

It fails because the needs of the elderly are very different from the average working person - so that huge gaps remain in Medicare coverage, such as catastrophic care and prescription drugs.

But the intent to model it on the average working person's insurance has also been the foundation for changes. One rationalization for the expected passage of the new compromise is that most working Americans already have drug coverage and now that costs are so high, seniors deserve the same.

In another bow to the clout of the elderly, both the Senate and Mr. Bush are working to make it easier to get access to less-expensive generic drugs. Currently, major pharmaceutical companies take advantage of loopholes in the law to keep generic versions of their most popular drugs off the market once a patent expires.

Last week, the president announced regulatory changes that would make it more difficult for drug companies to do that. The Senate is expected to pass a more comprehensive bill that makes the changes law.

Bush predicts the regulatory changes could save consumers $3.5 billion a year in drug costs. The more extensive Senate bill could save as much as $60 billion.

The proposal, which was approved in the Senate last year, is expected to meet more opposition in the House, where it stalled last year. But with the expected passage of the Medicare drug benefit, some analysts believe the generic bill will make it past hurdles in the House as well.

"If you're going to do this massive expansion of Medicare, whatever you think about it, it makes sense economically to eliminate these barriers to lower-cost medicines," says Brad Cameron of Business for Affordable Medicine, a business lobby group. "It would be the fiscally responsible thing to do."

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