Snags in Plan to Lower Age Limit for Medicare

Clinton pushes hard for health-care benefits for those under age 65, but Congress wants to wait for new study.

To most Americans, the word "Medicare" evokes images of retirement. Indeed, enrolling in the huge government health program has long been a rite of passage for many 65-year-olds.

Now President Clinton wants to allow folks as young as 55 to buy into the program. The proposal is one of the most important parts of the White House 1998 agenda - and could fundamentally alter Medicare's traditional role as a safety net almost exclusively for the elderly.

The proposal has already run into a significant roadblock. Key congressional figures say they want to hold off action until the new National Bipartisan Commission on the Future of Medicare makes its recommendations next year.

But the White House said this week that Mr. Clinton has no intention of backing off from the measure, which might resonate with voters going into this year's congressional elections. And program expansion is sure to be a hot topic in Medicare commission meetings.

The commission, which began its work last Friday, is examining how to save Medicare after 2010, when the first of 77 million baby-boomers enter the program. If no changes are made, the Medicare trust fund will go bankrupt and begin eating into general revenues. The 17 commissioners appointed by the president, the Senate, or the House must submit their report by March 1, 1999.

"I have no problems with Congress [passing the Clinton proposal]," says Sen. John Breaux (D) of Louisiana, the commission's chairman. "[But] I think most members would say, 'Let's wait for the commission.' "

The board's administrative chairman, Rep. Bill Thomas (R) of California, is more blunt: "It isn't going to happen."

Republicans and some Democrats say the Medicare program isn't stable enough to handle an expansion of benefits now. The federal health-care program for senior citizens faced imminent bankruptcy until Congress gave it a 10-year reprieve via financing changes made in last year's balanced-budget agreement. That agreement also created the bipartisan commission to explore Medicare's future.

Private market won't take them

Approximately 3 million people out of 21.5 million aged 55 to 65 have no health insurance, according to the Employee Benefit Research Institute, a nonprofit organization here. "This is a group whom the private market has basically walked away from, often because of a preexisting [physical] condition," says Martin Corry, director of federal affairs for the American Association of Retired Persons (AARP), the nation's largest senior-citizens' lobby.

"No one quarrels with the fact that there are a number of people who are without insurance," says Representative Thomas, who chairs the House Health subcommittee and is the House GOP's Medicare guru. But he opposes expanding Medicare at a time when commissioners are trying to figure out how to save it.

Clinton's proposal, unveiled during his State of the Union address, is part of his strategy of extending coverage to specific groups of people without insurance, which he adopted after the failure of his 1993 proposals for comprehensive health-care reform. A 1996 bill guaranteed continued insurance to certain workers who change jobs. Last year's budget deal created a new program for certain uninsured children.

His latest plan would cover three specific groups of uninsured:

People aged 62 to 65 who do not have access to health insurance could pay a $300 monthly premium and receive full Medicare coverage. After age 65, those who do so will pay a premium surcharge of $16 to $50 a month above what all Medicare beneficiaries pay.

People between ages 55 and 61 who lose their job, qualify for unemployment, and do not have access to health insurance could get Medicare benefits for a $400-per-month premium.

Retirees aged 55 to 64 whose former employer drops their retiree health insurance could buy into Medicare for a premium 125 percent of that paid by the firm's active employees.

Clinton argues that his expansion proposal won't cost Medicare, because beneficiaries will pay for it through their premiums, which in some cases are higher than the cost of private insurance through an employer. He got a boost last week from the Congressional Budget Office (CBO), which put the cost at about $300 million over five years, or a fraction of 1 percent of Medicare outlays.

Only a first step

But Carrie Gavora, who analyzes health-care issues for the conservative Heritage Foundation, a Washington think tank, says once the program is created, pressure will build to extend it to those who cannot afford to pay the premiums, thus draining the trust fund.

Ms. Gavora says it's time to ask why health-care coverage is linked to employment in the first place. She argues for giving individuals tax credits, tax-exempt savings accounts, or other market choices to meet their health-care needs.

Senator Breaux says the commission should look at allowing people in the target group to buy into the Federal Employees Health Benefit Program. Under that program, federal employees can purchase coverage from a smorgasbord of options, including traditional fee-for-service insurance, health-maintenance organizations, or preferred-provider plans.

The president's supporters in Congress vow to keep the pressure on. "It's way too early to declare that this proposal is dead for the year," says a House Democratic source. "It's the kind of proposal that has strong public support. If you can have a full and fair hearing, particularly in the Senate, it would be a little hard to vote against it."

But the AARP's Mr. Corry says it will be tough for Congress to take up the proposal in the number of legislative days left this year. "If it doesn't happen this year, that's not the worst thing, as long as Congress keeps it on the agenda and it gets the attention it has to have," he says. "Sooner or later, whether it's through Medicare or other means, Congress absolutely has to address this issue."

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