House Democrats silence Medicare alarm, but long-term funding still unresolved

Washington -- When the House last month voted in favor of implementing a trigger-lock measure, the lawmakers were not debating gun control regulations. They were dealing with Medicare's long-term financial future and a funding alarm that signals trouble for the program.

The House approved July 24 a resolution that effectively delays consideration of White House-sponsored legislation to reduce Medicare's reliance on general tax revenues in future years. If the chamber had not done that by July 30, President Bush's measure would have received a fast track to House floor consideration.

The Medicare funding trigger concept dates back to the Medicare Modernization Act of 2003. This measure dictated that an alarm would be tripped if the program's trustees predicted for two years in a row that the portion of total Medicare spending coming from general revenues will exceed 45% within six years. Spending on physician care, hospital care and other services are funded through a combination of general taxes, payroll taxes and beneficiary premiums.

The funding alarm was set off in April 2007 when the second consecutive trustees report projected Medicare would cross that 45% threshold. The law mandated the administration then send legislation to Capitol Hill at the beginning of the next year -- in this case 2008 -- to address the long-term funding issue. If congressional leaders did not bring that White House bill to the floor by the end of July 2008, any House member could force consideration of President Bush's measure and a floor vote.

That fast track has now disappeared, thanks to the House action, which does not require Senate or White House approval. A similar funding warning is still in effect in the upper chamber, but parliamentary rules there prohibit a single lawmaker from forcing a vote on Bush's bill. House aides said that Democratic lawmakers in both chambers next year will likely attempt to repeal the trigger provision outright rather than risk having the funding warning sound anew every time the Medicare trustees come out with their annual report.

House Democratic leaders defended their action to immobilize the trigger provision as a necessary response to what they perceive as a legislative gimmick aimed at slashing Medicare.

"The Medicare trigger was cooked up by Republicans behind closed doors as a political ploy to foster an unfounded panic about the strength of Medicare's finances," said Rep. Pete Stark (D, Calif.), chair of the House Ways and Means Subcommittee on Health. "We must turn off the trigger and reject Republican attempts to arbitrarily limit Medicare financing."

Stark and other Democrats argue that Medicare's trend to require an increasingly larger portion of its funding to be in the form of general tax revenues has no bearing on the program's long-term solvency. Although Democratic lawmakers support some of the Bush bill's provisions, they take issue with his proposal to ease the drain on tax dollars in part by charging wealthier seniors more for their Medicare drug benefit premiums.

Putting off the debate

But Republican leaders accused their Democratic counterparts of ignoring a real long-term financial problem for Medicare and shirking their responsibility to limit how much future generations will be expected to contribute in terms of public health spending.

"This legislative rubber stamp of the entitlement crisis status quo is regrettable, irresponsible, and unfair to our children and theirs, not to mention the seniors who rely on Medicare today," said House Minority Leader John Boehner (R, Ohio). "They will bear the consequences of the Democratic leadership's refusal to step up and do the right thing."

The decision to put the long-term Medicare funding debate on hold also postpones potential action on several proposals that had prompted concern among physician organizations.

Bush's bill, for instance, calls for Medicare to pay for doctors' services based not just on what they provide but on the quality of care. Such a pay-for-performance concept is troubling to many physicians, especially if the perceived emphasis is on cutting spending rather than improving care. The measure also proposes public quality reports for doctors as a way to drive patients toward better, more efficient care -- another concept physician organizations say can be problematic if improperly implemented.

Liability a factor in reform

But the White House bill also includes a medical liability reform proposal that has the strong support of the American Medical Association and other physician organizations. The move to block fast-track consideration of the other provisions also puts that debate on the back burner.

Any discussion of Medicare's funding future must involve a long look at medical liability reform, said Shawn Martin. He's the head lobbyist for the American Osteopathic Assn. and the chair of the Health Coalition on Liability and Access. The coalition is made up of numerous physician, hospital and insurer organizations, including the AMA.

"Comprehensive medical liability reforms have a proven track record of success at the state level of reducing health care costs and increasing patient access to quality medical care," Martin said.

"Controlling our nation's Medicare costs is one more reason America needs national medical liability reform," he said.

Boehner said the House action was payback by Democrats to the trial lawyer lobby that has traditionally backed members of their party over Republicans.