Newspaper article St Louis Post-Dispatch (MO)

Medicare Savings Accounts Clear Hurdle Clinton Indicates He"ll Go along with Republican Proposal for Pilot Program

Newspaper article St Louis Post-Dispatch (MO)

Medicare Savings Accounts Clear Hurdle Clinton Indicates He"ll Go along with Republican Proposal for Pilot Program

Article excerpt

Republicans in Congress announced plans Tuesday to let some older adults try medical savings accounts as lawmakers began working out the details of how to keep Medicare afloat for the next decade.

After a morning meeting with GOP lawmakers, President Bill Clinton indicated that he would not fight a demonstration program of Medicare medical savings accounts, as long as it was limited.

Republicans originally had wanted the accounts made available to all the roughly 38 million Medicare beneficiaries but agreed to limit them initially to 500,000. "We wanted to make sure . . . we would not create a clear conflict with the White House," said Rep. Bill Thomas, R-Calif., chairman of the House subcommittee that oversees Medicare. Administration officials are concerned that the accounts could be a boon to wealthy, healthy people who rarely use health insurance, while driving up costs for those who are poorer or sicker and must stay in the traditional Medicare program. "We'll watch closely how they develop anything related to a pilot project or demonstration program," said Mike McCurry, the White House spokesman. House Minority Leader Richard A. Gephardt, D-Mo., was quick to criticize the GOP plan. "Their program attracts only the well-off, while the sicker and poorer people are left behind," Gephardt said. Under the GOP plan, a test group of elderly people could choose to take their entire Medicare benefit as a cash voucher and use the money to buy health insurance to cover the same basic services as Medicare but with a deductible of up to $6,000. They could then combine any leftover money with their own contributions to a tax-exempt savings account used to pay uncovered medical bills. "It is a test of whether or not people are willing to be educated consumers," responsible for controlling their own health care costs, Thomas said. The accord with the White House on medical savings accounts clears the main obstacle to getting the plan through Congress, Thomas said. But the plan also includes GOP medical malpractice revision, which has faced strong opposition from the White House and the Senate. The GOP plan fleshes out the details of a 12 percent cut in Medicare's projected spending - the biggest piece of the plan that Clinton and Congress struck to balance the budget by 2002. …

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