Just How Did Medicare Bill Get Passed?

It cannot be overstated how much President George W. Bush has always been one to learn from the mistakes of his father. The first President Bush was pilloried for ignoring needs on the domestic front. His son is determined to not allow that perception to cost him re-election. And last year's Medicare Reform Bill is his exhibit A.

"When we came to office, people had gotten used to what they called gridlock; old problems were used to score points," the president said on March 11. "But we came to Washington for a different reason. We came to solve problems. … That's why we passed reforms of Medicare, to give patients prescription drugs and give seniors choices. No, we came to lead, and we have delivered results for the American people."

The "Medicare Prescription Drug, Improvement and Modernization Act of 2003" is, according to Norm Ornstein of the American Enterprise Institute, "the domestic issue for the White House going into the election season." Before it passed last fall, "the White House and the Republicans in Congress were desperate to get a huge trophy," he said.

Republicans in Congress agree. "The fact is there was an awful lot riding on this bill politically — for the president and for the Republican Party," Sen. Chuck Hagel, R-Neb., told ABCNEWS.

The bill passed the House and Senate and was signed into law on Dec. 8. "Our government is finally bringing prescription drug coverage to the seniors of America," Bush said at the bill signing.

Bush and Republican leaders said the new law would cost $400 billion, providing drug benefits to seniors beginning in 2006, as well as subsidies to insurance companies and HMOs. It would also allow the first steps to allow private plans to compete with Medicare.

Certainly at the time the president never anticipated headlines like these, from recent newspapers in swing states Florida, Michigan and Pennsylvania: "The Medicare fiasco; President's political dream scheme is becoming a nightmare," wrote the Sarasota Herald-Tribune; "Bush's Medicare dream turning into a nightmare," wrote the Detroit Free Press; "Medicare law has become stumbling block for Bush," wrote the Philadelphia Inquirer.

So what happened?

The Price of Victory

To get the bill passed, the attitude across the board, from the White House to the Department of Health and Human Services — which oversees Medicare — to the GOP leaders in Congress was "win at any cost," Ornstein said. "And now we're beginning to see how big that cost was."

According to Robert E. Moffit, director of the Center for Health Policy Studies at the Heritage Foundation, the GOP leadership of the House and Senate said, " 'Look, we're going to have a financially responsible drug benefit. That's what we're going to have, and it's not going to be any more than $400 billion over 10 years.' And the conservatives in the Congress were saying, 'Wow. OK. All right. You know, we budgeted that, but it can't be any more than that.' So they were in a position where they had to hold to that line."

Democrats had proposed a more expensive version. But conservatives like Rep. Pat Toomey, R-Pa., thought even the Republican leadership's $400 billion price tag was too high.

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