Bush to Push Medicare Drug Plan

ByABC News
July 6, 2001, 3:25 PM

W A S H I N G T O N, July 6 -- President Bush is set to push his plan to expand Medicare to cover prescription drugs, but Democrats say the administration's mammoth tax cut is threatening the solvency of the 36-year-old health insurance program.

Amid building public pressure and widespread support for the creation of a prescription-drug benefit, Medicare reform is shaping up as the next major legislative battle for the White House and its foes and allies on Capitol Hill.

White House: 'There Is No Surplus in Medicare'

With the president expected to unveil his principles for reform next week, Senate Democrats plan to call White House Budget director Mitch Daniels on the carpet at a public hearing next week to ask him why his boss plans to dip into the Medicare trust fund in order to pay for his tax cut something the Bush administration vehemently denies.

"We're on the brink of raiding the Medicare trust fund this year We're in a position of raiding the Medicare trust fund for every dime that's in it next year," Sen. Kent Conrad, D-N.D., the chairman of the Senate Budget Committee, said at a news conference this week. "This is fiscal mismanagement on a grand scale."

"The truth, in fact, is that Medicare dollars will be used only for Medicare," Bush's chief economic adviser, Larry Lindsey, said in a statement.

In addition to raiding the trust fund, Democrats accuse the White House of planning to invade the so-called Medicare surplus "excess" revenue from a payroll tax on workers and employers that Democrats have argued should be put in a legislative "lockbox."

Not so say the president's aides, who contend there will be no "raid" on the Medicare surplus because there simply isn't a surplus to be raided.

"There is no surplus in Medicare," White House press secretary Ari Fleischer told reporters. "There is a shell game."

Who you believe depends on what precisely you classify as "Medicare dollars" and which set of Medicare accounting procedures you think is really a "shell game": the government's current procedures, or the ones suggested by the president. But in a town where the definition of the word "is" has been the subject of great debate, there is unlikely to be bipartisan agreement anytime soon.