Executive Summary

MEDICARE CATASTROPHIC CARE BILL: PRESIDENT REAGAN WILL SIGN the legislation produced by a House-Senate conference although it may contain many features from the House version in which the President objects, Rep. Waxman (D-Calif.) predicted at a Nov. 10 analysts meeting sponsored by L. F. Rothschild in New York. "It's clear that he's [Reagan] going to sign it. Since he's willing to support the Senate bill . . . he'll sign the bill that we send to him," Waxman asserted. Differences between the House and Senate versions of the Medicare catastrophic care legislation are "important," Waxman said. However, they "will not keep us from resolving" discrepancies between the bills. Describing the Senate bill's drug benefit provision, particularly its phase-in and its $600 deductible, Waxman contended that S 1127 "succeeds only in its lack of aggressiveness." Whereas the House bill (HR 2470) would provide benefits for 6.2 mil. Medicare enrollees by 1992, "the Senate would cover 2.4 mil. beneficiaries." Another key difference, Waxman said, is the House bill's requirement that state Medicaid programs use savings resulting from Medicare coverage of low-income Medicare beneficiaries to help those whose income is below the poverty level but do not qualify for Medicaid. Under the House bill "states would pay their Medicare premiums and cover their Medicare deductible," Waxman noted. However, under the Senate measure "state Medicaid savings would not be recaptured." On the other hand, "both the House and Senate bills represent the first time that the federal government will pay for drugs with a national set of rules," the California Democrat said. "There are 50 different payment rules in the Medicaid program." The bills are also similar in that they "represent the first time that Medicare will collect data on the prices charged for prescription drugs," Waxman continued. Brandname drug manufacturers opposed the legislation due to fear of congressional cost controls, he maintained. "If Congress sees manufacturer price increases of the magnitude of the last five years, brandname companies assume Congress will enact cost controls to keep Medicare premiums down. They are right."