Next president to inherit Medicare morass

Unlike most Republicans, has been harshly critical of the pharmaceutical industry.

In one of his sharpest clashes with then-rival Mitt Romney, McCain accused the pharmaceutical companies of “overcharging of millions of dollars of Medicaid costs to their patients" during a January debate.

"How could that happen?," he railed. "How could pharmaceutical companies be able to cover up the cost to the point where nobody knows?"

"Why shouldn't we be able to reimport drugs from Canada? It's because of the power of the pharmaceutical companies," he said.

Are they the 'big bad guys'?
Romney protested that McCain should not portray the pharmaceutical firms as “the big bad guys.”

“Well, they are,” McCain growled.

No, insisted Romney “actually they're trying to create products to make us well and make us better, and they're doing the work of the free market.”

Both Clinton and Obama have pledged to change the Medicare Part D pharmaceutical program by allowing the plan to force drug companies to supply pharmaceuticals at discounted prices.

Unlike most of his GOP colleagues, McCain voted in 2003 against President Bush’s Medicare Part D proposal to provide pharmaceuticals to older people. McCain explained last October in a speech in Iowa, “I strongly opposed adding another unfunded entitlement to the fiscal train wreck that is Medicare by providing all seniors with a costly drug benefit, even those, like me, who can more than afford to pay for their medicine.”

Should higher-income people pay more?
All three contenders had a chance last year to cast a high-profile vote on controlling the growth of Medicare spending.

Sen. John Ensign, R- Nev. offered a proposal to impose a degree of means-testing. That means that higher-income people would have to pay a higher premium for their prescription drugs under Medicare than middle-income people.

Currently, low-income people have most or all of their Medicare Part D drug premiums paid by the taxpayers, but higher-income seniors pay the same drug premiums as middle-income people do. Ensign would force the wealthy to pay more.

Ever since Medicare was created in 1965, mean-testing has been anathema to most Democrats, who contend that it would erode support for universal medical insurance for the elderly and ultimately lead to its demise.

Clinton and Obama agreed with the traditional Democratic argument: they both voted “no” on the Ensign proposal, as did all other Democratic senators. McCain did not show up for the vote.

Ensign’s idea is one of the 26 specific options to cut Medicare spending that were detailed in a February 2007 report by the non-partisan Congressional Budget Office. The most far-reaching of these ideas is for Congress to do to Medicare what Congress did back in 1983 to Social Security: raise the eligibility age for collecting benefits.

For people born in 1960 or later the eligibility age for full Social Security benefits is 67, not 65 as it was for today’s retirees.

The CBO said Medicare spending could be cut by about ten percent if the eligibility age were increased to 70. It’s a radical cost-cutting idea and one that none of the contenders has endorsed.

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