House Passes GOP Prescription Drug Plan?

By Susan Jones | July 7, 2008 | 8:26 PM EDT

( - By just three votes, a Republican prescription drug plan squeaked through the House Wednesday night, prompting a veto threat from the White House and complaints from Democrats that they were denied a vote on their own drug plan.

Five Democrats voted for the Republican plan, and ten Republicans voted against it, making the final tally a close 217-214.

"We knew that Medicare had to change, [that] prescription drugs had to be integrated, that it was overdue," said California Republican Bill Thomas, chief author of the legislation.

The Republican drug plan depends on private insurance companies -- backed by government subsidies -- to sell prescription drug policies to seniors. Republicans say their plan will offer seniors a choice of prescription drug policies, thus creating competition that will bring down drug prices.

The Republican plan will cost an estimated $40 billion over five years, much less than alternative Democratic plans, which would create a prescription drug benefit as part of an expanded Medicare program.

Getting more specific, "standard" coverage under the Republican plan would cost about $35 a month with a $250 deductible. After meeting the deductible, seniors would then pay half of the next $2,100 in drug costs.

Beyond that $2,100 level, seniors - except for the very poor - would then pay all drug costs until reaching a "catastrophic" level of $6,000 a year, after which the policy would pick up all subsequent costs.

Democrats, on the other hand, back a plan that would cost an estimated $100 billion over five years, more than twice as much as the GOP prescription drug blueprint.

Monthly premiums would start at $25; the Democratic plan would pay for 50 percent of annual drug costs up to $2000 (initially); and there would be no deductible. Full coverage would begin after a senior racked up $4000 in annual drug costs.

Selling the plan back home

Passage of a prescription drug plan gives Republicans something to brag about - and Democrats something to rail against --- as lawmakers head to their home districts over the July 4th recess.

GOP lawmakers can say they're keeping big government out of the prescription drug solution by offering incentives to private insurers.

They are expected to emphasize the fact that their plan offers seniors a choice - that it is not "one size fits all," as the Democratic plan seems to be. Republicans can also point to the fact that their plan is far less burdensome to taxpayers -- it doesn't create a massive new entitlement program.

Democrats already are blasting the GOP plan as unworkable - a hoax, a sham, and in the words of Rep. Charles Rangel (D-NY), a "cockamamie scheme." President Clinton is leading the Democratic opposition.

"The bottom line is their plan is designed to benefit the companies who make the prescription drugs, not the older Americans who need to take them. It puts special interests above the public interest," Clinton said at a news conference Wednesday.

That old familiar chant, that Republicans champion companies at the expense of needy individuals, was echoed by another Democrat before Wednesday's vote.

In urging his colleagues to support the Democratic prescription drug plan, Rep. Pete Stark (D-CA) said, "This is a bill that will help the American people, not the drug industry or the insurers."

But, according to Democrats, even the insurance industry doesn't like the GOP plan. And Democrats also say there's no guarantee that prescription drug coverage would be offered by private insurers in every region of the country.

Momentum building in Senate

Now that the House has passed a prescription drug plan, momentum is building for action in the Senate.

Until now, the Senate has been reluctant to act on a drug plan without first overhauling the entire Medicare system. But with the November election fast approaching, and with prescription drug assistance emerging as a hot-button issue, the Senate is taking steps in that direction.

Senate Majority Leader Trent Lott (R-Miss.) reportedly plans to meet Thursday with Sens. John Breaux (D-LA) and Bill Frist (R-TN) to discuss a prescription drug bill they introduced Wednesday. The Breaux-Frist plan combines elements of the House Republican and Democratic proposals.

See Earlier Story:
Prescription Drug Debate Rages on House Floor (28 June 2000)