The nation's elderly, once expected to be the big losers in the budget battle, will come out as relative winners if Congress passes an agreement worked out by negotiators. Medicare budget cuts and monthly premium increases would bring about $44-billion in savings, down from the $60-billion slice the government health insurance program would have weathered in a bipartisan plan that emerged from the summer's budget summit.
The monthly premiums paid by all but the poorest beneficiaries would rise to about $46.50 by 1995, up from $28.60 this year, heading on the same upward path the government has set for several years. A Medicare insurance deductible that beneficiaries pay would be set at $100, up from the current $75, but not as high as the $150 proposed in the summit.
What's more, if Congress passes the budget deal, Medicaid programs for low-income elderly and children would expand $2.3-billion over five years, even in this era of supposed deficit cutting.
If the plan is approved, couples up to the poverty line _ $8,420 a year in 1990 _ qualify for having Medicaid pay their Medicare premiums. In the years ahead, premiums for people just above the poverty line would be covered, too. The current law has Medicaid pay for people earning 95 percent of the poverty line.
In another Medicaid expansion, the program would cover health care at home for frail, low-income seniors. Medicaid now covers nursing home stays for the very poor. Also, negotiators agreed to offer Medicare coverage for mammogra
phy tests for breast cancer.
"We've done everything we can to protect the needy elderly," said David Pryor, the Arkansas Democrat who chairs the Senate Special Committee on Aging. "I don't think we'll hear a lot of complaining."
Marsha Simon, legislative director for the Families USA advocacy group, agreed: "I think we did great. I think seniors should be extraordinarily happy."
The plan, part of the $500-billion deficit cutting measure, must be passed by the House and Senate and signed by President Bush. The Senate Finance Committee late Friday approved final details.
Despite the cheery reviews, budget and health experts agree the proposal does not solve the problems of offering long-term care to the nation's fast-growing elderly population and insurance coverage to the country's 33-million uninsured of all ages. A report by the Pepper Commission put the cost for those two problems at more than $65-billion a year.
Even before that expense is tackled, senior citizens face an image that they are "greedy geezers" who enjoy expensive government benefits while poor children, the environment and other needs go under-financed.
In the Washington Post last week, economist Robert J. Samuelson said this year's budget plan proves the elderly are "pampered" and that the government is a "gigantic machine for taxing workers to support retirees."
The budget agreement wound up cutting 6 percent in the expected $747-billion spending for Medicare over the next five years, according to the Wall Street Journal. As an indication of rising costs, experts say the Medicare account is going broke even though the agreement would raise more money by adjusting a 1.45 percent payroll tax that finances the program's hospital coverage.
"I think frankly it's a damn shame they didn't do the $60-billion (in cuts)," said Carol Cox, head of the bipartisan Committee for a Responsible Federal Budget. "Medicare is the fastest-growing program in the budget, if you don't count interest. Medicare is just going to eat us alive if we don't do something about controlling health care costs."
But the demands for services will continue as the population gets older and the poor of all ages do without insurance.
The result: In the coming years, either beneficiaries will have to pay more for Medicare, all taxpayers will pay more, the program will be cut, or a mix of all three. Some crusaders also suggest a fourth alternative: The country should turn to a national health care program.
Experts note that as the population ages, the voice of seniors will be heard ever more clearly.
Indeed, many lawmakers say they are so nervous after earlier attempts to freeze Social Security cost-of-living increases or make seniors pay for their catastrophic health care coverage that Congress backs off new plans to limit costs. An idea to save money by taxing Social Security benefits on upper-income retirees rarely reaches the debate's forefront.
Minnesota Rep. Bill Frenzel, senior Republican on the Budget Committee, uses a subway train analogy to describe this political fear of the senior citizens' clout at the ballot box. "There's a large number of people out there who think Social Security is the third rail of politics: If you touch it, you die," Frenzel said during a recent break in budget negotiations.
One of the few Social Security changes to surface this year was a plan to increase benefits to upper-income beneficiaries. Many lawmakers embraced eliminating the so-called earnings test that forces workers between 65 and 69 to give up $1 for every $3 they earn over $9,360. Aides said that the proposal to eliminate the earnings test is dead, though changes passed earlier will bump the limit slightly the next few years.
But when it came to cutting costs this year, budget writers for the Bush administration and Congress found little political will among lawmakers who had to head home and face voters on Nov. 6.
In early negotiations, some lawmakers suggested tying the size of monthly Medicare Part B premiums to income. In other words, those who could afford it would pay more for Part B, which covers doctors' bills.
That idea didn't fly. Then, the negotiators in the bipartisan budget summit agreed to force beneficiaries to pay 30 percent of the Part B program, up from the current 25 percent. That would boost monthly fees to about $54.30 by 1995. The plan saved $60-billion.
Seniors' groups reacted loudly and swiftly. Members of Congress say they were deluged with telephone calls and letters, prompting the House to reject the proposed deal in an early test vote Oct. 5.
To keep up the pressure, a direct-mail fund-raising group named the National Committee to Preserve Social Security and Medicare sent an estimated 2-million letters to its members urging them to write Congress. "Never have I been more worried about the threat of Social Security and Medicare cuts than I am at this moment," wrote Committee President Martha McSteen.
The agreement elicits about $10-billion from beneficiaries through premium increases and cuts another $34-billion from health care providers. Cuts on providers' payments will be passed on in many cases to the elderly.
The deal would also have retirees pay 25 percent of the Part B program and taxpayers pay the rest. Experts call that a bargain.
"Now, if somebody wanted to sell you an insurance policy for 30 cents on the dollar, wouldn't you take it and run?" said Cox, of the Committee for a Responsible Federal Budget.
Pryor and other lawmakers point out there are a few cost-cutting measures and reforms in the package, as well:
Congress is expected to pass a plan to force state Medicaid programs to buy the least expensive prescription drugs.
And lawmakers were still working on a plan to reform the Medigap insurance market that private companies offer to augment Medicare coverage.
Under it, according to the New York Times, either the federal government or the national organization of state insurance commissioners would specify the provisions of 10 standard private health insurance policies containing "a core group of basic benefits" to replace the thousands of policies now sold to elderly people in the private market.