NCPA - National Center for Policy Analysis

A Route to Medicare Reform

February 20, 2003

President Bush wants to achieve Medicare reform by linking a drug benefit to it. Those who have seen a draft of his proposal generally give it high marks. Under the new plan:

  • Seniors would have a choice of a drug benefit with coverage by a Health Maintenance Organization (HMO), under a renamed version of Medicare Plus Choice.
  • But they would also get a drug benefit if they chose an "enhanced fee-for-service" plan, which would be run by the private sector and operate like a preferred-provider organization -- the doctor networks that now cover about half of insured American workers.

Analysts say both of these options would provide better catastrophic coverage than traditional Medicare. Seniors could also decide to keep their Medicare as is, without a drug benefit -- since at least two-thirds of them already have some kind of drug coverage.

The main objective is to give seniors more choices and President Bush has said he wants to have Medicare look more like the Federal Employees Health Benefits Program -- which gives government employees a variety of options.

Source: Editorial, "GOP Medicare Wimp-Out?" Wall Street Journal, February 20, 2003.


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