By a straight party-line vote, the House last week passed a GOP blueprint to balance the federal budget by 2002, partly by reducing projected Medicare costs by $168 billion and Medicaid by $72 billion.
At week's end, the Senate had begun debate on a similar GOP plan.
Almost from the outset, this year's debate looked like a repeat of last year's budget fight. Democrats charged that the Medicare reductions were still too high, and Republicans argued that the deteriorating condition of the Medicare Part A trust fund necessitates significant reforms.
Sen. James Exon of Nebraska, ranking Democrat on the Senate Budget Committee, said that "after 18 months of extremism and demagoguery, after two government shutdowns......I had expected more."
But Rep. John Kasich (R-Ohio), House Budget Committee chairman, accused Democrats of again scaring senior citizens by exaggerating the Medicare spending constraints in the plan.
Included in the GOP budget are as-yet-undetailed provisions to reduce projected Medicare Part A spending by $123 billion, while Part B would see $45 billion in reductions, some of that from hospital outpatient reimbursements.
Hospital groups are upset that the ratio of reductions is heavily skewed to Medicare Part A payments, which primarily go to hospitals.
In an advocacy alert sent to its members, the American Hospital Association said the GOP plan "singled out hospitals for a disproportionate amount of the reductions in Medicare financing, while failing to demand any significant sacrifice from beneficiaries."
The GOP plan wouldn't raise beneficiary costs from the current rate. By law, beneficiaries now pay 25% of the cost of Medicare Part B services. That's down from 31.5% last year. The beneficiary rate is scheduled to drop to about 19% in 1999 under current law. However, both the GOP and White House budgets have proposed maintaining the 25% premium rate.
The Senate also will vote, probably early this week, on a bipartisan substitute blueprint that seeks $105 billion in Medicare savings and $41 billion in Medicaid savings from 1997 to 2002.
The Congressional Budget Office estimates that without any legislative changes, Medicare payments will increase from $196 billion this year to $332 billion in 2002.
Republican leaders confirmed last week that they plan to split action on a budget reconciliation bill into three separate votes. The reconciliation bill would implement the blueprints being debated last week.
The first vote would be on Medicaid and welfare reform. If that package passes and is signed by President Clinton, then Congress would take up a Medicare reform plan. The third measure would encompass all the remaining tax and spending provisions.
Because a Medicare vote would only be triggered by the enactment of Medi-caid and welfare reform, both of which Clinton vetoed last year, it's unlikely a Medicare vote will occur before the November election.