The Senate refused Friday night to repeal catastrophic health coverge for retirees and voted instead to preserve some benefits but kill the unpopular surtax that pays for them.
A 99-0 vote approved a bill by Sen. John McCain, R-Ariz., that would wipe out the surtax along with extended reimbursement for physicians' fees and coverage for prescription drugs. That would leave a program built around nearly unlimited reimbursement of hospital charges.The House voted earlier this week to repeal the entire program. Negotiators from the House and Senate will have to work out a compromise between the two bills.
"Senior citizens will rest a little easier tonight knowing . . . that this body has acted in a sensible fashion," McCain said.
The Senate paved the way for accepting McCain's bill when it refused to repeal the program outright. The vote against a repeal amendment offered by Sens. William Roth, R-Del., and John Danforth, R-Mo., was 73-26.
Sen. Spark Matsunaga, D-Hawaii, did not vote on the McCain proposal
Roth, arguing for repeal, compared the year-old catastrophic coverage with the ill-fated Edsel automobile.
"The folks at Ford finally realized that some mistakes . . . can't be disguised," Roth said, "that you've simply got to send the engineers back to the drawing board. That's what we must do with the catastrophic law."
"We promised too much, we taxed too much, but let's not throw it all out," said Republican Leader Bob Dole of Kansas, adding that would leave many low-income retirees with no insurance against costs of an expensive illness and no way to buy it.
Earlier, the Senate turned thumbs-down on a leadership-backed plan that would have preserved most benefits as well as part of the surtax.
That 62-37 vote rejected an amendment by Sen. David Durenberger, R-Minn., to retain almost total reimbursement for hospital charges and, after the patient pays the first $1,780 a year, all doctors' fees. Coverage for prescription drugs would have been eliminated.
Although McCain's plan would wipe out some major benefits, its big selling point was that it would kill the surtax of up to $800 a year, which has drawn the protests of many retirees and which has been the focus of attention in Congress. His amendment was endorsed by most national organizations of senior citizens.
"The object of the anger of senior citizens today is the surtax, and they will not be happy until the surtax is eliminated," said McCain.
The decisiveness of the vote against Durenberger's amendment was surprising because of impassioned pleas for its passage from Senate leaders of both parties and its endorsement by Health and Human Services Secretary Louis Sullivan.
Dole said the biggest problem for catastrophic coverage is that many older Americans do not understand the benefits. He blamed "an extraordinary amount of misinformation given to the elderly."
The voices of retirees who oppose the program have been heard, noted Majority Leader George J. Mitchell, D-Maine. "But there are many whose voices have not been heard . . . the majority of the elderly" who lack private insurance and the money to pay for it, he said.
Hospital costs are rising 5 1/2 percent a year, doctors' fees by 15 percent, Durenberger said. "That is the catastrophe waiting to happen to elderly Americans."
Congress is under heavy pressure from some retirees to repeal or make significant changes in the catastrophic program, enacted last year to protect older Americans from being wiped out financially by an expensive illness. All people eligible for Medicare are required to enroll in catastrophic care coverage.
Most of the complaints are coming from higher-income retirees, who pay a 15 percent surtax on top of their income taxes to finance catastrophic care for themselves and poorer seniors. Only 40 percent of retirees pay a surtax this year; the maximum of $800 per person is paid by about 6 percent.