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MEDICARE


Q U I C K  T A K E

ONE OF THE LARGEST sacred cows in American politics, Medicare provides medical insurance for more than 37 million elderly and disabled Americans, which means it alone swallows almost one-tenth of the federal budget each year. Any meaningful deficit reduction package must put Medicare on the cutting block, and any talk about shrinking the medical safety net riles the vocal senior lobby. That potent combination makes Medicare one of the most volatile -- and unresolved -- political issues of the 1990s.

A 1995 report by Federal Hospital Insurance Trust Fund trustees predicts that Medicare Part A, which pays for hospital bills, will go bankrupt by 2002. Some proposals to strengthen Part A include using money from Part B, which covers doctors' bills, to foot some hospital bills. While Democrats disagree with the size of Republican efforts to reform Medicare, most agree with the nature of the proposed reductions: reduce government payments to health-care providers, encourage senior citizens to join health maintenance organizations (HMOs), and require well-to-do recipients to pay a larger share.

The Republicans sought to cut $270 billion in Medicare spending over the next seven years, allowing for 5.8 percent annual program growth, while medical costs were expected to rise 7.6 percent each of those years. Democrats charged that the Republican proposal was too drastic and claimed the GOP was cutting Medicare to provide tax breaks for the rich, and the GOP got eviscerated on the issue. Republicans, however, argue that the survival of the program demands reforms more drastic than the $124 billion in cuts Democrats were seeking over the next seven years. President Bill Clinton's health care plan, which went down in flames in 1994, would have cut $46 billion in Medicare over the first five years, but the defeat of that overhaul put Medicare reforms on the back burner. Lost in the political firefight is the pragmatic question of how seniors, whose medical needs are greater, would fare in HMOs that limit access to doctors and medical technologies.


P U B L I C  O P I N I O N

CNN/USA Today/Gallup Poll, March 15-17, 1996

Now thinking about some issues, do you approve or disapprove of the way Bill Clinton is handling Medicare?


96 Mar 15-17
96 Jan 15-17
Approve
41%
42%
Dis-approve
51%
8%
No opinion
51%
7%
CNN/USA Today/Gallup Poll, March 15-17, 1996

Now thinking about some issues, do you approve or disapprove of the way Bob Dole is handling Medicare?


96 Jan 15-17
Approve
33%
Dis-approve
51%
No opinion
16%
CNN/USA Today/Gallup poll January 12-15, 1996

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