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House Panel OKs Reduced Medicare Spending

13-0 vote is a first step toward putting balanced budget deal in place

WASHINGTON (AllPolitics, June 5) -- A House subcommittee has given quick, 13-0 approval to changes in the Medicare program that will limit the growth of spending and give seniors more choices in their health care.

While Democrats on the House Ways and Means health subcommittee were unsuccessful in pushing through several amendments, they joined with Republicans to produce Wednesday's unanimous final vote.

Rep. Bill Thomas (R-Calif.), the subcommittee's chairman, said the vote showed broad, bipartisan support for real change in how the nation finances health care for the elderly, and Democrats agreed. "On balance, it's still a good bill," said Rep. Pete Stark, a California Democrat.

The bill's most important provision would limit the growth of Medicare spending by $115 billion over the next five years. It's the single largest projected savings in the budget deal.

The full Ways and Means Committee will consider the bill next week. Most of the savings would come from reducing payments to hospitals and other health care providers. Lawmakers say the plan would extend the life of the Medicare hospital trust fund by 10 years, transferring the rapidly growing cost of home health care into a separate budget supported by general tax revenues.

In a compromise, the Clinton Administration agreed to permit a demonstration project allowing 500,000 seniors to open medical savings accounts. Participants will receive a cash voucher, use a portion of it to buy catastrophic health insurance and put the rest in a tax-exempt savings account, to use for other medical bills.