By Lisa Seachrist

Washington Editor

WASHINGTON ¿ The Medicare program celebrated its 34th anniversary Thursday, and Senate Democrats took the occasion as an opportunity to protest the Republican plan to provide a $792 billion tax cut they claim will squander the budget surplus and place Medicare solvency at risk.

Senate Minority Leader Tom Daschle (D-S.D.) led a group of Democrats, including Sen. Edward Kennedy (D-Mass.), Sen. Bob Kerry (D-Neb.) and Health and Human Services Secretary Donna Shalala in denouncing the Republican tax cut plan. Just a month ago, Congress seemed unified in its desire to provide a prescription drug benefit to Medicare beneficiaries although no bipartisan plan had gained much momentum. Now, the tax cut appears to have taken priority over expanding Medicare benefits.

¿The Republican budget includes $100 billion in new tax breaks for their special-interest friends,¿ Daschle said. ¿But it doesn¿t use one dime of the surplus for Medicare ¿ not one dime.¿

With an aging baby boomer population, Shalala noted that over the next 30 years the number of Medicare beneficiaries will double, placing an enormous burden on a system that already is showing signs of strain. ¿And, unless we act now, this human tidal wave could put the promise of Medicare at risk,¿ she said.

Senate Democrats proposed an amendment to the tax cut plan that would have preserved Social Security and Medicare surpluses until they were needed to pay for the baby boomers¿ retirement. That proposal was defeated late Wednesday evening. The Senate voted down an amendment introduced by Sen. Kent Conrad (D-N.D.) and Sen. Max Baucus (D-Mont.) Thursday evening that would have saved $290 billion of the surplus to strengthen Medicare and provide a prescription drug benefit to seniors.

¿This is a debate about priorities,¿ Kennedy said. ¿New tax breaks are a priority for the Republicans. Prescription drugs for seniors are not. If senior citizens were the priority, we would be debating a Medicare prescription drug bill today, not a tax cut bill. Our amendment will change these selfish priorities.¿

Sens. Olympia Snowe (R-Maine) and Ron Wyden (D-Ore.) introduced legislation in June to provide prescription drug benefits using a vehicle similar to the Federal Employee Benefits Program, which offers federal workers a choice of private health care plans. The plan would offer premium supports of varying levels to all seniors. (See BioWorld Today, June 16, 1999, p. 1.)

Kennedy and Rep. Pete Stark (D-Calif.) introduced a bill that would provide a basic benefit of $1,700 that covers 80 percent of pharmaceutical costs for all seniors with more than $200 in annual drug costs. For Medicare beneficiaries who have more than $3,000 in annual out-of-pocket prescription drug costs, the bill would cover 100 percent of any additional costs (See BioWorld Today, April 21, 1999, p. 1.)

In June, President Clinton unveiled his plan to provide a $5,000 benefit to all seniors, with premium supports for impoverished seniors. (See BioWorld Today, June 30, 1999, p. 1.)

The rhetorical turn from prescription drug benefits to a tax cut caught the attention of the Biotechnology Industry Organization (BIO), which launched a campaign of radio ads to highlight the need to provide a prescription drug benefit to seniors when catastrophe strikes, and the need to prevent agencies such as the Health Care Financing Administration (HCFA) from setting drug prices and limiting access to them.

¿We¿ve launched a two-week campaign to hit the staffers and members of Congress before everyone leaves for vacation in August,¿ Carl Feldbaum, president of BIO, said. ¿The circumstance that required us to take action were the connection between the tax cut and the Medicare drug benefit. That went from being the big dog to being the big tail on the tax-cut dog.¿

BIO hasn¿t supported any proposal to date. However, the organization doesn¿t support a plan that provides a minimum benefit to the most seniors. Feldbaum maintained that any plan should take care of the sickest seniors who need financial assistance the most before extending new benefits to the ¿Ross Perots and Lee Iacoccas¿ of the nation.

In addition, BIO balks at anything that smacks of price controls, which would impede the money needed to produce the most innovative biotechnology drugs. The president¿s provision to rely on HCFA to establish prescription drug benefit coverage gives the organization pause.

¿In the end, it¿s not the Republicans and Democrats that have the most at stake here,¿ Feldbaum said. ¿It¿s the senior citizens and the biotechnology industry that has the most at stake.¿