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Administration Dispenses New Rx Plan

Stunned by sharp criticism of its original plan, the Bush administration has crafted a new Medicare prescription drug proposal that would offer limited coverage to seniors enrolled in traditional Medicare.

Administration officials briefed Republican members of the Senate Finance Committee Thursday, a Senate GOP aide said Friday.

Under the plan, seniors enrolled in the traditional fee-for-service Medicare program would get a discount drug card that would offer some savings when buying prescriptions, the GOP aide said. Those seniors would also get catastrophic coverage, which means substantial government help would kick in when seniors reach very high drug costs.

Seniors who enrolled in private health plans or HMOs would get more extensive drug coverage under the new proposal.

The administration has been scrambling to recover from criticism of an early draft of its proposal that would have limited the drug benefit to only those who would leave traditional Medicare to join health plans administered by insurance companies.

That plan drew a sharp rebuke, even from Republican allies in Congress, who noted that 87 percent of senior citizens are enrolled in traditional Medicare. The rest participate in Medicare HMO plans that have been widely criticized for abandoning patients. Since the HMO portion of Medicare began in 1999, scores of plans have left areas complaining that they were not getting enough money to cover rising health care costs.

President Bush has said he wants to spend $400 billion over the next 10 years to overhaul the 38-year-old Medicare program and add a prescription drug benefit.

It was unclear if the new plan, expected to be unveiled in the next two weeks, would satisfy Republicans. Some still believed it did not go far enough, the aide said.

"They've made progress," the GOP aide said, but added that it was not as much as some members wanted.

"Members appreciate the president's personal action," the aide said. But added, "The Finance Committee will clearly address the issue of prescription drugs. The president's plan will be among the options."

The latest plan was being criticized by Democrats as well.

"This is not a compromise," said Sen. Edward Kennedy, D-Mass. and the leading Democrat on the Senate's health committee. "It's a hoax. It still forces seniors to abandon their family doctors to join HMOs to get the drug benefit they deserve."

"I hope the administration will go back to the drawing board and propose a benefit that works for seniors instead of just the insurance industry," Kennedy said.

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