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Congress Sets Aside $40 Billion For Drug Benefits—Hospitals, HMOs Make Grab For The Cash Republican Congressional leadership announced that $40 billion would be set aside over the next five years to help low-income seniors pay for prescription drugs. While the news is welcome to seniors struggling to pay the high costs of their medications, before the ink was dry on the budget resolution, hospitals, Health Maintenance Organizations (HMOs), and other health care industries lined up for a piece of the action. House Speaker Dennis Hastert (R-IL) wouldn't rule out using some of the $40 billion for increasing reimbursements to hospitals, home health care agencies, and HMOs. Hastert continues to be one of Congress's top recipients of health care campaign contributions, collecting $113,000 from the industry for his campaign committees in the last half of 1999 alone. After Medicare spending dropped for the first time in its 34-year history, some health care providers won an increase in payments of about $16 billion last year. The Congressional Budget Office attributed some of the slowdown in spending growth to a crackdown on fraud by hospitals and other health care providers. The $40 billion budget for prescription drugs, however, would be modest at best. President Clinton's competing drug plan would spend $34.5 billion over three years. According to Marilyn Moon, an economist at the Urban Institute research group and a trustee of Medicare, “The administration's drug benefit is just getting started at $34 billion.” Under Clinton's plan the benefit would be available to all 40 million Medicare recipients rather than just low-income seniors. Source: “Hospitals See Medicare Pay Raise Where Others See Drug Benefit,” Bloomberg, March 15, 2000. “Congressional Republicans Seek $40 Billion Drug Benefit,” Bloomberg, March 13, 2000. “Health Care Generous to Hastert,” Jennifer Loven, The Associated Press, February 1,2000.
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