Changes in Medicare, Schip Pit AARP, Doctors Against Insurance Companies

WASHINGTON (AP) _ Call it the health insurance companies and nursing homes versus doctors and the AARP, a classic, inside-the-Beltway struggle that erupted when House Democrats sought changes to Medicare.
Publicly, all sides trumpeted their concern for older people in the United States and scarcely mentioned their own financial and political self-interests, if at all.
Together, they have spent millions on lobbyists, television ads and polling to influence lawmakers. They stand ready to renew the battle this fall, all the while previewing possible lines of attack for the 2008 elections.
_``The bill preserves access for Medicare patients and lowers seniors' out of pocket costs,'' the American Medical Association and AARP said in ads endorsing the Democrats' bill.
Not mentioned was that the legislation would put $65 billion more into doctors' pockets over the next decade. Or that AARP, which has 39 million members over age 50, was eager to court favor with Democrats newly in control of the House.
_``Three million seniors could be pushed out of their Medicare Advantage plan, while millions more will have to pay higher out-of-pocket costs for health care and lose important benefits they depend on,'' the American Health Insurance Plans countered in their ad opposing the bill.
Left unsaid was that the measure would cut $157 billion over a decade from planned payments to the companies that operate Medicare health maintenance organizations under the Medicare Advantage program.
_``Slashing billions could jeopardize quality, threaten thousands of health care jobs and return Medicare funding to levels of almost a decade ago,'' two nursing home groups said in ads that angered top Democratic lawmakers.
No word, however, that payments to the nursing homes would drop by $6.5 billion over a decade. The commercials were financed by the Alliance for Quality Nursing Home and the American Health Care Association.
The flash point for the high-dollar struggle was a complex bill that passed the House with two separate, largely unrelated halves.
One included an expansion of health insurance for lower-income children, largely paid for with higher tobacco taxes.
The second made numerous multibillion-dollar changes in Medicare, which covers about 43 million elderly and disabled people. The largest change took $157 billion from private plans that Republicans long nurtured as an alternative to the traditional government-run program.
Democrats wanted to use much of that money to raise Medicare fees to doctors, who otherwise face a 10 percent cut on Jan. 1., and provide more aid for lower-income beneficiaries.
Ultimately, Democrats broke their bill in two and temporarily sidetracked the Medicare changes.
The children's health care issue is now at the center of a veto struggle between Congress and the White House. To the irritation of the administration, the interest groups that parted company over Medicare are virtually unanimous in supporting expanded kids' health insurance.
Still, the maneuvering over Medicare has been a quiet presence in recent weeks and is certain to flare when Democrats turn anew to the issue.
In the interim, some Democrats strategists express concern that vulnerable lawmakers needlessly exposed themselves to potential political harm by voting to roll back private Medicare, only to have the measure sidetracked.
Rep. Steny Hoyer, the House majority leader, rejected that contention recently. ``I don't think we put any member at risk,'' Hoyer, D-Md., said at a news conference.
First-term Rep. Rep. Jason Altmire, D-Pa., attacked for supporting the bill, was satisfied with his vote afterward. ``You have to make tough choices to move the ball forward,'' he said, citing the need to prevent a cut in Medicare payments to doctors.
House Republicans previewed a possible campaign season line of attack. For a small amount of money, their campaign committee ran an ad in a weekly newspaper in Altmire's district. Older people ``could lose preventative care, face higher out of pocket costs for their stays and pay more for their prescription drugs,'' it said.
Said Altmire: ``I'm not excited politically for the opportunity for an opponent'' to use the issue.
Statistics compiled by the Center for Responsive Politics show that the health service/HMO industry has made more than $8 million in campaign donations from 2005-2006. Republicans got 60 percent of the money.
At its heart, the struggle over Medicare touches on ideology as well as politics.
Many Democrats vehemently oppose GOP-driven changes in Medicare in recent years that revitalized a private Medicare market for insurance companies.
More than 8 million older people are enrolled for private coverage, about 18 percent of the total Medicare population. The share is expected to rise to 22 percent by next year.
The government pays an estimated $112 on Medicare patients in private coverage for every $100 it spends on the traditional program. Critics say the private alternative is wasteful. Supporters argue it often provides benefits such as vision care that are unavailable in government-run Medicare.
House Democrats decided to eliminate that $12 difference gradually, assuming that many plans would disappear and people would return to government-run coverage.
Outside interests on both sides quickly enlisted Democratic strategists and lobbyists for help with the new majority.
United Health Group circulated a memo from prominent Democratic pollster Mark Mellman. ``A vote to cut Medicare Advantage will elicit major negative political consequences,'' he predicted. He added that 54 percent of Republicans, 66 percent of Democrats and 57 percent of swing independents believe that ``cutting Medicare is a very convincing reason to vote against a candidate.''
Democrats lined up groups in support of their bill.
No endorsement loomed as important as the one bestowed by the AARP. Polling consistently shows that older voters view the group as the most trustworthy source of information on issues such as Medicare and Social Security.
Backing the measure required something of a turnabout for AARP. The group infuriated Democrats in 2003 when it supported the Republican legislation that launched the Medicare Advantage program. More than a dozen lawmakers, aides and lobbyists said AARP officials made it clear privately their current goal was to aid Speaker Nancy Pelosi, D-Calif., and the newly empowered Democrats.
Drew Nannis, an AARP spokesman, said, ``Our position has not changed on wanting to level the playing field between private ... plans and traditional Medicare payment rates passed in the 2003 bill.''
For insurance companies and AARP alike, the fight is far from over. Democrats are determined to prevent the Jan. 1 cut in doctor fees, and they still must find money to cover the costs.