Update on Congress - March, 2000 Update on Congress is published each month Congress is in session to keep advocates abreast of legislation affecting seniors and related events in Washington. The National Committee to Preserve Social Security and Medicare hopes this information will be useful when you talk with your lawmakers and other opinion leaders. The annual ritual of lawmakers on Capitol Hill wrangling over a new federal budget began in earnest. Both Congress and the White House are in play in the fall elections, so this year's fiscal wrestling match is hard fought. Each side is looking to "pin" its opponents for partisan advantage. The first-round bell sounded with the unveiling of the administration's fiscal 2001 budget. The president again is proposing to let people 55 to 65 buy health coverage through Medicare. More people are retiring early. At the same time companies are jettisoning retiree health benefits. And it is getting more difficult for early retirees to find private companies willing to insure them. This year, the White House is proposing new tax credits that would offset 25 percent of the buy-in cost-making this year's proposal much more affordable than earlier administration plans. The administration's budget devotes a major portion of the anticipated federal surplus to extending Medicare's solvency, providing a prescription drug benefit and establishing a reserve fund for the costs of covering catastrophic drug needs. Of the $746 billion non-Social Security surplus, which the Office of Management and Budget projects over the next 10 years, the White House plan earmarks more than half to bolstering Medicare's long-term solvency. The White House says these provisions would extend the life of Medicare's trust fund by at least 10 years, to 2025. The plan also sets premiums for a proposed drug benefit at $26 per month in the first year, with no premiums for low-income beneficiaries. The drug benefit would be voluntary and universal. The plan has no deductibles and would pay for half of each beneficiary's drug costs, with a cap of $2,500. By the time drug benefit is entirely phased in 2008, the premium would be $51 per month and the cap would be$5,000. Also proposed: a $35 billion catastrophic fund for 2006 to 2010 to help beneficiaries with extremely high prescription drug costs. Meanwhile, the current deductible and copayments for preventive Medicare services would be eliminated; this would include colorectal cancer screening, bone mass measurements, pelvic exams, prostate cancer screening, and diabetes self-management benefits. The administration's Social Security plan sets aside surplus FICA taxes in their entirety for the foreseeable future, applies them to paying down the national debt, and credits the Social Security trust funds with the resulting savings on federal interest payments. The debt would be paid off in 2012. This could extend Social Security's solvency to at least 2050, the administration calculates. The interest savings alone would total $99 billion in 2011 and grow to $205 billion in 2016, say Social Security actuaries. These and other Medicare and Social Security proposals will come under intense congressional scrutiny before the April deadline for Congress to pass a budget resolution. You may review more fully these budget plans on the White House's website at: http://www.whitehouse.gov/WH/New/00Budget/ There is always hope that this year Congress might be galvanized into bipartisan action on these critical health and retirement issues. The Medicare drug benefit issue heated up recently when a spate of congressional hearings were held in the Senate Special Aging Committee, the House Ways and Means Health Subcommittee and the House Commerce Committee. Hearings pitted the administration's proposal to add drug coverage as a core benefit to the current traditional Medicare program against a proposal offered by Sen. John Breaux, D-La., and Sen. Bill Frist, R-Tenn., that would have Medicare beneficiaries shop around for high-end prescription drug-inclusive plans from private insurance companies. Activists, please contact your lawmakers and urge them to support a universal, voluntary prescription drug plan under Medicare. Also urge your lawmakers to support H.R. 723, the Prescription Drug Fairness Act, which would provide seniors access to pharmaceuticals at reasonable prices. A bill to eliminate the Social Security earning limitations overwhelmingly passed the House, 422-0. National Committee President Martha McSteen urged lawmakers to repeal the Social Security earnings limitation at a hearing before the House Ways and Means Social Security Subcommittee. The limitation penalizes workers 65 to 69 by reducing their Social Security benefits $1 for every $3 they earn over a yearly limit. In 2000, that limit is $17,000. Last year, almost 800,000 retirees in this age group lost some, or all, of their Social Security benefits, simply because they wanted-or needed- to keep working after 65. Enacted during the Depression, the earnings limitation was intended to discourage older workers from returning to or staying in the workforce, primarily because of the nation's record-high unemployment rate. But today, these conditions no longer exist. Many seniors-especially low- and middle-income seniors-need this extra revenue to pay for rising medical and prescription drug costs. No senior should be forced to choose between buying their medications or paying rent or buying food. Activists, please contact your senators and urge them to support and co-sponsor legislation to repeal the unfair earnings limitation. At a recent press conference on Capitol Hill, several House members were joined by National Committee members and supporters as the lawmakers signed a discharge petition regarding the price of prescription drugs. The petition would force Congress to consider H.R. 664, a bill to provide a substantial reduction in the price of prescription drugs for Medicare beneficiaries. The bill is currently languishing in both the House Commerce and Ways and Means Committees. When 219 signatures are collected, the bill will automatically move to the House floor. Activists, please contact your lawmakers and urge them to support H.R. 664, a bill to provide affordable prescription drugs for Medicare beneficiaries. Also, ask them to sign on to the discharge petition to move H.R. 664 directly to the House floor. Activists, also urge your lawmakers to support S. 717 and H.R. 1217, government pension offset reform legislation. The bill would affect those government pensioners who are at risk of losing part of their Social Security benefits because of the offset. This proposal would eliminate the offset for combined benefits up to $1,200. The two-thirds offset would only apply beyond this threshold, which in subsequent years would be indexed for inflation. The House bill currently has 196 co-sponsors; the Senate bill, 16. This is the best level of support the bills have enjoyed since their inception. We urge you to call our Senior Flash line at 1-800-898-0180 to get weekly updates and to register your opinions. Would you prefer to get Update on Congress via e-mail? 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