Liar is as a liar does
Medicare drug benefit to cost $720 billion over 10 years
WASHINGTON (AP) — President Bush said Wednesday Medicare is next on the government's fix-it list because the health care plan for the elderly and disabled, like Social Security, is facing financial stress with the retirements of baby boomers.
New administration estimates released Wednesday showed that the Medicare prescription drug benefit will cost taxpayers $724 billion over its first full 10 years, far higher than earlier estimates and rekindling congressional ire over its price tag.
The new estimate exceeds earlier projections chiefly because the figure now covers 2006 to 2015, a decade when prescription coverage will be in effect the entire period. Earlier calculations ran from 2004 to 2013 and included 2004 and 2005, when the program was being slowly phased in.
"There's no question that there is an unfunded liability inherent in Medicare that Congress and the administration is going to have to deal with over time," Bush said. "Obviously I've chosen to deal with Social Security first and once we accomplish — once we modernize and save Social Security for a young generation of Americans, then it'll be time to deal with the unfunded liabilities of Medicare."
Bush noted that the prescription benefit that he signed into law last year doesn't take effect until next year.
"I'm convinced they'll have cost savings for our society," Bush told reporters during a meeting with Polish President Aleksander Kwasniewski. "And I know it'll make the life of our seniors better."
The figure — similar to a $720 billion figure administration officials used Tuesday — is in documents obtained by The Associated Press. When anticipated savings are not included in the calculation, the administration estimates the drug program's gross price tag over the period will be $1.19 trillion, the documents show.
The new numbers prompted outcries from Democrats. They say the White House low-balled cost estimates two years ago to win votes from conservatives when Congress narrowly approved the program, and created a program with benefits that are too stingy.
"An ethical cloud has hung over the Republican Medicare law since it was passed in the dark of night more than a year ago," said House Minority Leader Nancy Pelosi, D-Calif., who called the new figures "staggering."
She said Congress should hold hearings on the program's costs and pass new legislation "to hold down costs and give seniors the true benefits they deserve."
The $724 billion estimate includes the effects of savings the administration expects through 2014 from higher Medicare premiums, cost sharing by states and savings the program will create for Medicaid, the health insurance program for the poor.
When Congress narrowly approved the drug legislation in 2003, the administration told wavering lawmakers that the program would cost $400 billion, including expected savings. The White House revised the estimate to $534 billion just two months later, after the law was enacted.