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House Panels Approve GOP Plan to Overhaul Medicare : Congress: Controversial proposal advances on straight party-line votes. Demonstration by senior citizens disrupts one committee meeting.


WASHINGTON — The House Ways and Means Committee on Wednesday approved a major Republican initiative to reduce spending on Medicare by $270 billion over seven years and move millions of elderly beneficiaries into health maintenance organizations and other managed-care systems.

The measure was adopted on a straight party-line vote of 22 to 14 amid highly partisan debate.

Both sides in the Medicare reform struggle used the final day of committee work on the bill to hone the arguments they will use when they take their case directly to the American people during the coming weeks of legislative fighting.

"The most important thing we're going to do here is save Medicare," said Rep. Sam Johnson (R-Tex.), who turned 65 on Wednesday, becoming eligible for the federal health program that serves 37 million Americans. "We don't need Medi-scare tactics," said Johnson, accusing the Democrats of frightening senior citizens by claiming they would face far higher bills under the GOP proposal.

But President Clinton will veto the bill, warned Rep. Benjamin L. Cardin (D-Md.), claiming that the GOP plan "will hurt our seniors." Democrats hammered away at their favorite theme--that the Republicans want to take money out of Medicare to pay for the $245-billion tax cut they promised in the "contract with America."

If the GOP plan becomes law, it would for the first time impose strict growth limits on Medicare, slowing the growth rate of spending from the current 10% a year to 6.5% annually.

A second key House committee, Commerce, added its endorsement of the plan late Wednesday night on a party-line vote of 27 to 22. The committee's work was delayed for about an hour earlier in the day when the session was disrupted by a demonstration staged by a group of senior citizens, including some in wheelchairs.

More than a dozen of the protesters were arrested by Capitol police after they demanded to be heard.

"What are you afraid of?" yelled Theresa McKenna of the Virginia branch of the National Council of Senior Citizens. "Why won't you let us speak?" She was later identified by House Republicans as a former professional staff member and spokeswoman for the seniors group.

The demonstrators criticized the Republican majority for not having held any hearings on the Medicare proposal. Members of the group also protested before the Ways and Means Committee last month.

The full House will vote next week on the GOP plan, which would engineer the most sweeping changes in Medicare since its creation in 1965. The Senate Finance Committee has approved a different version of the measure. The two bills will be blended and placed into a giant legislative package that includes changes in Medicaid--the federal-state health program for the poor--and the GOP tax-cut proposal as well as other key Republican initiatives.

Medicare has become the key budget battleground for Clinton and the Republican majorities in the House and Senate. The $270 billion in Medicare savings is the largest single component of the GOP plan to balance the federal budget by the year 2002.

Democrats insist that number is too large, and they offered their own package of $90 billion in savings, with all the reductions coming from reduced payments to doctors, hospitals and other health care providers. The Ways and Means Committee rejected that plan by a vote of 22 to 14, following party lines.

Democrats say their smaller package would provide enough money to add another four years of solvency to Medicare's hospital trust fund, which is scheduled to run out of funds in 2002 at current rates of spending. The GOP says its plan would assure solvency until 2011, when the first of the huge baby boom generation becomes eligible for Medicare benefits.

A key part of the GOP success was the enthusiastic support for the Medicare plan by freshmen Republicans.

"Our proposal is specific, it's realistic and it expects sacrifice from everyone," said Rep. Jennifer Dunn, a freshman Republican from Washington. "My parents and their friends who are seniors would never forgive me if I did not do my best to save Medicare."

The bill adopted Wednesday would:

* Increase Medicare premiums for Part B coverage of doctor bills, now $46.10 a month, to about $90 by 2002 for all beneficiaries. An additional premium would be charged to those individuals with annual incomes over $75,000 and couples with more than $125,000 in income.

* Provide an annual open enrollment period, allowing beneficiaries to choose among HMOs and other health plans. The federal government would pay the premiums. Beneficiaries would be free to remain in the current fee-for-service Medicare system, which has an unrestricted selection of doctors and hospitals.

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