Political Animal


June 20, 2012 9:15 AM The Long-Forgotten Medicare Expansion of 2003

By Ed Kilgore

You know you’re getting old when Matt Yglesias can take you on a stroll down memory lane. But that’s what he did in a post late yesterday, amplifying the discussion of partisan flip-flops that another former wunderkind, Ezra Klein, began:

[T]he most interesting flip-flop isn’t about ObamaCare, it’s about the exceptional moment in 2003 when George W. Bush and the Republican congressional leadership—including current tightwad-in-chief Paul Ryan—whipped votes in favor of what was, at the time, the largest expansion of the welfare state since Lyndon Johnson was in office. That was the creation of a prescription drug benefit for Medicare. The legislation was, in many ways, a like something straight out of the DC compromise blueprint. The basic idea was to do something Democrats wanted to do—make Medicare benefits more generous. But it was structured so as to be very favorable to pharmaceutical companies and insurance firms. And the pot was sweetened by including substantial money to faciitate seniors opting out of Medicare and into subsidized private plans. Republicans made a giant exception to their aversion to spending money on non-military matters for this, and it wasn’t paid for by offsetting spending cuts or tax increases. Only two Democratic Senators ended up voting for it, but at the same time Democrats didn’t filibuster it to death even though they had the votes….
And in an odd coda, the bill’s passage was integral to the birth of the Affordable Care Act. That’s because the deficit-financed subsidies to private insurers inside Medicare became offsetting spending that Democrats could cut in order to make ObamaCare deficit neutral. If the Bush administration had never created that program in the first place, Democrats wouldn’t have been able to cut it later on and use those savings to finance their own health care bill. They’d have either had to write a much stingier program or else include substantially more in the way of tax hikes. And yet even though the 2003 Medicare bill was controversial at the time, it seems to have basically been eliminated from memory. Now all good Republicans are against spending money on anything, but nobody proposes to repeal the basic benefit. It’s as if the whole thing never happened.

This last observation is off a bit. It’s a token of the rightward shift of the GOP that Rick Santorum did in fact get heat during the current presidential cycle for voting for Medicare Part D. And it’s equally significant that he acknowledged that vote as a mistake (rationalizing it partially because it included a boost for conservatives’ favorite health policy pet rock, Medical Savings Accounts, and also included the privatized Medicare Advantage program that Matt talks about). Santorum aside, the standard conservative litany about the betrayals of conservatism conducted under the Bush administration usually mentions Part D along with No Child Left Behind and Bush’s futile support for comprehensive immigration reform. Still, it’s true no one is talking about repealing Part D, either; it’s simply become too popular with the GOP’s base of elderly white voters (not to mention Big Pharma).

So even as Republicans talk endlessly about “entitlement reform” and runaway government spending, they come at the most fiscally troubled and the most popular of “big government programs”—Medicare—crabwise, grandfathering current and near-term beneficiaries and eating away at benefits over time through vouchers, instead of directly confronting the program and lopping off the most recently enacted benefit, Part D. It’s another example of the strange psychology of a party that simultaneously proclaims itself the champion of regular folks against “elites” (and for that matter, of Medicare beneficiaries as opposed to the welfare bums receiving help from Medicaid or ObamaCare) while disguising its ultimate intentions from its own voters.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.


  • c u n d gulag on June 20, 2012 10:05 AM:

    The whole point of that budget-killing Act was to take the older voters minds off Bush's incompetency, and his administrations stupid and costly wars and occupations, and give the oldsters a bright and shiny object to look at, to help get W reelected in 2004, and which was also the greatest gift Big Pharma ever got - non-negotiable prices; and also gave the gift of donut holes to the Health Insurance companies.

    ALL off budget!

    And now, they whine, shriek, wail, bellow, tear at their hair and at their clothing, bitching about ACA - which will actually SAVE some feckn' taxpayers money.

    Conservatism is a deeply serious mental disease, which causes its victims to look like "Whirling Dervishes," in an endless series of 180's, to constantly be against anything and everything someone to the left of The John Birch Society.

    I'm frankly amazed, sometimes, that their heads haven't popped-off!
    Mine's about to, just watching them!

  • c u n d gulag on June 20, 2012 10:08 AM:

    Ooops, that first paragraph sho

    "...and also gave the gift of donut holes to them and Health Insurance companies."

    Y kent oui haz "Edit," lyke dee groanops dew?

  • Peter C on June 20, 2012 10:32 AM:

    There are many ways to break something, and during the Bush administration, Republicans tried them all.

    It was ASTOUNDING that those who 'love the free market' would have set up a system where the buyers have no bargaining power. It's a system which elementary economics says is CERTAIN to increase prices.

    But itt wasn't a bug; it was a feature.

    Step One: Get installed by your daddy's pals on the Supreme Court.
    Step Two: Doom Medicare to uncontrolled costs (funnelling lots of cash to your buddies in the Pharmaceutical industry) by ramming through Medicare part D after a record long 'vote', kept open until political pressure gets you the votes you need.
    Step Three: Decry the unsustainability of Medicare.
    Step Four: Wreck the economy while a Democrat is in office.
    Step Five: Turn Medicare into a coupon system (the Ryan budget).
    Step Six: Phase out the coupons.
    Step Three:

  • boatboy_srq on June 20, 2012 11:04 AM:

    For all the whinging from the Reichwing about the ACA, I haven't heard a peep about this particularly boneheaded item.

    For example, why hasn't someone asked a non-pResidential-candidate why they oppose the ACA but voted for Medicare D? Why, if the budget and "deficit spending" are such a big deal, didn't Medicare D get funded up front and killed if the $$$ couldn't be found? Nobody seems willing - not even the "liberal media" - and there are plenty of Congresscritters who were part of that process who are now whinging about the deficit and government "overspending" and "overreach." If the fiscal concerns are this severe (and have been at intervals - coincidentally, intervals when a Dem has been POTUS) then the original Medicare D logic was flawed and should be revisited.

    I know all this has been said before. But it bears repeating: if the problem with ACA is the expense, then Med D should never have been implemented; converseley if Med D was OK without a funding stream, then ACA should be ok one.

  • Lifelong Dem on June 20, 2012 11:42 AM:

    Um, Republican Congressman John Shimkus of Illinois actually mentioned Medicare Part D during the debate on the ACA. At least he did on twitter. He tweeted that the the prescription drug program was actually costing less than originally estimated. He called this a REAL SAVINGS for the American people!

    There is no turd that the GOP won't try to convert into a diamond. Or as Captha says, "furthfu upon."

  • N.Wells on June 20, 2012 1:12 PM:

    As others have said, it served to buy off the elderly and help Bush get re-elected, but it also A) gave massive amounts of public money to Republican-friendly drug companies, and, even more importantly, helped bankrupt the government to justify all the wailing and moaning and cutting of social programs going on. It was an R trifecta that not enough Democrats stood up and screamed bloody murder about at the time.

  • Ray Waldren on June 20, 2012 3:29 PM:

    And remember how the donut hole came to be? First the Repugs suggested that the Dems were badmouthing the program by bringing up something that wouldn't happen.

    Then later the Repugs explained that "only a few" seniors would even have to worry about it. And that those that did wouldn't be inconvenienced. It was also suggested that seniors were aware of it and were made of sterner stuff.

    I think the number of seniors that became inconvenienced by the donut hole was a complete shock to most of the Repugs -- talk about voting for something that you don't know the full ramifications about.

  • jhm on June 21, 2012 6:18 AM:

    Am I missing something or wasn't this the $500 bn "cut" in medicare that Dems were coshed with (abetted by a characteristically docile media)?