WASHINGTON- Maryland health advocates fear President Bush’s State of the Union promise for improved health care, including prescription drug coverage for senior citizens and tax credits for the uninsured, will be an empty one.
Those advocates said they were “particularly encouraged” to hear the president put Medicare prescription drug benefits on the national agenda, but they think there will not be enough funding to make it affordable for low-income senior citizens.
“What he put in the budget request is way short of what would be needed to accomplish that task,” said Frank Bailey, the director of AARP Maryland.
Health advocates are even less optimistic about the tax credits for the uninsured that President Bush announced in his speech Tuesday.
Details of the plan will not be available until the president’s budget is released this week. But Bush has talked in the past about “modernizing” the Medicare program by requiring that Medicare beneficiaries receive credit that they could use toward the purchase of private prescription drug coverage.
But if a prescription drug coverage program is enacted, there would probably not be enough federal money allocated to make the program affordable for the low-income seniors who need it, said Michael Lachance, legislative liaison for the Maryland Department of Aging.
Last year the Congressional Budget Office reported prescription drugs for the Medicare population would cost $1.5 trillion over the next 10 years, he said.
“Who knows how much a private insurance benefit would cost?” he asked. Even if it was affordable for seniors, Lachance said he does not think the private market wants to provide the elderly such a program anyway.
“Prescription drug coverage is a federal responsibility and should be handled through the federal Medicare program,” Lachance said.
He said that more than half of the 600,000 Medicare beneficiaries in Maryland do not have adequate pharmacy coverage and 31 percent have no prescription drug coverage at all. Since the details of the plan have not been released, however, its effects on the state’s Medicare beneficiaries are unclear.
Bailey said the $190 billion the president is expected to propose next week for Medicare reform and prescription drugs will not be sufficient. Last year, lawmakers considered allocating $300 billion to start a prescription drug coverage program.
“Even that is too low, but it’s a start,” Bailey said. “We need to work on Congress to allocate at least what they proposed last year.”
Otherwise the premiums will be too high, he said. “It would be out of reach of the people you’re trying to get into the program,” Bailey said.
Another prong of Bush’s health plan, which calls for tax credits for the uninsured, is a “terrible proposal,” advocates say.
Leighton Ku, a senior fellow at the Center on Budget and Policy Priorities, said the president is expected to propose $1,000 tax credits to help uninsured people buy health insurance from the private market.
“It has primarily been directed to helping people buy individual health insurance instead of providing them Medicare and Medicaid,” Ku said.
The measure is aimed at satisfying conservatives who “like to see tax cuts . . . and liberals like health care benefits,” but Ku said tax credits would not help those who need health care most and could weaken employer-sponsored coverage.
“The average price to buy health insurance for a low-income family is $7,000 to $8,000,” Ku said. “The tax credit provides a $2,500 to $3,000 relief, so health insurance still remains unaffordable.”
Ku noted that health insurance is cheapest for young, healthy men and most expensive for the elderly, who often cannot afford the high rates or cannot qualify for coverage at all.
“The government needs to offer one flat rate,” Ku said. “Otherwise young, healthy people will drop their employer-sponsored insurance for the tax credits and then employers will stop offering health insurance.”
Steve Hill, of the Maryland Budget and Tax Policy Institute, agrees tax credits will only help some people and not help the ones who need it the most.
“It would have negligent impact on lower-income workers who’ve lost their jobs,” Hill said. “It won’t help people who can’t afford health insurance.”
Hill said Maryland would benefit more from a bolstered Medicaid system that would let the state provide coverage to more people.
“If a person has two kids and makes more than $200 a month, in Maryland we say, `You’re too rich to qualify for health insurance for low-income people,'” Hill said.
For a low-income parent to qualify for Medicaid coverage in Maryland, they cannot make more than 40 percent of the poverty level, Hill said.
“It might be nice if the federal government provides some fiscal relief to states so we can provide Medicaid coverage to more people,” he said.