
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SUNDAY, August 13, 1995                   TAG: 9508140141
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A2   EDITION: METRO 
SOURCE: The Washington Post
DATELINE: WASHINGTON                                  LENGTH: Medium

PREMIUMS WOULD LEAP IN GOP MEDICARE PLAN

Monthly Medicare premiums could more than double for all beneficiaries and quadruple for those with high incomes under a revised version of a Republican plan to overhaul Medicare recently drafted by the staff of the House Ways and Means Committee.

The new document lists options for restructuring Medicare and carrying out a GOP plan to cut Medicare growth by $270 billion over the next seven years, an unprecedented reduction that is the most politically explosive and technically difficult issue facing Congress.

The committee memorandum, which was obtained Friday by The Washington Post, suggests far greater cost increases to beneficiaries than previous GOP proposals that have reached the public eye this summer. However, the documents offer only a snapshot view of what congressional sources depict as a continuously evolving range of options.

``No decisions have been made,'' said Charles Kahn Jr. the top GOP health staff aide on Ways and Means. Ari Fleischer, committee GOP spokesman, insisted the doubling of premiums described in the memorandum ``won't happen.''

Increasing those premiums, which help pay for the doctor care portion of Medicare (Part B), is one of the easiest means the government has to reduce its Medicare costs. Monthly premiums are now $46.10 per person and are set to cover about 31 percent of the costs. Under current law this will drop to 25 percent next year and a smaller percent later. The government pays the rest of the Part B premium cost from general revenues.

Under the GOP memorandum, the premiums would be raised. Four options are given - keeping them at 31 percent, raising them to 33 percent, 35 percent or - a new option - 50 percent. According to calculations by one expert, this jump would more than double premiums by the year 2002 compared with what they would be under current law.

In another new option, premiums for single people with income over $75,000 and couples with income over $150,000 would be increased enough to cover the full cost of their Part B entitlement, quadrupling their current rate to roughly $320 a month per person.

In addition, the $100 a year deductible beneficiaries must pay out of pocket on doctor bills before Medicare starts paying their them would be increased. Three options are given: $150, $200 and $250. Then it would be raised annually to keep up with inflation.

Republicans argue that major reductions in the growth of Medicare are the only way to save the medical insurance system for the elderly from a crippling financial disaster. President Clinton and many Democrats insist that the Republicans are merely trying to finance their proposed tax cut with the Medicare cuts and that much slower reductions in spending would be more effective.

by CNB