Medicare Compliance & Reimbursement

So far, House and Senate bills being drafted to add a prescription drug benefit are "clearly within the range of acceptability," Centers for Medicare & Medicaid Services Administrator Tom Scully told reporters May 29.

While couched in caveats of fragmentary knowledge and unfinished products, Scully's comments suggest that President Bush's eagerness to sign a bill could overcome his desire for an overhaul that pushes beneficiaries towards private preferred provider organizations by offering better benefits to seniors willing to abandon fee-for-service Medicare. This approach has met with skepticism on the Hill, particularly from legislators of both parties representing rural parts of the country - many of whom hold seats on the Senate Finance Committee, which has jurisdiction over Medicare in the upper chamber - who saw Medicare+Choice plans shun their constituents despite repeated efforts to draw the plans into rural areas. Finance Chair Charles Grassley (R-IA) and other panel members have signaled a willingness to accept only a small degree of differential benefits.

Scully made his comments in response to questions concerning whether House Ways and Means Committee Chair Bill Thomas's (R-CA) Medicare plan would satisfy the administration. In recent years, the House has passed Thomas-authored plans featuring drug-only insurance -which the administration earlier this year deemed an unacceptable option - rather than the comprehensive PPO approach. And Ways and Means staffers have repeatedly made clear this spring their view that bringing PPOs into rural areas is likely to be prohibitively expensive.