American Morning - Transcript

SHOW: AMERICAN MORNING 07:00

HEADLINE: Bills to Change Medicare Could Go to Floor Today or Tomorrow

GUESTS: Sen. Mark Dayton, Sen. Lindsey Graham

BYLINE: Daryn Kagan, Jonathan Karl

HIGHLIGHT:
Karl reports on the bills to change Medicare that could go to a vote soon. Dayton and Graham discuss the bills and their views on Medicare reform.

BODY:
DARYN KAGAN, CNN ANCHOR: Bills to change Medicare could go to the floor of both the houses of Congress today or tomorrow. Some of the hottest debate has centered around the subsidy to help senior citizens pay for prescription drugs.

Jonathan Karl now has more on that.

(BEGIN VIDEOTAPE)

JONATHAN KARL, CNN CORRESPONDENT (voice-over): In a noisy Capitol Hill protest, liberal Democrats and their allies in organized labor promised a last ditch effort to defeat the Republican-backed prescription drug bill.

REP. CHARLES RANGEL (D), NEW YORK: They're trying to serve laced Kool-Aid to the American people to kill Medicare.

KARL: But as the president shores up support for his drug plan, he is also fending off attacks from conservative Republicans.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And whatever amount of energy and effort is required from the White House, we will provide it to get a bill done this summer.

KARL: The problem for the president is stiff resistance by conservative Republicans in the House, who are reluctant to support the creation of a big, new $400 billion federal program without first restraining the cost of Medicare.

UNIDENTIFIED MALE: And as I raised with the president myself, many of us are still struggling with the fact that this bill contains a universal drug benefit that will be an enormous new entitlement, an enormous new obligation of the federal government that our children and grandchildren will have to bear.

KARL: Speaker of the House Dennis Hastert has been pressuring fellow Republicans to support the president on the issue. He acknowledges it's not an easy task.

REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE: It's probably one of the toughest, most complex pieces of legislation that we've tried to put together in our lifetime.

KARL: As for Democrats, they are adamantly opposed to the House version of the bill, which includes a greater involvement of private insurance companies in providing Medicare coverage. But most liberals don't like the bipartisan Senate bill, either, even if their friend Ted Kennedy supports it.

UNIDENTIFIED MALE: Any Democratic senator supporting Senator Kennedy and/or supporting this legislation, we think, are dead wrong.

(END VIDEOTAPE)

KARL: The liberal Democrats who oppose this bill are urging Senate Democrats to vote no on it and take the issue into next year's political campaigns. That's something that's going to happen anyway, regardless of whether or not this passes or fails, because virtually all of those Democrats now running for president have already come out against this bill -- Daryn.

KAGAN: Jonathan Karl on Capitol Hill.

Jon, tuft.

This Medicare plan is expected to be OKed by the Senate, but the fight might not be over. Democratic Senator Mark Dayton of Minnesota and Republican Senator Lindsey Graham of South Carolina are with us from the Capitol.

Senators, good morning to you.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: Good morning.

SEN. MARK DAYTON (D), MINNESOTA: Good morning, Daryn.

KAGAN: Senator Dayton, I'm going to start with you.

You managed to slip something into this bill that is meant to give members of Congress a taste of their own medicine. Tell us about that.

DAYTON: Well, it would make the benefits that go to members of Congress the same as what we're going to vote for seniors and other Medicare beneficiaries. I hope it will bring the Medicare program up to the level we have, which is about twice as good in its coverage now. But if we fail to do that, then we will bring ours down to theirs.

KAGAN: And how do you think that'll go over, Senator Graham, with your coworkers there in the Senate and the House?

GRAHAM: Well, I think it got three votes, so it didn't go over too well. But I think the whole concept here is everybody being the same in market forces. How can you provide a benefit that's the same for everybody and pay for it and how does the market set prices?

Low income seniors do pretty well in this bill. About a third to 40 percent of Medicare eligible seniors will get 90 percent of their growth benefits subsidized. The middle income and higher seniors will have to have a 50-50 co-pay and they really won't get a benefit till they spend about $800.

So middle class seniors are going to be under whelmed. Low income seniors, I think, are going to be provided a great deal and I think utilization rates will go up tremendously. So I'm very skeptical of this bill. You can't be all things to all people and we're trying.

KAGAN: So you're saying that there has to be a gap because there's limited resources and a little bit of something is better than nothing at all?

GRAHAM: Well, Medicare has a $13 trillion unfunded liability. In English, that means...

KAGAN: Yes, English please.

GRAHAM: ... the obligations of -- yes. The obligations of Medicare in the future, we're $13 trillion short of meeting those obligations. This drug benefit adds a $4 trillion unfunded liability. You add the two together, Medicare obligations in the future are $17 trillion short of the money coming in, and that bothers me greatly.

KAGAN: All right, my eyes are glazing a little bit over that with those numbers.

GRAHAM: Yes, that's a lot of money we need, right.

KAGAN: Let me bring you back in here, Senator Dayton.

You're really feeling the pain of some of the seniors in your district. As I understand it, you've gone into your own pocket to help fund some of these seniors going over the border to Canada to buy drugs over there.

DAYTON: Right. I donated my salary to the Minnesota Senior Federation to bus trips to Canada. But that's not the solution for every senior, even in Minnesota, and not in America. It's to bring those prices here down to the prices that they have in Canada, because the Canadian government stands up for its citizens and negotiates these prices down. And this legislation we're going to pass does nothing to involve the federal government in bringing the prices down. And that's great for the pharmaceutical industry and their profits, but it's bad news for taxpayers who have to subsidize. It's also bad news for consumers of all ages who have to go buy these prescription drugs.

I do have to correct my colleague. It got -- my amendment passed 93-3. Only three voted against it.

GRAHAM: Yes, I'm sorry. I got that wrong.

DAYTON: That's all right.

GRAHAM: Yes, I'm sorry. Yes, I'm sorry.

DAYTON: But any amendment I had where all the Republicans voted in favor of it.

GRAHAM: Yes, I'm sorry.

KAGAN: Yes, you want to make sure you get that one right.

GRAHAM: That's one you've got to be careful on...

(CROSSTALK)

GRAHAM: It's too early in the morning.

KAGAN: You want to make sure you get that one on the record.

I'll tell you another thing that's kind of confusing here, perhaps even to viewers at home, is the politics of all this. Isn't this a coup for the Republicans, taking away an issue that in the past has really been associated with Democrats?

GRAHAM: Well, I'm, I like President Bush very much. I don't know if I'll vote for this bill. There's no group up here representing young people and what I would like to do is help seniors who are struggling to pay for their drugs. Medicare, we'll cut your leg off if you're a diabetic, but we won't pay for your insulin. Medicare needs to be reformed. A prescription drug benefit is good preventive medicine. We need to modernize Medicare.

But we're doing it in a way that I think just adds to the burden of future generations. The hard decisions are not being addressed. We've increased eligibility for Social Security to 67 out because people are living so much longer. A third of the young women born this year will live to be a hundred.

Means testing, I don't think I should pay the same premium as my aunt and uncle, who worked in the textile industry in South Carolina. I would like to see wealthier seniors pay more into the system to shorten this $17 trillion gap.

Those decisions won't be made and somebody some day is going to have to make them and I'm not so sure that we're doing a very good job for the future generations of America and we're going to under whelm middle class seniors when this bill is really looked at closely.

KAGAN: Well, there are a lot of people out there who are hurting and a lot of people doing the math at their kitchen table.

GRAHAM: That's right.

KAGAN: They will make the final decision.

Senators, thank you for getting up early on this morning.

GRAHAM: Thank you.

KAGAN: Appreciate your time.

DAYTON: Thank you.