WASHINGTON, Feb. 3 (UPI) -- Further proposed cuts to Medicare spending are expected when President Bush releases his fiscal 2007 budget Monday, Republican and Democratic congressional aides said Friday.
"On the budget, I think we probably have to look forward to a lot of Medicare cuts coming," an aide to a senior Democratic House lawmaker told reporters on condition of anonymity. "We're hearing big numbers."
Next year's budget request will come just days after Congress completed a protracted debate on a controversial bill that cut spending on Medicare, Medicaid and other programs by $39.5 billion over five years.
The bill passed the House by two votes and passed the Senate only when Vice President Dick Cheney voted to break a 50-50 tie. It was a narrow victory for Bush and Republican leaders who said the cuts were key to controlling entitlement spending.
Bush told Congress in his State of the Union address this week that he would move to pare entitlement spending as a way to help curb expanding budget deficits.
The president called for a commission to recommend long-term controls for Medicare, Medicaid and Social Security spending. That group wouldn't issue recommendations until well after November's mid-term elections.
But aides say Bush is unlikely to wait for the commission to propose some cuts.
Republican aides said Bush's election-year budget is likely to contain narrower cuts to Medicare. Administration officials and lawmakers could go after what they see as waste in the way the program reimburses for durable medical equipment like oxygen compressors.
The budget bill also avoided a scheduled 4.4-percent Medicare pay cut for doctors by sticking with 2005 spending levels. But those cuts are also likely to return in Monday's budget.
"We expect for 2007, physicians will probably be looking at another cut, probably on the order of magnitude of 4 percent, 4.5 percent," a Republican aide said.
Bush administration officials will fan out next week to defend the budget on Capitol Hill and around Washington. Health and Human Services Secretary Michael Leavitt is scheduled to testify in front of the Senate Finance Committee on Feb. 8.
This week Bush also proposed an expansion to tax-free health savings accounts as a way to drive down the overall cost of healthcare. Republican aides said they expect to begin talks on structuring tax cuts for the proposal soon after the release of the budget.
Still, some key Republicans have already expressed doubt about finding the money to pay for the accounts. Senate Finance Committee Chairman Charles Grassley, R-Iowa, told United Press International next week that HSAs were "needed policy" but that "the question is the capability of getting it done."
Democrats remain dead-set against the individual accounts, saying they will only give employers an excuse to end traditional worker insurance subsidies as costs rise. They point to now-common 401(k) retirement plans as an example.
"We tax-incentivized individual savings for retirement, and 'voila,' our pension system is gone," a Democratic aide said.
Meanwhile, House Republicans are likely to rewrite the bill governing the National Institutes of Health for the first time since 1993, a GOP aide said. The agency swelled with cash after Congress doubled its budget between 1998 and 2002, and now lawmakers want to "prioritize investments in NIH," a GOP House aide said.
The Republican-led Senate yesterday defeated a Democratic proposal to extend the May 15 deadline for seniors to sign up for the new Part D Medicare prescription-drug benefit. The amendment gained a majority of 52 votes but failed because of Senate procedures requiring 60 votes for passage.
Medicare chief Mark McClellan told lawmakers at a hearing Thursday that the Bush administration is fixing recent problems in the program's implementation without changes in the law.
But critical Democrats expect the problems to persist. A party House aide predicted that Congress would eventually be forced into extending the deadline so that seniors confused by the plan's complexity wouldn't have to pay penalties for late sign-up after May 15.
"Our expectation is it will probably happen but it won't happen until around May 10th," the House Democratic aide said.
