Bush administration to look at costs of Medicare
President Bush said he plans to examine the high cost of Medicare after his administration disclosed this week that the prescription drug benefit would cost more than $720 billion over its first 10 years. The administration earlier pegged the cost at $534 billion.
"There's no question that there is an unfunded liability inherent in Medicare that Congress and the administration is going to have to deal with over time," said President Bush, who indicated he would address the issue after completing Social Security reform.
Democrats and Republicans might push for changes in the Medicare law before it takes effect in 2006. Possible cost-cutting changes for the Medicare law include capping spending for the benefit; cutting payments for wealthy beneficiaries; allowing the government to negotiate bulk drug prices with pharmaceutical firms; and legalizing the importation of prescription drugs from Canada and other countries.
Joshua Bolten, director of the Office of Management and Budget, told Congress on Wednesday that the administration will work with lawmakers to control the drug benefit's cost.