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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: puborectalis who wrote (157561)	7/3/2001 11:01:54 PM
From: puborectalis	Read Replies (2) \| Respond to of 769667

Budget Chairman Warns of 'Raid' on Medicare Funds By Todd Zwillich WASHINGTON (Reuters Health) - The cost of the recently-passed $1.3 trillion tax cut along with projected shortfalls in the government's revenue stream mean that Congress will have to start spending money from the Medicare Trust Fund "this year," Senate Budget Committee Chair Kent Conrad said Tuesday. Conrad attacked President Bush and Congressional Republicans for the size of the tax cut, saying it would force them to take money from Medicare in order to pay for defense spending and other programs. White House officials have repeatedly said that they will advocate spending Medicare money only for the Medicare program. The Medicare Trust Fund holds money for Part A of the program, which pays mostly for hospital services for Medicare's 39 million elderly and disabled beneficiaries. Recent Congressional estimates put this year's total budget surplus at $275 billion. About $184 billion of that is set aside automatically for Medicare and Social Security, leaving $92 billion in surplus left over. But subtracting $74 billion in reduced revenue to cover the first year of the 10-year tax cut and $12 billion for other budget priorities and interest leaves $6 billion of available surplus, Conrad said. Chief White House economic advisor Lawrence Lindsey announced last week that the new estimates show that the government will take in some $56 billion less this year than Bush administration officials had projected back in January. Twenty-three billion of those dollars were not accounted for in May's estimates, meaning that when the $6 billion of available surplus is gone, Congress will have to take $17 billion from Medicare to make up the difference. "We face a raid on the Medicare Trust Fund this year," Conrad told reporters. Conrad stressed that the situation could be made worse by any further downturns in the economy that cut government revenues, or by extension to tax incentive programs already in place. "The raid on Medicare will be far more serious, far deeper, if those things occur," he said. Republicans maintain that the Medicare Part A Trust Fund is in good condition. "The Trust Fund as of now is in good shape for the near term," said Gail R. Wilensky, an economist at Project HOPE who advised President Bush on healthcare issues during the 2000 presidential election campaign. Wilensky said that Medicare's income is projected to exceed its expenses until the year 2016. She said that Lindsey's prediction of a $56 billion in federal revenue should not be enough to cause worry for Medicare since the economy is showing signs of strength. "To say that this concern is a little premature is putting it mildly," said Wilensky, who acknowledged that Medicare's solvency, even before baby boomers begin retiring, may be fragile. "If the economy slows down or expenditures speed up, you'll have to then make some decisions" about raising taxes or cutting spending, she said in an interview. Conrad said that he would call for hearings in the coming weeks to make White House officials explain how they will pay for their priorities without spending Medicare dollars. Copyright 2001 Reuters News Service. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.