Fox News Network Your World with Neil Cavuto

November 5, 2003 Wednesday

HEADLINE: Interview With Charles Grassley

GUESTS: Charles Grassley

BYLINE: Neil Cavuto

BODY:
NEIL CAVUTO, HOST: Well, you want Medicare prescription drug coverage complete with higher Medicare premiums for the wealthy. Expand tax breaks then for those footing the bill, so kind of says Senate Finance Committee Chairman Charles Grassley who just might have worked out some middle ground.

Senator, good to have you.

SEN. CHARLES GRASSLEY (R-IA), FINANCE COMMITTEE CHAIRMAN: I'm glad to be with you, and thank you for your interest in this important issue.

CAVUTO: What does it mean now? This seems to open up the way maybe for this Medicare prescription drug benefit.

GRASSLEY: Well, I would say that we still have three very controversial issues that have to be worked out, and, next Monday and Tuesday, hopefully, those will be worked out, hopefully worked out like everything else we've worked out, been adopted at this point by consensus.

It's cost-containment, it's premium support and health savings accounts, and those things need to be worked out in a way that doesn't-makes sure a bill gets through the House of Representatives and don't lose so many votes in the Senate...

CAVUTO: Senator...

GRASSLEY: ... and we don't...

CAVUTO: Does that mean, sir, that part of this plan is that the more well-to-do would pay higher premiums, but the flip side would be they'd have essentially glorified medical savings accounts.

GRASSLEY: OK. You're really talking about two things.

Number one, there will be-it's already been some decision to have some means testing for Part B fee-for-service Medicare-the Part B is the doctor part-and to have that means tested for people above $80,000-a- year income.

But the other issue is medical savings accounts, which is an entirely different issue, and the one that I referred to as health savings accounts. They are needed for three reasons.

Number one, because there are some people that don't have health insurance that save for it, would have health insurance.

Then there are some corporate plans now that are beginning to have their employees pay a larger portion of their health-care costs, while tax- free health savings accounts would help fill that void.

And then lastly, when we develop this program for prescription drugs for seniors, between $2,200 out-of-pocket and $5,300 out-of-pocket, there's what we call the donut hole, and that will have to be paid entirely by the Medicare beneficiary...

CAVUTO: Well, let me ask you, Senator.

GRASSLEY: ... and-and medical savings accounts can be used for that void.

CAVUTO: OK. Now does the president like what you've proposed?

GRASSLEY: Without a doubt. He does, yes.

CAVUTO: So the president says would this fill the gap and get a Medicare prescription drug deal done.

GRASSLEY: Well, this is a very important aspect of getting a prescription drug deal done, but it's only one of three or four controversial issues left to decide, which will be done by next Tuesday.

CAVUTO: OK. Senator Charles Grassley, we appreciate you taking time out of your hectic schedule.

GRASSLEY: Thank you.

CAVUTO: Senator Grassley.