Newsmaker: John Breaux

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Don't expect much from Congress this year in providing a Medicare drug benefit or reforming Social Security, says John Breaux, one of the U.S. Senate's most influential members.

"Things like that have been superseded by Sept. 11th [and] the war," says the Louisiana Democrat, chairman of the Senate Special Committee on Aging and, as a member of the powerful Finance Committee, head of the panel's subcommittee on Social Security.

The focus on and costs of terrorism, Breaux tells the AARP Bulletin, combined with the midterm elections next November, dampen the prospects for resolving many important issues during this year.

So does the vanishing budget surplus. "We had $300 billion of the surplus set aside for prescription drugs," he says. "Since Sept. 11, it is not there anymore."

Though no action on a Medicare drug benefit is expected in 2002, Breaux says the issue will still stay on the front burner because it's "something that needs to be done," even if it means going into the red.

Breaux hastens to point out, too, that although the Social Security trust fund will be tapped to make up spending shortfalls in the shrinking surplus, older people needn't worry that the fund will be depleted.

Beneficiaries "will be guaranteed the amount of money that they're entitled to," says Breaux. "They're not going to be shortchanged even though this so-called lockbox has been clearly penetrated, and the surplus is no longer there."

Nor will the change in the government's financial fortunes hurt programs for older Americans like Meals on Wheels, transportation and adult day care, he adds.

Humanitarian merits aside, "anybody who tries to reduce adequate funding" for these programs is taking a big risk politically, Breaux says during an interview in a cramped temporary office, graced only by an American flag, on Capitol Hill. His usual quarters have been sealed since October, when anthrax was found down the hall in Sen. Tom Daschle's office.

Breaux, who was elected to the House in 1972 and the Senate in 1986, says the expected return to deficit spending for the next several years doesn't worry him.

"Deficits are not necessarily bad if they are not too large." And programs like Medicare will continue even in times of deficits, says Breaux, who has emerged over the years as one of the Senate's leading moderates. He is the leader of a centrist coalition of Senate Republicans and Democrats and is known for his ability to work effectively on both sides of the aisle.

Breaux favors considerably more private-sector involvement in the program than some other Democrats. He wants, for example, health insurers to compete for the right to provide prescription drugs to beneficiaries. But it's a hard concept to sell, he maintains, because "people are very afraid of any change."

And he still thinks private managed care is a viable alternative to traditional Medicare even though many HMO plans have pulled out of Medicare since 1998, requiring about 2 million beneficiaries to find new plans.

The reasons why the HMOs pulled out are a matter of debate, but Breaux blames low government reimbursement rates, which, he claims, "are not in keeping with reality."

He concedes that it will take some effort to convince beneficiaries that if they sign up for a Medicare HMO, it won't disappear. What's needed is a "really competitive system" that would offer beneficiaries a defined set of benefits at better prices.

The senator is also a longtime backer of private, or personal, accounts within Social Security, but he's disappointed that the president's Social Security commission is offering several options instead of a single proposal for bringing such accounts into the system. (See Social Security Panel Falls Flat.)

"If that's what they do," he jokes, "then they're acting like Congress—and we created them so they would not act like Congress. …If they come up with a whole slew of options, I don't know if that's any help or not."

In any event, Breaux says, it's important to "get something going" to shore up Social Security for the long run and to try to avoid cutting benefits or increasing taxes. Will the turmoil in the stock market put a damper on a private accounts plan?

As a practical matter, yes, he says, noting, however, that investing should be based not on one year of market returns but on the long haul. "There's never been a 20-year period when we've had a negative return," he says.

Breaux expects Social Security reform to be sidelined this year because Republicans want to avoid the controversial topic in the November elections.

"The last thing the Republicans want," he says, "is a suicide issue."

But he does see a chance for action on Social Security and Medicare in early 2003, after the elections.

"We can't continue to punt" on these issues, he says, "because we're fast approaching the fourth quarter, and it's time to score."

Breaux understands the urgency of addressing several issues that affect older people. His committee on aging will continue this year to assess the impact of baby boomers, who begin retiring in large numbers in 2011, on the health care system, housing and other areas. It will continue to investigate, he says, "everything from nursing homes to telemarketing scams."

Some of Breaux's priorities:

• Long-term care. The senator, who notes that his father is battling cancer and his mother-in-law lives in his home, will hold hearings on ways to improve long-term care. He supports a measure that would give a tax break to people who purchase long-term care insurance.

By doing this, he says, "you will in the long term save society a lot of money."

• Assisted living. Breaux says he'll continue to push for more of these facilities, which can save money for government and health insurers, and for standards to regulate them. He says a "lot of people in nursing homes [wouldn't] really need to be there" if they could go to an assisted living facility. He cites one major problem: "Nursing homes are a very strong lobby [that] generally tend to fight assisted living."

• Nursing home safety. Breaux plans a hearing on better ways to protect residents from abuse and neglect and to enforce nursing home regulations.

Yet it's problematic whether Breaux himself will be there to shepherd these and other issues through Congress after 2002 because he's considering a run for governor of Louisiana.

"I guess," Breaux says, "you would have to say, 'as [the Bulletin] went to press … he was truly undecided.' "