Victory for Bush as Senate passes $400bn health plan

In a resounding political victory for President George Bush, the Senate gave final congressional approval to a $400bn (£235bn) expansion of Medicare yesterday, including prescription drug coverage for the elderly and a larger role for the private sector.

After four days of haggling, debate and presidential arm-twisting on Capitol Hill, a final 54-44 vote sent the measure to Mr Bush, whose signature will enable the Republicans to lay claim to a traditionally Democratic cause as the 2004 election campaign opens.

The changes add up to the biggest shake-up for Medicare - the federal programme which helps older and disabled Americans - since its inception in 1965. Its supporters claim it ushers the scheme into the modern era.

Detractors say it is merely a costly sell-out to the drug companies and to HMOs, the privately run health care management groups, which the country cannot afford in an era of runaway budget deficits. Many economic analysts agree. Given soaring overall US health care costs, they put the total 10-year cost of the measure at $700bn or more, adding to a federal deficit expected to reach a record $500bn-plus in 2004.

Unarguably, however, it is a coup for Mr Bush, who has stolen one of his opponents' issues and made it his own - much as Bill Clinton trumped the Republicans when he embraced welfare reform before his 1996 re-election.

It is also a triumph for Bill Frist, the leader of the Republican majority in the Senate and once a practising surgeon. When he wrote prescriptions, Mr Frist said during the debate, he knew hundreds would never be filled because his patients could not afford them. This would no longer be the case.

Whatever the shortcomings of the bill, Republicans believe it will strengthen the party's appeal to older Americans, an ever growing part of the population which votes in disproportionate numbers.

Neatly outmanoeuvring the Democrats, the White House enlisted the support of the AARP, the powerful elderly people's lobbying group, which organised a powerful advertising campaign. Democrats who oppose the reform now have the tricky task of not appearing to oppose prescription drug assistance for the elderly.

Mr Bush claimed that the measure, which takes full effect in 2006, will halve the cost of drugs for the average Medicare beneficiary for a monthly premium averaging $35.

These figures are hotly contested by Democrat opponents. Senator Edward Kennedy said the bill would "dump seniors in the cold arms of the HMOs".