Clinton urges Medicare drug benefit

WASHINGTON -- President Clinton is greeting with cautious optimism a pledge by drug makers to cooperate on a new Medicare prescription benefit for older Americans, saying the companies must follow it up with action.

''I take their offer in a positive way, and I just hope they'll come and sit down with us,'' Clinton said Friday. But he said his worries about high drug prices, which have raised industry fears of price controls, remain.

''I think what they're worried about is the fact that if the government becomes a big buyer that we'll be able to bargain for lower prices at greater volume. I don't think that's a bad thing,'' the president said.

Drug industry leaders told administration officials at a White House meeting Wednesday that they want to try to find a compromise on a Medicare drug benefit.

There is no indication that the companies are changing their fundamental position, which has been to support improved drug coverage for the elderly through the private sector, not directly from the government. The industry worries that a government-run program could lead to price controls.

They said Friday for the first time, however, that they would be willing to support drug-coverage legislation separate from a wholesale redesign of Medicare in which more senior citizens would get all their health care through private health plans.

Clinton has proposed having the government run a Medicare drug benefit by contracting with the same drug-purchasing management firms used by many private health plans.

''We continue to have very serious concerns ... about the president's plan,'' said Alan Holmer, president of the Pharmaceutical Research and Manufacturers of America, who was at the White House meeting.

Industry leaders pledged to tone down rhetoric against the administration's proposal, including commercials featuring an elderly woman named Flo who insists on keeping the government ''out of my medicine cabinet.''

''In terms of our advocacy, including any advertising we might be involved in, we intend to be very positive and constructive in our support of bipartisan solutions,'' said Holmer.

Whether Congress and the White House can agree on the design of a Medicare drug benefit and enact it this year remains doubtful. Congress has a shortened session, and the two political parties will emphasize their differences as elections near.

''The outlook for Medicare reform in 2000 remains almost as cloudy and overcast as before the statement put out by the pharmaceutical industry,'' said Marty Corry, lobbyist for AARP, the nation's largest organization of older people.

Many consider the failure to cover drug costs for patients who are not in hospitals is a serious gap in Medicare, the nation's health insurance program for the elderly and disabled.

There is growing concern that senior citizens are being left behind as more new drugs to treat diseases of aging are introduced, but prescription costs are rising by more than 15 percent a year.