MSAs: Coming Soon to Selected Seniors

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WASHINGTON, D.C.: The Clinton Administration opposes the renewed GOP push to use medical savings accounts to bolster Medicare's finances, but at a meeting Tuesday with GOP leaders, President Clinton agreed to go along with a test run of the plan. As part of a proposal to reduce projected Medicare spending by 12 percent over five years, House Republicans wanted to establish accounts for all 38 million Medicare recipients, on the premise that patients faced with the opportunity to salt away money they don’t spend on medical care will spend less of it. Tuesday’s compromise: a test program covering 500,000 people. Most Democrats are deeply suspicious of the plan's supposed windfall, arguing that only those who have money can afford to save it. ""Their program attracts only the well-off," said Dick Gephardt, "while the sicker and poorer people are left behind." The cost of treating those needier patients, opponents contend, will quickly drive up Medicare premiums when healthier seniors are allowed to squirrel away unused Medicare funds. To make sure that the test is meaningful, the White House promises to make sure the pilot program enrolls a representative slice of Medicare recipients.