Point Man on Aging

By DOUGLAS WALLER

When the Democrats took over the Senate last June, Louisiana's senior Senator, John Breaux, became chairman of the Special Committee on Aging. A moderate, Breaux has become a key broker, bridging gaps between the White House and Congress on controversial issues like tax cuts, education and medical care. Earlier this month, he sat down with TIME congressional correspondent Douglas Waller to discuss issues affecting the elderly.

TIME: What demographic trends worry you the most over the next 20 years?

Breaux: The good news is that people are living a lot longer. And the bad news is that people are living a lot longer. You have 40 million seniors now. And you've got 77 million baby boomers who are right outside the window getting ready to be dumped into the Social Security program. You're rapidly approaching the time when you're going to have more seniors than teenagers.

TIME: As chair of the Aging Committee, what's on your agenda?

Breaux: We can take more time on this committee to look at problems like making long-term health care affordable and making sure that housing is going to be there for elderly people to live independently. We're going to investigate these scam programs that are targeting elderly people to get them to buy idiotic products. They advertise that if you buy these products, you can live to be 110 and have an active sex life and participate in the Olympics.

Another problem is having the medical profession prepare for all of these new seniors. Half of all of our patients are going to be over age 65, but less than 3% of our doctors have had any training in geriatrics. And only three of the 125 medical schools have geriatric training.

TIME: How should Social Security be reformed?

Breaux: People say fix Social Security but don't reduce my benefits; fix Social Security, but don't increase my taxes; fix Social Security, but don't increase my age eligibility. That's a pretty big challenge. One of the things a commission that I served on recommended was individual retirement accounts; carve out 2% of the payroll tax to allow people to invest. The stock market has never had a 20-year period of negative return.

TIME: But you have to be pretty savvy to play the stock market, and you can lose money. Is privatizing Social Security an option only for taxpayers who are well off and know how to play the market?

Breaux: The baby boomers are already in fact experienced in investing. They'll be much more comfortable with it than the current seniors. But they're not playing the stock market with this. The concept is to do exactly what is done for me in the federal employees' retirement plan. The only thing I have to do is check one of three boxes: whether I want to put my investments in a high-risk, medium-risk or low-risk account. That's the only decision I make.

TIME: How would you change Medicare?

Breaux: I'd change the whole thing. The whole program is a 1965 model that was good in 1965. But it's outdated, and it's micromanaged by Congress. You have to reform it fundamentally with a program that combines the best of what government can do with the best of what the private sector can do. I would allow people who want to stay right where they are in the current fee-for-service program to stay there, but create a new entity. It would be private insurance that would compete.

TIME: Critics say that would be great for the insurance companies. They could skim off the healthiest and wealthiest patients, leaving the Federal Government with the sickest and poorest.

Breaux: You'd have to guarantee that no plan can adversely risk-select their patients. And you can do that easily. That's why government still has to be involved in this. It's not just giving a senior a voucher and saying, "Go buy your health plan." It still would be government supervised, but not government micromanaged.

TIME: What's your answer to seniors who don't have affordable prescription drugs?

Breaux: Medicare should cover prescription drugs, but you have to reform the program. Prescription drugs would be provided through a competitive model. Again, that's what we have in the federal employees' plan. I have insurance that covers my prescription drugs. To give you an example, my father, who is on Medicare, and I walk into the same drugstore and buy the same prescription. The retail price of the drug is $100. My father will have to pay $100 because Medicare doesn't cover prescription drugs. But I get a volume discount in the federal plan, which will bring my retail price down to $70. And because I have insurance, I have a copayment of 50%. So the price is now down to $35. We want to give seniors that type of benefit.