* Tells fellow liberals reforms can protect, improve health
* Says taxes are not the only way to curb the deficit
* 'Fiscal cliff' talks should not include Medicare, Medicaid
By Kim Dixon and Thomas Ferraro and David Morgan
WASHINGTON, Nov 27 Dick Durbin, a senior Senate
Democrat and close ally of President Barack Obama, urged fellow
liberals on Tuesday to consider reforming Medicare and Medicaid,
the U.S. healthcare programs they have long fought to shield
from spending cuts.
The timing of his message - just as Democrats and
Republicans struggling to avoid the "fiscal cliff," looming
early next year - and its prominence may signal that Democratic
leaders and the White House will discuss social programs at the
fiscal policy negotiating table.
"Progressives should be willing to talk about ways to ensure
the long-term viability of Medicare and Medicaid," which help
pay for the care of the elderly and needy, Durbin said in
remarks to the liberal Center for American Progress.
Most Democrats have avoided talking about making changes to
Medicare and Medicaid, despite the rising costs of the two
programs, which are adding mightily to U.S. budget deficits.
Durbin has recently made other high-profile remarks about
reducing Medicare and Medicaid costs. Appearing on ABC's "This
Week" program on Sunday, he raised the possibility of Democrats
accepting Medicare reforms that would make higher-income seniors
pay more for their care.
Durbin said on Tuesday, however, that the debate over
Medicare and Medicaid should not be part of the solving the
immediate fiscal problem - the convergence of sharp tax
increases and deep federal spending cuts set for January.
Economists warn that going over this fiscal cliff could put the
U.S. into a recession.
Durbin has suggested a two-step process: avert the cliff now
and agree to a framework to find savings from Medicare and
Medicaid with the details to be worked out next year.
Obama and congressional Democrats want to raise income taxes
only on the wealthy and Durbin said liberals need to offer
concrete ways to rein in spending, as well.
"We can't be so naive to believe that just taxing the rich
will solve our (fiscal) problems," Durbin said.
Durbin repeated the Democrats' position that most tax cuts
enacted in 2001 should be extended, but tax cuts given to those
with income above $250,000 should expire. If Congress fails to
act, tax rates for all income groups will rise.
Republicans could block any bill that does not extend all
tax cuts, but this risks playing into Democrats' hands. After
Jan. 1, with all tax cuts expired, Democrats could draft a bill
that cuts taxes only for those earning below $250,000, cranking
up pressure on Republicans to go along.
One controversial proposal to shore up Medicare finances the
to raise the age at which seniors start receiving benefits.
Durbin said he was concerned that those with health problems in
the years before Medicare kicks in may struggle to get coverage.
Democrats say manual laborers and people with health
problems before eligibility age are at risk. Durbin cited his
brother, who had a heart attack before qualifying for Medicare
at age 65.
"My very conservative Republican brother, who had no use for
social programs, started counting the days until he was eligible
for Medicare," Durbin said.
"If anybody wants to talk about a later eligibility age for
Medicare, what I want to hear is the assurance and guarantee
that people like my brother will have access to affordable
health care and insurance," before they reach the age, he said.
Echoing the stance of Obama and other Democrats, Durbin said
changes to Social Security are needed but since the retirement
benefits program did not contribute to the deficit problem, it
should be tackled separately.
He proposed a new bipartisan commission to recommend a plan
to keep Social Security solvent for the next 75 years. Congress
should be required to vote on the changes, he said. Such a panel
shored up the pension program in the mid-1980s.