President Bush signed a Medicare measure that provides the most sweeping changes to the federal entitlement program for seniors since its inception nearly 40 years ago.

“Our nation has made a promise, a solemn promise to America’s seniors. We have pledged to help our citizens find affordable medical care in the later years of life,” Bush told the crowd gathered for the bill-signing ceremony at Constitution Hall. “Lyndon Johnson established that commitment by signing the Medicare Act of 1965. And today, by reforming and modernizing this vital program, we are honoring the commitments of Medicare to all our seniors.”

Delivering on his campaign promise, the $395 billion overhaul offers prescription-drug coverage to all 40 million seniors and disabled Americans in the Medicare program. But this benefit doesn’t kick in until 2006.

In the meantime, seniors will be able to purchase a Medicare-backed discount drug card for about $30 a year that is estimated to reduce prices by 10-25 percent. Since the typical senior spends $1,285 annually on his or her medicines, the card is expected to save a senior who lacks drug coverage as much as $300 a year. Low-income seniors will receive a $600 credit on their cards to help them pay for needed medications.

Among examples of seniors who stand to benefit from the new program, Bush cited Mary Jane Jones from Midlothian, Va. Jones relies on a modest income to cover monthly medical bills of nearly $500. Bush described how things got so tight for her she was reduced to using needles twice or three times for her insulin shots. In exchange for a monthly premium of about $35, Jones is estimated to save nearly $2,700 in annual prescription drug spending under the new law, according to Bush.

The president touted the increased choices seniors will have under the modernized system, which will be opened to the private sector. Seniors can choose to either stay in traditional Medicare and get prescription drug coverage added, or they can choose a new Medicare-approved private plan. The law allows Medicare to contract with private firms and encourages insurance companies to offer private plans to the millions of seniors who now receive health benefits according to terms fixed by the government. Private employers will also receive incentives to continue to provide drug coverage to their retirees.

The revamped Medicare program expands preventive services. Beginning in 2005, all newly-enrolled Medicare beneficiaries will be covered for a complete physical. Everyone in the system will be covered for blood tests that can diagnose heart diseases. Those at high risk for diabetes will also be covered for blood-sugar screening tests.

The new law also creates Health Savings Accounts – which function like IRAs – to allow all Americans to tuck tax-free dollars away to pay future health-care expenses.

Democrats, including Sen. Hillary Clinton, D-N.Y., were quick to criticize the staggered start of the prescription-drug coverage, the cost and other aspects of the reform.

“One of the reasons why the president doesn’t want to implement it until after the ’04 election is because the administration doesn’t want the people to know too much until after the election when there’s little they can do about it,” she told reporters yesterday. “Many people will wake up and discover that the Medicare bill is a cruel hoax. It does not provide the kind of benefits that they had hoped for, and it will lead to the undermining of Medicare traditionally.”

House Democratic leader Nancy Pelosi of California and Sen. Edward Kennedy, D-Mass., scheduled a rally with seniors to highlight their concerns over the measure.

The legislation had the strong backing of the AARP.

“Some opponents of the legislation are charging that it will destroy Medicare. These scare tactics are designed to alarm seniors and create a furor against AARP,” said chief executive officer William Novelli on the organization’s website.

“AARP supported this legislation for one reason and one reason only – it will provide important prescription drug coverage and financial relief for millions of current and future Medicare beneficiaries,” Novelli continued. “Though certainly not perfect, the bill represents an historic breakthrough after years of partisan gridlock in Congress and an important milestone in the nation’s commitment to strengthen and expand health security for older Americans and their families.”

Taking a swipe at the Democrats, Bush similarly hailed the “historic law” as a victory over inaction.

“The challenges facing seniors on Medicare were apparent for many years. And those years passed with much debate and a lot of politics, and little reform to show for it. And that changed with the 108th Congress,” he said.

Note: Read our discussion guidelines before commenting.