On the first real day of work following the July Fourth recess, Senate Democrats delineated their position on the upcoming, high-stakes Medicare prescription drug bill conference.

Twenty-nine Democrats, including Minority Leader Tom Daschle (S.D.), signed off on a letter to President Bush, penned by Sen. Edward Kennedy (Mass.), outlining their demands.

“We will strongly oppose a final bill that would do more harm than good to seniors, beneficiaries with disabilities, and to Medicare itself,” Kennedy wrote Tuesday.

Mainly, they want a Medicare fallback option for all key proposals.

“We will oppose a conference report that forces seniors to choose between giving up their doctor or facing higher premiums to stay in the current Medicare program,” the letter states.

The Senate appointed conferees Monday, but the House has yet to name its team to the committee, which will hash out the differences between the competing bills passed just before Congress broke.

While the Senate-passed version would allow private companies to administer the drug benefit program, the Senators want a back-up Medicare plan too.

Finally, they warned against including controversial provisions contained in the House bill.

“In particular, we oppose as unwise policy the addition of health savings accounts to the bill,” Kennedy wrote. “If $174 billion in additional resources are available, those funds should be used to close the gaps in the Medicare prescription drug benefit.”

While the House vote was a squeaker, the Senate’s version passed with a comfortable 76-21 margin. Nonetheless, Daschle warned Republicans not to be fooled by that spread.

“Don’t be deceived by the overwhelming margin here,” he told reporters. “We have some very significant concerns about the prospects of reducing the commitment to seniors and providing the kind of meaningful benefits that we all have proposed in this legislation.”

“It’s critical that that commitment be maintained,” he added.

In response to the letter, Nick Smith, a spokesman for Senate Majority Leader Bill Frist (R-Tenn.) would only say: “Going into conference, Senator Frist indicated there will be a number of issues that we’ll be discussing.”

As for how quickly a bill may be ready for the president’s signature, Smith said Frist hopes the conference committee will wrap up its work in a “reasonable amount of time.”

The Kennedy letter sets Senate Democrats up for a face-off with some of the most conservative Republican Members of the House, who wrote Speaker Dennis Hastert (R-Ill.) a letter June 24 saying theywill not back a bill that doesn’t overhaul the basic Medicare program.

The final product “must include comprehensive structural reforms that prepare Medicare for the next generation of beneficiaries,” 44 GOP House Members wrote.

If no such provision is included, “we cannot — as a matter of public policy — support a bill to add a prescription drug benefit to Medicare,” stated the group, which included Reps. Sam Johnson (Texas), Pat Toomey (Pa.) and Jennifer Dunn (Wash.).

Senate Finance Chairman Chuck Grassley (R-Iowa) implored conferees to work together.

“I hope the conference can produce a bipartisan product,” he said Tuesday. “Drawing lines in the sand doesn’t foster cooperation and bipartisanship.

“Success will be measured not by what lines do and don’t get crossed, but by the bill’s ability to deliver a comprehensive, affordable drug benefit that’s long overdue,” he concluded.