Bush Administration Campaign for New Medicare Law Legal, Has ‘Weaknesses,’ GAO Says
The Bush administration's campaign to promote the new Medicare law, which includes television ads, does not violate restrictions on use of federal money for "publicity or propaganda purposes," but it does misrepresent the legislation through "omissions and other weaknesses," according to a General Accounting Office assessment released Wednesday, the New York Times reports (Pear, New York Times, 3/11). The administration's campaign includes a 30-second television ad titled, "Same Medicare. More Benefits," that will air through March; print and radio ads; and mailed fliers to inform beneficiaries about reforms to Medicare and to address some criticisms of the law. HHS is paying for the campaign with part of the $1 billion in federal funds allocated to implement reforms to Medicare. GAO launched its investigation at the request of some Democrats to determine whether the Bush administration developed the ad for "political purposes." Democrats called on ABC, CBS, CNN and NBC to pull the ads until GAO completed its investigation (California Healthline, 2/19). In a legal opinion, GAO said the campaign does "not violate the prohibition on the use of appropriated funds for publicity or propaganda," because HHS has "explicit authority to inform Medicare beneficiaries" about the new law (New York Times, 3/11). HHS recently began mailing the fliers to all Medicare beneficiaries (Kemper, Los Angeles Times, 3/11). Although the fliers credit President Bush and Congress for the legislation, the GAO opinion says it is describing "the constitutional process for enacting legislation" and, as a result, is acceptable, the New York Times reports (New York Times, 3/11).
While it determined that the campaign is "not so partisan as to be unlawful," GAO stated, "This is not to say that the content (of the ads and fliers) is totally free of political content" (Los Angeles Times, 3/11). For instance, the opinion identifies problems in the campaign, including that it fails to point out that beneficiaries could be required to pay a $30 annual fee for Medicare drug discount cards, which will be available this summer (Sherman, AP/Las Vegas Sun, 3/10). Further, the television ad "incorrectly suggest[s]" that the new law set a $35 monthly premium for prescription drug coverage, scheduled to begin in 2006, Anthony Gamboa, general counsel for GAO and author of the legal opinion, said, according to the New York Times. Gamboa added that the $35 figure is only an "estimate," the New York Times reports (New York Times, 3/11). The legal opinion says that the theme of the campaign "may appear as an attempt to persuade the public to the administration's point of view regarding the newly enacted benefit" (Rovner, CongressDaily, 3/11). GAO also questioned the administration's assertion that it placed ads in certain newspapers "to provide helpful information to Congress," the Washington Post reports (Connolly, Washington Post, 3/11). CongressDaily reports that the opinion "pointedly criticized running one of the ads in the newspaper Roll Call," stating, "There are any number of more effective vehicles to communicate with members of Congress, and at less cost, than advertising in a newspaper" (CongressDaily, 3/11).
Democratic lawmakers who requested the investigation said GAO's opinion is based on an "extremely narrow reading" of the laws and called on HHS to pull the campaign, the Los Angeles Times reports. "The GAO agreed with us that the administration sugar-coats the drug discount cards that will soon be offered, and that they overstate the benefits of the Medicare prescription drug plan," Sen. Frank Lautenberg (D-N.J.) said (Los Angeles Times, 3/11). Sen. Edward Kennedy (D-Mass.) said, "The more senior citizens learn about the bill, the less they like it" (Washington Post, 3/11). However, HHS spokesperson Kevin Keane called the opinion "a complete victory for our effort to educate seniors," adding that the department's promotion of the legislation would "remain aggressive" (Los Angeles Times, 3/11). Senate Majority Leader Bill Frist (R-Tenn.) said, "This opinion clearly shows that HHS is following the spirit and letter of the law by providing seniors critical information" (CongressDaily, 3/10). HHS Secretary Tommy Thompson said that the ads have been successful in directing seniors to call Medicare information lines, citing a 70% increase in calls (Los Angeles Times, 3/11). The GAO legal opinion is available online.
In related news, HHS will award $21.1 million this year and $31.7 million next year to state and local programs that work to educate Medicare beneficiaries about the new law, Secretary Tommy Thompson announced Wednesday in testimony before the House Energy and Commerce Committee. The funding, a 69% increase over the fiscal year 2003 total, will fund one-on-one advice efforts provided at State Health Insurance Assistance Programs. Thompson said, "These counselors are among the most effective resources we have in helping Medicare beneficiaries learn about the changes to Medicare. They will be able to use these new funds to equip each local organization with the tools it will need to answer beneficiaries' questions" (HHS release, 3/10).
During a session Wednesday at the annual meeting of America's Health Insurance Plans, House Ways and Means Committee Chair Bill Thomas (R-Calif.) "chided" private health plans' use of additional money granted to them under the new Medicare law, CongressDaily reports. AHIP is the new name of the merged American Association of Health Plans-Health Insurance Association of America. Thomas criticized private plans for trying to gain new members by lowering premiums and re-entering markets they had left instead of using the funds to "prove their products are superior" to traditional, fee-for-service Medicare, according to CongressDaily. He added that private plans should be using the additional money "to figure out what works, what doesn't work -- and to get people to do that." AHIP President Karen Ignagni said that Medicare private plans "are ready to demonstrate that we have a better way to deliver health care" (Rovner, CongressDaily, 3/10).
Some oncologists are "so angry" about changes in the way they are paid for administering cancer medications to Medicare beneficiaries that they "are warning patients" that they might have to receive treatment in hospitals rather than physician offices, the New York Times reports (Harris, New York Times, 3/11). Under the Medicare law, payments will be reduced from 95% to 85% of an oncology medication's average wholesale price. The payment rate will change again next year and will be more closely tied to the actual price that doctors pay rather than the listed AWP. According to the federal government, the Medicare law also increases payments to providers for practice expenses, which will result in "no change in the overall payments to cancer doctors this year" (Sherman,
AP/Las Vegas Sun, 3/4). A letter sent to patients by doctors at the Hartford, Conn.-based practice Oncology Associates says that as a result of payment changes, patients might have to "switch to older medications," which "may be more toxic or less convenient." The letter adds, "[W]e will be financially unable to give chemotherapy medications which cost us more than the reimbursement." Although doctors in the practice acknowledge that switching patients to a more toxic treatment because of changes to reimbursement might be unethical, Dr. Robert Siegel, a member of the practice, said, "But if Medicare makes it impossible to do what we've been doing, then I don't know what to do." Other practices nationwide have sent similar letters to patients. Leslie Norwalk, acting deputy administrator at CMS, said, "These letters seem to be scare tactics" (New York Times, 3/11).