CBS Pulls Bush Administration’s Medicare Advertisement Pending Outcomes of GAO Investigation
CBS on Friday said that it has stopped running a television advertisement for the new Medicare law (HR 1), pending the outcome of an investigation into the ad by the General Accounting Office, the New York Times reports (Pear, New York Times, 2/14). The 30-second TV ad, titled "Same Medicare. More Benefits," will cost about $9.5 million and will air through March on network and cable television. The ad is part of a larger $22 million promotional campaign, which also includes print and radio ads, to inform beneficiaries about reforms to Medicare and address some criticisms about the law. HHS will pay for the campaign with part of the $1 billion in federal funds allocated to implement reforms to Medicare. At the request of some Democrats, who say that the ad "misrepresents what the law does" to help President Bush in his re-election campaign, GAO has launched an investigation to determine whether the Bush administration developed the ad for "political purposes" (California Healthline, 2/13). Democrats have called on CBS, NBC, ABC and CNN to pull the ads until GAO completes its investigation (California Healthline, 2/12). A CBS policy states that the network "does not sell time for the advocacy of viewpoints on controversial issues of public importance." An unacceptable commercial is one that "takes a position on such an issue" or that "presents arguments parallel to those made by one side 'so as to constitute implicit advocacy,'" the policy says, the New York Times reports. Dana McClintock, a spokesperson for CBS, said the ad was pulled because it "violated our longstanding policy on advocacy advertising," adding, "We pulled it as soon as we became aware of the investigation" (New York Times, 2/14). CBS Executive Vice President Martin Franks said that the network had asked for more information on the ad from the agency handling the campaign for HHS and then decided to suspend the advertisements pending a decision from GAO. He added, "Perhaps [HHS] went beyond educating people about the changes in Medicare."
Reps. Rosa DeLauro (D-Conn.) and Rahm Emanuel (D-Ill.) said in a statement, "We urge the other networks currently running the ads to follow" CBS's lead (Goldstein, Washington Post, 2/14). Sen. Frank Lautenberg (D-N.J.), who requested the GAO investigation, said, "The bottom line is that this ad is an illegal use of taxpayer dollars and is under active investigation. My hope is now other networks will follow suit." CNN will continue to run the ad because it does not violate the company's policies, a spokesperson said. Further, NBC will continue to run the ad but is considering Democrats' request to pull it; ABC and Fox did not comment, according to the AP/Arizona Republic (Sherman, AP/Arizona Republic, 2/14). According to Kevin Keane, HHS assistant secretary of public affairs, ABC had required the ad to include an asterisk and the words "savings vary" in the part of the ad asserting that beneficiaries will save money from the changes (Goldstein, Washington Post, 2/14). Keane said that CBS is "bowing to political pressure," (Kemper, Los Angeles Times, 2/14). He added, "It's unfortunate that CBS has chosen to undermine our efforts to educate seniors about the law." Senate Majority Leader Bill Frist (R-Tenn.) said the ad is "clearly nonpartisan," and he called on CBS to reconsider its decision. John Feehery, a spokesperson for House Speaker Dennis Hastert (R-Ill.), called CBS' decision "political," adding that Franks is "a partisan Democrat" who has given financial contributions to Democrats (New York Times, 2/14). But Franks said, "We just thought that since there was a (GAO) investigation going on, it was prudent to wait" (Los Angeles Times, 2/14). NPR's "Morning Edition" Monday reported on the ads. The segment includes comments from Robert Hayes, president of the Medicare Rights Center; Pete Jeffries, spokesperson for Hastert; Keane; and Rep. Nancy Pelosi (D-Calif.) (Overby, "Morning Edition," NPR, 2/16). The complete segment is available online in RealPlayer.
Federal officials on Monday warned that the Atlanta-based regional office of CMS, which covers eight states, has discovered evidence of fraud in the marketing of the new Medicare prescription drug discount cards, the New York Times reports. In some parts of the country, people "fraudulently impersonating or misrepresenting" Medicare have telephoned or made door-to-door visits to beneficiaries, offering "Medicare-approved" cards, according to the Times. Valeria Allen, an insurance specialist at CMS, said the people committing the fraud offer to discuss the drug discount card program with beneficiaries and then try to obtain personal identifying information from them. In some cases, the caller has obtained personal information before visiting beneficiaries' homes. Allen said, "Beneficiaries should not be giving anyone their personal identifying information. Medicare has not begun its enrollment, marketing or outreach process for our beneficiaries regarding the prescription discount drug program." The Times reports that Medicare contractors in the West and the Midwest are looking into reports of similar fraudulent activity. The deadline for companies to seek federal approval for their discount cards was Jan. 30, and the government has not yet approved any of the applications. Beneficiaries can sign up for the cards in May and begin using them in June (Pear, New York Times, 2/17).
Many oncologists say that payment cuts called for under the Medicare legislation for cancer drugs administered in doctors offices are "having a devastating impact on their practices," the Washington Post reports. The provision in the Medicare law -- designed as a "long-overdue overhaul of an irrational fee structure that gave oncologists huge profits on chemotherapy" -- reduced the reimbursements for office-administered chemotherapy drugs from 95% to 85% in the first year, with further cuts to follow in each of the next two years, the Post reports. The law also calls for payments to doctors for administrative costs to be raised 32%. According to Daniel Mendelson, president of the Health Strategies Consultancy, the changes could mean that some doctors' practices experience 20% to 30% reductions in revenue. He added that some oncology practices have eliminated staff and services or closed satellite offices. The American Society of Clinical Oncologists has asked the federal government to reverse the cuts for some of the medications. The Medicare Payment Advisory Commission will monitor the effects of the changes and make recommendations if it finds problems, according to officials (Stein, Washington Post, 2/14).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.