CMS Actuary Told To Withhold From Lawmakers Cost Estimates for New Medicare Law, E-Mail Says

Before Congress approved the Medicare legislation last fall, Richard Foster, the chief actuary for CMS, informed colleagues in an e-mail that he was told to withhold a series of Bush administration cost estimates for the legislation that could have "torpedoed" its passage, the Philadelphia Inquirer reports. According to the Inquirer, 13 conservative House Republicans had said that they would vote against the bill if its estimated cost was more than $400 billion (Pugh, Philadelphia Inquirer, 3/12). According to Office of Management and Budget estimates released after Congress passed the legislation, the Medicare law will cost $534 billion over the next 10 years, $134 billion more than estimated by the Congressional Budget Office. The fiscal year 2005 budget proposal President Bush released last month acknowledges the higher estimate (California Healthline, 2/11). Analysts in CMS had "concluded repeatedly" that the Medicare legislation would cost "upwards of $100 billion" more than estimated by CBO, according to the Inquirer. Five months before the House voted on the reconciled Medicare legislation in November, Foster had estimated that the Senate's Medicare bill would cost $551 billion over 10 years, the Inquirer reports. Foster was concerned that he might lose his job if he revealed the higher figures. In June, before the first congressional vote on the legislation, he wrote in an e-mail to colleagues, "I'm perhaps no longer in grave danger of being fired, but there remains a strong likelihood that I will have to resign in protest of the withholding of important technical information for key policy makers for political reasons." HHS officials turned down requests by the Inquirer to interview Foster (Philadelphia Inquirer, 3/12).

Democrats in June protested a decision by the Bush administration to withhold an analysis by Foster about the House Medicare legislation. At the time, an aide to Rep. Pete Stark (D-Calif.) said Foster maintained that the analysis was completed, but that he was forbidden to release it by then-CMS Administrator Tom Scully. "Tom Scully told my staff that [Foster] would be fired so fast his head would spin if he released this information to us," Stark had said in a release (California Healthline, 6/26/03). Cybele Bjorklund, Democratic staff director for the House Ways and Means Subcommittee on Health, said that Scully informed her that he had "ordered Foster to withhold information and that Foster would be fired for insubordination if he disobeyed," the Inquirer reports. Lawmakers and congressional staff who worked on the legislation said that Foster was not allowed to answer inquiries about the bill's cost, the Inquirer reports. In an interview with the Inquirer, Scully denied Bjorklund's allegations, adding that he had "curbed Foster on only one specific request" made by Democrats at the time of the first House vote. He said, "They were trying to be politically cute" and get Foster to give an estimate on the bill "and put something out publicly so they [could] walk out on the House floor and cause a political crisis, which is bogus." Scully added, "I just said, 'Look, [Foster] works for the executive branch; he's not going to do it. Period." Scully said that Liz Fowler, chief health lawyer for Democrats on the Senate Finance Committee, would confirm that Foster was otherwise available to talk to lawmakers. But Fowler called Scully "a liar," the Inquirer reports. Last month, HHS Secretary Tommy Thompson said, "I may have been derelict in allowing my administrator, Tom Scully, to have more control over [the estimates] than I should have," adding, "And maybe he micromanaged the actuary and the actuary services too much." Thompson said, "I can assure you that from now (on) ... you will have as much access as you want to anybody or anything in this office." Democrats on Feb. 3 and March 3 asked for a record of Foster's estimates but have not yet received them. HHS spokesperson Bill Pierce said, "We respond to all inquiries in time, and we will do the same" with these.

Rep. Sue Myrick (R-N.C.), one of the 13 conservative lawmakers who said they would vote against the Medicare legislation if it was estimated to cost more than $400 billion over 10 years, said that she was "very upset" when she learned of OMB's higher estimate. She added, "I think a lot of people probably would have reconsidered (voting for the bill) because we said that $400 billion was our top line." However, Myrick said that she did not think the action was an effort "to pull the wool over our eyes." Stark said, "This 'need to know, our eyes only' stuff is getting too restrictive for us to do a decent job" (Philadelphia Inquirer, 3/12).