Democrats Seek Investigations Into Actuary’s Medicare Cost Estimates

Democratic lawmakers sent a letter to the White House Monday, asking the Bush administration not to retaliate against Richard Foster, CMS' chief actuary, who recently said he was told by former CMS Administrator Tom Scully not to reveal to lawmakers his estimates for the Medicare legislation, the Washington Post reports (Babington, Washington Post, 3/16). The Philadelphia Inquirer last week reported that an e-mail from Foster to colleagues at CMS indicated he believed he might lose his job if he revealed his cost estimates of the Medicare legislation. Foster confirmed the allegations in interviews published in several newspapers Monday. 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. Foster has said that the higher cost projection was known before the final House and Senate votes on the legislation in November but that Scully told him, "We can't let that get out." Foster said that he received a written note from Scully ordering him not to respond to certain requests from lawmakers and instead to provide the responses to Scully. The message allegedly warned about the consequences of insubordination. Scully has said that he did not threaten to fire Foster if the higher estimates were released. Scully also said that he "curbed Foster on only one specific request" made by Democrats at the time of the first House vote on the Medicare bill. Scully 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" (California Healthline, 3/15).

Sens. Edward Kennedy (D-Mass.) and Charles Schumer (D-N.Y.) on Monday wrote to Bush "to respectfully request that you make it clear to the White House staff that they are not to engage in any kind of retaliation" against Foster (Washington Post, 3/16). Sens. Frank Lautenberg (D-N.J.) and Jon Corzine (D-N.J.) also signed the letter, according to Dow Jones. The letter states, "It is vital that politics not influence the administration's investigation into Mr. Foster's allegations, which, if substantiated, could constitute significant wrongdoing on the part of some" (Middleton [1], Dow Jones, 3/15). On Friday, Senate Minority Leader Tom Daschle (D-S.D.) and House Minority Leader Nancy Pelosi (D-Calif.) demanded a new vote on the Medicare legislation, saying that "members of Congress were called to vote under false pretenses." Also Friday, five congressional Democrats asked the HHS inspector general to launch an ethics investigation into the matter (California Healthline, 3/15). Foster and CBO Director Douglas Holtz-Eakin next week will testify about cost estimates for the legislation before the House Ways and Means Committee (Schuler/Carey, CQ Today, 3/15).

Bush administration officials have "tried to downplay the controversy," the Arkansas Democrat-Gazette reports (Barton, Arkansas Democrat-Gazette, 3/16). White House spokesperson Trent Duffy said that lawmakers' concern about the withheld estimates amounts to "a desire ... to divert attention from the fact that the administration delivered [a Medicare bill] where others have failed" (CQ Today, 3/15). Mark McClellan, whom the Senate last week confirmed as the new CMS administrator, said in written comments to senators published on Monday that estimates from CBO and OMB for the new Medicare legislation are "both likely wrong." He said, "I believe that the future will likely prove both sources wrong, given all the uncertainties that face the program" (Middleton [2], Dow Jones, 3/15).

John Feehery, spokesperson for House Speaker Dennis Hastert (R-Ill.), said that some lawmakers' "concerns of malfeasance were unjustified," the Democrat-Gazette reports. Feehery added, "The crystal ball on budgeting is usually pretty murky." He said that GOP leaders relied on the $400 billion over 10 years estimate because it came from CBO (Arkansas Democrat-Gazette, 3/16). However, "at least one member of the House GOP leadership" has joined Democrats in saying that "Foster's claims are troubling," the Post reports. Rep. Jack Kingston (R-Ga.), vice chair of the House Republican Conference, on Monday said that he used CBO's estimate to gain support from "reluctant colleagues," the Post reports. He added that Foster's claim "not only hurts the credibility of everybody in the process" of enacting the legislation but also particularly affects "those of us on the whip's team" (Washington Post, 3/16).