House Democrats Ask White House Officials About Role in Withholding Medicare Estimates
House Democrats on Friday sent two separate letters to Andrew Card, President Bush's chief of staff, and Joshua Bolten, the administration's budget director, asking them to explain whether they were aware of "predictions last year that the new Medicare prescription drug law would cost more than President Bush publicly said," the Washington Post reports (Goldstein, Washington Post, 3/20). 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. CMS chief actuary Richard Foster has said that the higher cost projection was known before the final House and Senate votes on the legislation in November but that former CMS Administrator Tom Scully told him, "We can't let that get out." In an e-mail to colleagues at CMS, Foster indicated he believed he might lose his job if he revealed his cost estimates for the Medicare legislation. Foster confirmed the allegations in interviews published in several newspapers last week. 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, "[Democrats] 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." Last week, HHS Secretary Tommy Thompson requested that the department's Office of Inspector General look into the issue, and on Thursday, 18 Senate Democrats asked the General Accounting Office to look into Foster's allegations (California Healthline, 3/19).
The letters, which are "virtually identical," ask Card and Bolten to describe all of the interactions that they had with Foster concerning the cost estimates, the Post reports. The letters state that HHS "rarely acts on its own on issues of this magnitude, especially when they have major ramifications for the federal budget. Rather, HHS coordinates its budget strategies and legislative estimates closely with the White House." According to the Post, the letters "reflect another method to try and tar the White House for its role in passing legislation that Republicans had expected to be an important political victory in an election year." The letters also attempt to "clarify a fuzzy picture painted by different administration officials in recent days over who was responsible" for telling Foster to withhold the estimates, according to the Post (Washington Post, 3/20).
In an interview with the Post late last week, Foster said that he believes the White House "participated in the decision to withhold analyses" of the Medicare legislation, adding that he thought Scully was "acting at times on White House instructions, probably coming from" Doug Badger, Bush's health policy adviser. According to Foster, Badger was the White House official most steeped in the administration's negotiations with Congress over Medicare legislation and was familiar with the analyses Foster's office produced (California Healthline, 3/19). Badger said in an interview Friday that during negotiations over the legislation, he had been aware "of some requests from Congress for the actuary's data" but "was also aware there were discussions between (legislative) staff and the actuary that [he] wasn't aware of or apprised of," the Post reports. Badger said that "to the best of [his] knowledge and recollection," he had not been part of a discussion of whether cost estimates should be shared with Congress. He also said that he did not know until last week that Scully's top aide had written Foster an e-mail, saying that if Foster shared information with Congress, "the consequences of insubordination are extremely severe." Badger said that "[t]o the extent [he] was aware" of Scully and Foster's disagreement about how much data should be shared, it "was appropriately handled" at CMS. Badger added, "That was my view then and is my view now."
On Friday, the White House "sought to insulate itself from the controversy," the Post reports. White House Press Secretary Scott McClellan said, "I'm not aware of anyone at the White House being involved in what has been alleged." However, McClellan would not directly respond to questions about whether any White House staff had checked to see if any Bush aides were involved or if administration officials believe they are obligated to share such cost estimates with Congress (Washington Post, 3/20). According to a federal law, officials cannot prevent a federal employee from having "oral or written communication or contact" with a member of Congress on issues related to the employee's duties (Pear, New York Times, 3/20). The GAO investigation requested by Senate Democrats would examine that issue (California Healthline, 3/19).
Foster on Friday provided Congress with documents revealing that federal payments to private health insurance plans under the Medicare legislation "could far exceed what Congress assumed when it passed the measure," the New York Times reports. The data estimates that the law will increase payments to HMOs by a total of $46 billion over the next 10 years, rather than the $14 billion assumed by lawmakers when they approved the law. The documents "show that the Bush administration was aware of the gap well before Congress approved the law," the Times reports. The documents also show that the administration anticipates that the number of Medicare beneficiaries enrolled in HMOs will increase from about 12% of the program's 41 million current beneficiaries to 32% of all beneficiaries by 2009. Foster estimates that enrollment in traditional fee-for-service Medicare and payments to Medicare providers both will decrease from 2006 to 2009 (New York Times, 3/20).
On March 24, CBO Director Douglas Holtz-Eakin and Foster will appear before the House Ways and Means Committee for the stated purpose of discussing the annual Social Security and Medicare Trustees reports. However, Democrats "likely will steer the conversation toward the administration's cost estimates before the [Medicare] law was passed -- and why Congress was not privy to them," CQ Today reports. According to CQ Today, legislators from both parties will also probably "grill the witnesses," who are "at the center of the raging dispute," over why CBO and OMB estimated such different numbers. On March 25, Thompson will meet with the Senate Labor-HHS Appropriations Subcommittee to discuss his agency's fiscal year 2005 budget. However, Thompson "could face more questions" about cost estimates for the Medicare legislation because Democrats on the Government Reform Committee set March 26 as the deadline for Thompson to turn over all documents pertaining to Foster's estimates (Schuler, CQ Today, 3/19).
The following newspapers also examined the Medicare law:
- "Medicare Overhaul Under Scrutiny: Probes, Confusion Taint Drug Plans" (Herrndobler, Chicago Tribune, 3/20).
- "Estimates, Ethics and Ads Tarnish Medicare Overhaul" (Schuler/Carey, CQ Weekly, 3/20).
- "Medicare Cards Promise Savings, But Expect Chaos: New Drug Benefit Is Criticized as Confusing, Costly to Some" (Cohen, Newark Star-Ledger, 3/22).
Medicare Law Has Become Stumbling Block for Bush" (Douglas, Philadelphia Inquirer, 3/21).
Several broadcast programs reported on the Medicare estimates:
- CBS' "Evening News": The segment includes comments from House Minority Leader Nancy Pelosi (D-Calif.) and Cybele Bjorklund, Democratic staff director for the House Ways and Means Subcommittee on Health (Andrews, "Evening News," CBS, 3/19). A video excerpt of the segment is available online in RealPlayer.
- CNN's "Capital Gang": The segment includes comments from Rep. Barney Frank (D-Mass.) (Novak/Shields, "Capital Gang," CNN, 3/20). The complete transcript is available online.
- MPR's "Marketplace": The segment includes comments from Rep. Sherrod Brown (D-Ohio) (Dimsdale, "Marketplace," MPR, 3/19). The complete segment is available online in RealPlayer.
- NPR's "All Things Considered": NPR's Julie Rovner discusses the investigations (Rovner, "All Things Considered," NPR, 3/21). The complete segment is available online in RealPlayer.
- PBS' "NewsHour with Jim Lehrer": The segment includes comments from Kevin Keane, HHS assistant secretary of public affairs; Rep. Jack Kingston (R-Ga.); Sen. Edward Kennedy (D-Mass.); and Urban Institute President Robert Reischauer (Dentzer, "NewsHour with Jim Lehrer," PBS, 3/19). The complete segment is available online in RealPlayer.
- WNYC's "On the Media": The segment discusses the video news releases (Garfield/Gladstone, "On the Media," WNYC, 3/19). The complete transcript and audio of the segment in RealPlayer are available online.