Second Ways and Means Hearing on Medicare Cost Estimates Scheduled

Some Democratic members of the House Ways and Means Committee have "persuaded" committee Chair Bill Thomas (R-Calif.) to hold another hearing -- scheduled for Thursday -- regarding CMS chief actuary Richard Foster's allegations that the Bush administration was aware of his analysis that the Medicare legislation would exceed its target spending goal and sought to withhold the estimates, the Washington Post reports (Washington Post, 3/31). Sen. Charles Rangel (D-N.Y.) used "a little-known rule that allows the minority party to request more witnesses to be called" to "force Thomas to schedule a follow-up to last week's hearing in which Foster testified," Roll Call reports (Pierce, Roll Call, 3/31). Foster said during last week's committee hearing that as early as June, he shared with Doug Badger, President Bush's health policy adviser, and James Capretta, associate director of the Office of Management and Budget, his higher cost estimates for the Medicare legislation (California Healthline, 3/25). According to OMB 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 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. 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. 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. Further, Democrats on the Senate Finance Committee have sent committee Chair Chuck Grassley (R-Iowa) a letter requesting that the committee hold a hearing on the reasons that Congress did not receive OMB's estimates (California Healthline, 3/29).

According to Roll Call, Rangel invited witnesses whom he believes "may have had a direct hand in keeping the higher Medicare cost estimate from Congress," including Badger, Scully and Jeff Flick, Scully's former deputy (Roll Call, 3/31). White House spokesperson Trent Duffy said that Badger "will not be testifying." Duffy called the request a violation of "separation of powers." Scully on Tuesday said he was not sure if he would be able to appear at the hearing, according to the Washington Post (Washington Post, 3/31). A Rangel spokesperson said that it is "unclear whether any of the invited witnesses would show up," Roll Call reports.

House and Senate Democrats as early as April are likely to ask Attorney General John Ashcroft to appoint a special Department of Justice counsel to investigate "any criminal behavior in the Bush administration's handling" of the Medicare legislation, Roll Call reports. Sen. Frank Lautenberg (D-N.J.) said Democrats want the special counsel to investigate whether criminal laws were broken in the alleged threat to fire Foster over the release of his cost analysis and the alleged attempt to bribe Rep. Nick Smith (R-Mich.) to change his vote on the Medicare law (Roll Call, 3/31). In December, Smith, who plans to retire this year, said that unnamed Republican lawmakers promised to donate $100,000 to his son's congressional campaign in exchange for his support on the Medicare bill. However, Smith later retracted the comment and said that allegations of bribery are "technically incorrect." According to Smith, some Republican lawmakers had said that they would oppose his son's campaign if he did not vote in favor of the Medicare legislation, but they did not offer to donate funds to the campaign, as previous reports had indicated. Smith voted against the Medicare legislation. The House Committee on Standards of Official Conduct last week appointed four members to a subcommittee to investigate whether Smith was offered a bribe last November in exchange for his vote in favor of the Medicare legislation. FBI and DOJ also have launched investigations into the case (California Healthline, 3/26). Last week, Sens. Hillary Rodham Clinton (D-N.Y.), Edward Kennedy (D-Mass.), Lautenberg and Debbie Stabenow (D-Mich.) sent Ashcroft a letter requesting a DOJ investigation into whether Bush administration officials violated two federal criminal laws prohibiting the withholding of certain information from Congress (California Healthline, 3/29). DOJ has not yet responded to senators' request for a criminal probe into Foster's allegations.

Senate Minority Leader Tom Daschle (D-S.D.) said, "I think a special counsel could help clarify what happened." However, Lautenberg said that Democrats have to make sure that "enough public momentum is behind them to force Ashcroft's hand" before asking for the "unusual step of appointing a special prosecutor," Roll Call reports. According to Roll Call, one House Democratic aide said that Democrats do not want to "move too quickly because they fear the call for a special counsel would be seen as only a political move." Republicans have "shrugged off suggestions that the controversy" requires "a special counsel to resolve it," Roll Call reports. Amy Call, a spokesperson for Senate Majority Leader Bill Frist (R-Tenn.), said, "I think [Frist] feels, at least for the CMS estimate, that's a matter for the administration to resolve," adding, "He does think its political" (Roll Call, 3/31).