Dems: Medicare Costs Kept Secret

WASHINGTON – Democrats say an internal Bush administration investigation into the new Medicare (search) law confirms there was a coordinated effort to keep its true costs from Congress and the public.

The Health and Human Services Department inspector general said in a report released Tuesday that administration officials broke no laws in withholding the cost estimates from Congress. But the report described the aggressive tactics that were used to keep lawmakers from learning that the administration had estimates of the legislation's cost that were $100 billion more than the president and other officials were acknowledging.

Thomas Scully (search), the administration's Medicare chief until December, threatened to fire chief Medicare actuary Richard Foster to prevent him from giving information to lawmakers. Scully, then the administrator of the federal Centers for Medicare and Medicaid Services (search), "has the final authority to determine the flow of information to Congress," the unsigned report said.

Sen. Edward Kennedy, D-Mass., said Tuesday: "The IG's report describes the extraordinary deception of Bush administration officials to cover up the true costs of the Medicare bill. What they did was clearly wrong by any definition."

Other Democrats said the inspector general's inquiry was narrowly tailored, underscoring the need for an independent investigation that also looks at what role the White House may have played in the suppression of information.

"It sounds as though the Bush administration examined itself and found it did nothing wrong," said Rep. Pete Stark, D-Calif., senior Democrat on the House Ways and Means health subcommittee.

That inspector general's conclusion contradicted the findings of the nonpartisan Congressional Research Service, which said in May that threats against Foster designed to keep him from giving Democratic lawmakers his projections of the bill's cost probably broke the law. The Justice Department in an opinion attached to Tuesday's report, said CRS was wrong.

Despite the reaction from Democrats, the administration said the report should be the end of the matter. "We hope that with the release of this report we can put behind us the political squabbling and move on to the important work of implementing the new law," HHS spokesman Bill Pierce said.

That seemed unlikely since the General Accounting Office, Congress' investigative arm, is also looking into whether the gag order on Foster violated federal law.

Dara Corrigan, the acting HHS inspector general, said her office is also continuing to investigate the ethics waiver that HHS Secretary Tommy Thompson granted Scully, allowing him to continue work on Medicare legislation while he was looking for work with law and investment firms that have clients affected by the legislation.

The various investigations highlight the trouble the Bush administration has had in promoting the new Medicare prescription drug law, thought to be an election-year boon for the GOP. The law's first widely available tangible benefit, the Medicare-approved discount drug card program, has gotten off to a slow, confusing start.

The Associated Press reported a year ago that Scully threatened to fire Foster if Foster released his calculations to Democrats. Scully said his comments were "heated rhetoric in middle of the night."

But the matter took on a new life when the administration projected in the budget it submitted to Congress in January that the 10-year cost of the bill would be $534 billion, instead of $395 billion estimate used in writing the legislation.

Foster's estimates, written during consideration of the bill, still have yet to be made public or turned over to congressional Democrats who have requested them.

In March, Thompson promised to release them and said the inspector general's investigation would clear the air.

"There seems to be a cloud over this department because of this. We have nothing to hide, so I want to make darn sure everything comes out," Thompson said then.

But since then, he has refused to release the documents in question. House Democrats have sued for the documents in federal court and The Associated Press, which sought the same materials under the Freedom of Information Act, has appealed the withholding of 149 pages out of 162 pages that the agency acknowledges are responsive to its request.