GAO calls Medicare videos an illegal use of funds

Sunday, May 23, 2004

May 24, 2004

WASHINGTON - The General Accounting Office slammed the Medicare Modernization Act last week when it ruled CMS illegally used taxpayers money to make videos promoting the new law. The GAO called the advertisements  "covert propaganda."
The videos, which were aired on at least 40 stations in 33 markets, were "not strictly factual news stories" and were flawed by "notable omissions and weaknesses" in their explanation of the law,'" stated the GAO. A further concern was that the government was never identified as the source of the information.
The GAO decision has further fueled political debate over the already divisive Medicare law. But, Seth Johnson, director of public policy for AAHomecare, said the controversy is not likely to lead to any changes in the law.
"It's something democrats will hold a press conference on, but in the end I don't think it is going to have any impact as far as forcing changes to the Medicare bill," he said. "[AAHomecare is] really looking for something that we can put legislative language on that we know is going to move [in Congress]."
This is the second decision placing blame on CMS for how the Medicare Modernization Act has been handled. Earlier this month, the Congressional Research Service said the Bush administration broke the law by not disclosing information on the cost analysis of the bill prior to its passing.
Medicare's chief actuary, Richard Foster, said then CMS Administrator Tom Scully threatened to fire him if he released his analysis that the bill would cost $100 million more than the estimated $400 million price tag.