OIG: Scully scuttled Medicare cost data

Saturday, July 31, 2004

WASHINGTON - The OIG cited CMS for failing to provide “premium estimates” of the cost of the Medicare Prescription Drug Act in its investigation of the issue released in July.

The GAO will now use the investigation’s findings to determine whether the DHHS violated federal appropriations law.

The OIG’s investigation concluded that CMS did not provide the estimates requested by members of Congress and did not give overall estimates on the cost of the bill to congressional staff, according to a statement from Acting Principal Deputy Inspector Dara Corrigan.

The investigation also confirmed that former CMS Administrator Tom Scully warned CMS’s chief actuary, Richard Foster, that he would be disciplined if Foster submitted certain cost estimates to congressional requests. One of Scully’s staff assistants issued Foster a similar warning, saying he would be fired if the information were released.

The investigation, however, turned up no evidence that withholding the information broke criminal laws. The OIG further said that Foster had no legal authority to disclose information independently to Congress, and that Scully had the final authority to determine the flow of the information.

The Congressional Research Service in May reported to Congress that the Bush administration broke the law by not disclosing information regarding the true cost of the bill.