The Clinton administration last week attacked a leading Medicare-reform proposal that calls for creation of an independent board to oversee HCFA.
The U.S. Justice Department and HCFA both said the proposal to create a Medicare Board under pending legislation sponsored by Sens. John Breaux (D-La.) and Bill Frist (R-Tenn.) would unconstitutionally insulate the program from public accountability and executive authority.
Clinton's reform plans include proposals to create a competitive bidding system for Medicare+Choice plans, as well as a modernization of fee-for-service payment policies. He doesn't, however, call for a board to oversee HCFA.
Responding to a request from Sen. Jay Rockefeller (D-W.Va.), Assistant Attorney General Robert Raben wrote that such a board would be unconstitutional because it would erode presidential power and congressional oversight over HCFA, an executive agency.
Rockefeller's office released Raben's five-page letter last week in Washington.
In testimony before the Senate Finance Committee, HCFA Administrator Nancy-Ann Min DeParle delivered a similar message and added that the board would create a redundant administrative structure.
Commenting on the Justice Department letter, Rockefeller said, "Removing Medicare from the accountability of Congress and the president amounts to an abdication of duty that would risk the healthcare of millions of America's seniors."
As a member of the National Bipartisan Commission on the Future of Medicare in 1998-1999, Rockefeller voted against an early version of the Breaux-Frist proposal.
Under the Breaux-Frist bill, introduced last November, the seven-member Medicare Board would oversee a system under which the government would pay most, but not all, of beneficiaries' premiums to join private-sector health plans.
It would sign and enforce contracts with the private plans that would cover Medicare beneficiaries. Its members would be appointed by the president and confirmed by the Senate.
But because the proposal limits the president's ability to remove members, the board would be insulated from executive control and might represent a violation of constitutional principles, the Justice Department said.
HCFA's role would be diminished under the proposal. HCFA would administer the remaining Medicare fee-for-service system, graduate medical education, Medicaid and state children's health insurance programs.
Breaux responded in a written statement by saying that the Medicare board would make the program more flexible and guarantee that private-sector plans offer at least the same benefits as Medicare does today.
Breaux's office released a congressional analysis rebutting the Justice Department's claims. It said creating the board, even if the president's ability to remove members is limited, falls within congressional authority to shape executive agencies.