Democrats continued to beat the Medicare cost drum last week, calling for subpoenas of former CMS Administrator Tom Scully and White House health policy adviser Doug Badger, who both declined to testify before the powerful House Ways and Means Committee.
Rep. Bill Thomas (R-Calif.), chairman of the committee, called a hearing last week to continue a discussion on the Medicare trustees' report, which said Medicare's hospital insurance trust fund will go broke seven years earlier than expected.
Both hearings focused almost entirely on whether members of the Bush administration, particularly Scully, ordered the agency's chief actuary to conceal from Congress a CMS estimate of how much it would cost to enact the Medicare reform law (March 29, p. 4).
In a letter to the committee last week, Scully said a busy travel schedule prevented him from testifying but that he had dealt fairly with CMS Chief Actuary Richard Foster and all other employees.
Democrats weren't satisfied. "Maybe we interfered with his nap time," Rep. Lloyd Doggett (D-Texas) said, arguing that travel is no reason to avoid the committee's questions. Badger, a top economic adviser to Bush who played an active role in Medicare reform negotiations, "is the Condoleezza Rice of health policy," Doggett said.
Alberto Gonzales, counsel to President Bush, told the Ways and Means Committee in a March 31 letter that Badger would not testify. A White House spokesman cited "separation of powers" as the reason.
In the charged partisan atmosphere that took over the Ways and Means hearing room last week, Thomas said Scully and Badger should only be compelled to testify if there is a valid legal reason and not to satisfy some lawmakers' curiosity. By a party-line vote, the committee tabled Democrats' motions to subpoena Scully and Badger.
Late last month some Democratic senators asked U.S. Attorney General John Ashcroft to investigate Scully, saying he violated federal criminal statutes. Scully is already the subject of an HHS' office of inspector general's probe into whether he illegally ordered Foster to stay silent about administration estimates of the Medicare law's anticipated cost.
Some Republicans, as well as the companies that have hired Scully since he left the CMS, jumped to his defense. "We are besmirching the reputations of administrators who have served our country," said Rep. Nancy Johnson (R-Conn.).
Scully did not return calls last week but his name continues to dominate the Medicare debate on Capitol Hill.
An outspoken administrator during his tenure at the CMS-from the spring of 2001 to December 2003-Scully doesn't seem to have suffered professionally. Companies that appointed him to their boards, or hired him as an employee, remained confident in their decisions.
Alston & Bird, the high-powered law firm that hired Scully to work on health policy matters for its clients, "continues to be very proud to have Tom Scully working with us," said Ben Johnson, the firm's managing partner.
"We're confident any investigation of his conduct will support the proposition that he acted totally appropriately throughout his service in the government. ... I'm unaware of any client who has raised any question about his service, his capability or his integrity," Johnson said.
"It goes with the territory when you have high-profile people invited to serve on your board that you're usually quite cautious to make sure they can focus the time and creativity that caused you to be interested in them," said James Rice, vice chairman of the Governance Institute. In "getting too busy or distracted by lawsuits, it's conceivable they wouldn't be able to focus their creativity and energy" on the job, said Rice, who has not closely followed recent developments with Scully.
Select Medical Corp., an operator of 79 specialty hospitals, appointed Scully to its board in February. "We do continue to have confidence in Mr. Scully and he will continue to serve on our board," Robert Ortenzio, Select's president and chief executive officer, said through a company spokesman. "In terms of the controversy surrounding Mr. Scully, we only know what we've read in the papers and don't have any comment."
A spokeswoman for Ardent Health Services, which owns 23 hospitals, said the company is "monitoring this just as we would any Medicare situation," and that she had no concern about Scully's reputation. Scully joined the board in February.