Critical Condition

The HHS Secretary’s Tough Call

HHS Secretary Sebelius and Jonathan Blum, director of CMS’s Center for Medicare Management, held a press conference today to talk about a CMS report that says the administration will see $575 billion in expected Medicare savings over ten years as a result of Obamacare, including $418 billion from measures that are already in the process of being implemented.

The secretary’s prepared remarks mainly summarized the report; the question period was much more interesting. The first question was on the district-court ruling in Virginia allowing the lawsuit challenging Obamacare’s constitutionality to proceed. In answering the question, Sebelius stuck mainly to the White House script, saying that it was just a procedural development with little substantive value.  After she answered the question, the second and third reporters, who had queued up electronically, sheepishly reported that their question had just been asked, indicating less than 100 percent interest from the mainstream reporters on the size and nature of Medicare savings.

Questions on the cost issue were posed by The American Spectator’s Phil Klein, who was relentless in asking how the administration could count the Medicare reductions as savings if they were being used to fund PPACA’s subsidies and exchanges. (Klein wrote up the exchange here). I am surprised the HHS press shop let Phil in to ask what was likely to be a less-than-friendly question, and I wonder if Sebelius’s flack is being flayed behind the scenes for having done so. In addition, it was initially Jonathan Blum who responded to the question, and it is a safe bet that he was handling the call instead of CMS administrator Donald Berwick because the administration did not want the call to open up a conversation on Dr. Berwick’s controversial views. This is another example of how the recess appointment of Dr. Berwick not only prevents him from doing his job the fullest degree possible but also causes the administration as a whole to suffer.

With no Berwick on the call, Blum took two cracks at Klein’s question, both times making the case that double-counting the money as Medicare savings and as new spending was a “budget convention” that was “longstanding” and “consistent.” Klein was having none of it, and on the third try Sebelius stepped in to help, which was noteworthy in itself — in politics, the subordinate is supposed to step in to help the superior, not the other way around. Sebelius blamed the CMS actuary — who, it should be noted, works for her — for the misunderstanding, saying that the actuary used a different “accounting methodology” from the rest of the government. Klein shows this is wrong, as CBO also considers Sebelius’s approach to be a form of double-counting, but the moderator finally noticed that the secretary was in trouble and cut Klein off. 

Aside from the fact that the exchange made for good theater, one has to wonder how the Medicare actuary feels about his boss’s defending herself by saying that her own staff is using the wrong accounting methodology. After this call, I suspect that the actuary should not expect a holiday card from Sebelius, and that Phil will not make it to the head of the line on future HHS press conferences.

Tevi Troy — Tevi Troy is the President of the American Health Policy Institute. He is also the author of the best-selling book, What Jefferson Read, Ike Watched, and Obama Tweeted: 200 Years ...

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