[Congressional Record Volume 146, Number 33 (Wednesday, March 22, 2000)]
[Extensions of Remarks]
[Pages E384-E385]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


CONGRESSIONAL RESEARCH SERVICE'S MEMOS SHOW S. 1895 MEDICARE BOARD IS A 
                          RECIPE FOR DISASTER

                                 ______
                                 

                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                       Wednesday, March 22, 2000

  Mr. STARK. Mr. Speaker, S. 1895, the Breaux-Frist Premium Support 
proposal to change Medicare is a recipe for administrative disaster.
  Don't take my word for it. Following are quotes from two Library of 
Congress Congressional Research Service memos describing the many 
problems with S. 1895.
  Just ask yourself, in the history of the world, has the 
administration of a large program (and Medicare is spending about $220 
billion a year) ever been successfully accomplished by a committee of 
seven?
  As the ultimate Founding Father, George Washington said,

       . . . wherever and whenever one person is found adequate to 
     the discharge of a duty by close application thereto, it is 
     worse executed by two persons, and scarcely done at all if 
     three or more are employed therein.

  The full CRS papers are available from my office at 239 Cannon HOB, 
Washington, DC 20515 (202-225-5065).
  Following are other quotes from the studies.
  Describing how Medicare would be largely independent of the Secretary 
of HHS and the Administrator of HCFA, the CRS writes:

                          New, untested ideas

       This organizational and administrative design is somewhat 
     unusual when considered in light of traditional guidelines 
     regarding the effective administration of government 
     programs. These guidelines normally call for placing major 
     elements of a program in the same agency or department, and 
     lodging authority over the program in the head of the agency 
     or department, while authorizing the agency head to delegate 
     that authority.

                           *   *   *   *   *

       The Secretary of HHS and the administrator of HCFA appear 
     to be almost totally removed from any role regarding the 
     Division of HCFA-Sponsored Plans, although they would 
     apparently retain supervision and authority over the Division 
     of Health Programs.
       To a large extent, the proposed organizational and 
     administrative restructuring of the agencies that would be 
     administering the proposed Medicare program appears to depart 
     from the traditional guidelines for the administration of 
     government programs.


            Divided Administration: A Recipe for Confusion?

       The administration of the Medicare program is divided 
     between the board and the Division of HCFA-Sponsored Plans. 
     The fact that the Division must submit its sponsored plans to 
     the board for approval

  The CRS points out that OMB is the only independent agency 
``exercising considerable authority over other independent bodies . . . 
 as the President's surrogate . . .

       Even OMB, however, does not share or assume operating 
     authority over government programs assigned to other agencies 
     or departments.
       It is difficult to find an example where independent bodies 
     share administrative responsibility over a program, and where 
     one body may veto the plans of another, as with the board and 
     the Division of HCFA-Sponsored Plans.

  CRS writes:

           Who's In Charge Here? Where's the Accountability?

       Under S. 1895 the Secretary of HHS appears to be stripped 
     of supervisory authority over the Medicare Program and of 
     practically all authority over the Division of HCFA-Sponsored 
     Plans [even though that Division is within HHS and operating 
     under Federal laws].
       Apparently, the Secretary would retain supervisory 
     authority over only the Division's budget. Since the 
     Secretary would have no role to play in the Division's 
     activities, there is a possibility that its budget requests 
     might not receive much support compared to other agencies in 
     the Department.

  The CRS memo notes ``two of the most independent units existing 
within departments appear to be the Office of Comptroller of the 
Currency and the Office of Thrift Supervision,'' both in Treasury.

       . . . such independence generally is given only to 
     independent regulatory commissions that for convenience sake 
     are located within departments.

  But note, Mr. Speaker: Medicare is not just a regulatory program: It 
is an insurance program for 40 million people that spends $220 billion 
a year and processes nearly a billion medical claims a year.
  CRS writes:

[[Page E385]]


                             Why 7 Members?

       A further issue of authority and ease of decisionmaking is 
     raised by the seven-member composition of the proposed 
     Medicare Board. The current trend is to establish boards of 
     three to five members, because larger boards often experience 
     great difficulty in reaching a decision. Most recently, the 
     former Interstate Commerce Commission, which initially 
     consisted of 11 members, and was later reduced to five 
     members, was abolished and many of its functions were 
     transferred to a three-member Surface Transportation Board.


                            What President?

  The amount of independence granted the Medicare Board from the 
President and from congressional oversight is highly unusual and serves 
to limit the accountability of the board members . . .

       Presidential authority over one of the largest government 
     programs would . . . be severely limited, because the Chief 
     Executive would have virtually no authority over board 
     activities . . . Congressional influence and direction would 
     also be limited because the board, able to raise its own 
     operating funds, would not be subject to the yearly 
     appropriations process.


               Talk about Making HCFA More Unresponsive!

       It is rare for such agencies to be authorized to generate 
     their operating funds. Only a handful of such agencies, 
     nearly all involved with banking and financial matters, have 
     such authority.


                 In Conclusion, Let's be Anti-democracy

       Congress Sometimes departs from traditional guidelines 
     regarding what is considered the type of organizational and 
     administrative structure most likely to result in the 
     effective delivery of government programs. The proposed bill 
     restructuring the Medicare program, departing as it does from 
     those guidelines, raises questions because it would divide 
     program responsibility and authority between two government 
     entities, an independent Medicare Board and the Division of 
     HCFA-Sponsored Plans. Difficulties in administering the 
     program are more likely to arise and produce conflicts more 
     difficult to resolve when a program is divided between two 
     distinct federal entities than when located within one 
     entity. Additionally, there may be a problem when one of the 
     entities is located within a department and the head of the 
     department has little if any supervisory authority over that 
     entity. That situation may serve to separate the department 
     head from any problems that the entity may be experiencing 
     and make it less likely that he or she would be willing or 
     able to help resolve those problems. Finally, the amount of 
     independence proposed for the Medicare Board would make it 
     more difficult for the President to exercise guidance and 
     direction over the Medicare program, and for Congress to 
     provide guidance and direction to the board through its use 
     of the appropriations process.

     

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