Obama Administration to Humana - “Do you need a gag order?” - Humana Letter wreaks havoc
Insurers and Republicans react to the Obama administration’s criticism of letters about health care reform from insurance companies, including Humana, to seniors. The Associated Press reports: “Republican lawmakers rebuked the Obama administration Tuesday for telling health insurance companies to stop warning elderly customers about proposed health care legislation, which some equated to a gag order.”
“GOP leaders said the companies, whose income could be reduced by the legislation, are entitled to free speech and political debate. Tuesday’s exchanges came as a Senate committee began debating a health care bill most Republicans oppose. President Barack Obama supports the bill’s main provisions, and the flap over insurance companies’ mailers is the latest front in a long-running dispute. The Centers for Medicare and Medicaid on Monday sent a notice to all companies that sell private Medicare coverage and stand-alone drug plans to seniors. Saying at least one insurer was misleading those customers about the proposed legislation, it told the companies ‘to immediately discontinue all such mailings to beneficiaries and to remove any related materials directed to Medicare enrollees from your Web sites.’ … Federal subsidies to private Medicare plans average about 14 percent higher than those involved in traditional fee-for-service Medicare coverage. The health care bills pending in Congress would reduce or eliminate the difference” (Babington, 9/22).
Wall Street Journal/Dow Jones reports: “Senate Minority Leader Mitch McConnell, R-Ky., on Tuesday defended Humana, saying that it is ‘a common sense conclusion’ that Medicare Advantage benefits could be cut under the legislation. … Humana is located in Louisville, Ky., which McConnell acknowledged in his speech. Rep. Dave Camp, R-Mich., the top Republican on the House Ways and Means Committee, in a letter Tuesday to CMS, expressed concern that the agency may have ‘taken action for political purposes’ and ‘may be selectively and inappropriately using its regulatory powers.’ Camp called for CMS to end its ‘gag order’ against Humana and provide an explanation of its actions” (Yoest, 9/22).
The Louisville Courier-Journal reports: “McConnell, a Kentucky Republican and a persistent critic of the reforms proposed by President Barack Obama and congressional Democrats, said the government action threatened free speech. … [Humana] has given $19,000 to McConnell’s campaigns since 2000 and $12,000 to Baucus’ campaigns, according to Federal Election Commission records” (Carroll, 9/22).
The Washington Post reports: “The mailings in question urge enrollees to contact their congressional representatives and protest the legislation, the memo said. … A spokesman for America’s Health Insurance Plans, the industry’s main lobbying group, issued a statement Tuesday criticizing what he described as the government’s ‘gag order.’ ‘Seniors have a right to know how the current reform proposals will affect the coverage they currently like and rely on,’ AHIP spokesman Robert Zirkelbach said” (Hilzenrath, 9/22).
Yesterday’s Daily Report also included related Humana news.
According to an ABC report:
ABC’s Z. Byron Wolf reports: Democrats announced yesterday that HHS was investigating whether the insurer Humana was misleading seniors about health reform legislation. And CMS, the government entity within HHS that administers Medicare told Humana, in no uncertain terms, to cease and desist lobbying its customers on health reform legislation.
But today Republicans accused the White House and CMS of trying to implement a “gag order” on insurance companies that provide Medicare Advantage programs.
Senate Minority Leader Mitch McConnell does not normally get riled up, but he just gave an impassioned speech on the Senate floor about the gag order, Humana, and Senate Finance Committee Chairman Max Baucus, who initiated the HHS investigation. McConnell referred to Baucus only as “a colleague.”
“Using the full weight of the federal government’s enforcement powers to stifle free speech should trouble all Americans — and all of us — even more,” McConnell said. “We cannot allow government officials to target individuals or companies because they do not like what they have to say.”
“Shut up! the government says,” said McConnell on the Senate floor of the CMS letter to Humana. “Don’t communicate with your customers. Be quiet and get in line,” he said facetiously.
There are two points to remember here. Humana is based in Kentucky, so McConnell is quick to protect them. And second, he is a staunch defender of the first amendment. For instance, McConnell is the often the only Republican to vote against a flag burning amendment when it periodically arises.
In a written statement, House Minority Leader John Boehner calls a letter of rebuke from CMS Humana “outrageous” and accuses the White House of “trying to keep seniors in the dark about the consequences of congressional Democrats’ costly government-run health care bills.”
“Would the Administration impose this sort of gag order if seniors were being given information promoting the Obama health care plan? I don’t think so,” says Boehner in the statement. “Seniors have a right to know about the cost and consequences of the Democrats’ health care bills, and Republicans will continue to tell the American people the facts about the nearly $500 billion in Medicare cuts that Democrats are proposing.”
CMS told Humana in its own letter yesterday, not to lobby its customers on the issue.
“CMS is concerned that, among other things, this information is misleading and confusing to beneficiaries, represents information to beneficiaries as official communications about the Medicare Advantage program, and is potentially contrary to federal regulations and guidance for the MA and Part D programs and other federal law, including HIPAA. As we continue our research into this issue, we are instructing you to end immediately all such mailings to beneficiaries and to remove any related materials directed to Medicare enrollees from your website,” according to a letter addressed from Teresa DeCaro, a CMS employee, to executives at Humana.
In its mailer to people enrolled in Humana Medicare Advantage programs, Humana said bills being considered in Washington include cuts to Medicare, Medicaid and Medicare Advantage programs.
Saving costs by making Medicare more efficient and cutting down on fraud in Medicaid are key sources of revenue Democrats envision paying for their health reform overhaul.
Humana admits in its letter that Medicare and Medicaid need to be run more efficiently, but adds, “if the proposed funding cut levels become law, millions of seniors and disabled individuals could lose many of the important benefits and services (emphasis theirs) that make Medicare Advantage valuable.
The insurer also entreats its members to join a “partner” program to get information from Humana about health reform and to contact their Congressman about how important Medicare Advantage is. It is that last part, lobbying, that most frustrated the Democrats.
UPDATE: There has been swift and vocal pushback to this Humana flap by Democrats. It has more to do with the assertion that healthcare bills will cut Medicare benefits than it does with the gag order.
“As indefensible as it is for insurance companies to send out propaganda for the sole purpose of scaring our nation’s seniors, those who have been paying attention shouldn’t be shocked,” said Jim Manley, spokesman for Senate Majority Leader Harry Reid. “Insurers have spent millions of dollars to keep in place a system that is breaking the backs of American families with their skyrocketing costs and unfair practices. It’s clear that we are closer than ever to meaningful reform because defenders of the status quo are ginning up lies and scare tactics to stand in the way of fixing our broken system.”
And the Democratic Senatorial Campaign Committee pointed out that McConnell has taken a fair bit of campaign coin (more than $112,000 over his decades-long career).
“Mitch McConnell’s full-throated defense of one of the insurance giants seeking to kill health care reform may be unseemly, but it is certainly not surprising given all the Humana money lining his coffers,” said DSCC spokesman Eric Schultz.
Most to that point is what one Democratic staffer said.
“When my car insurer sends me a notice it is about my deductible not what congress is doing. Humana has plenty of outlets to express their view of potential legislation. They hire armies of lobbyists,” said the staffer. “Finally the information they were providing was misleading - there are ZERO changes to the benefits that Medicare participants are entitled to under the law in this bill.“
The distinction here is what constitutes a cut versus a cost saving. Health reform is financed largely by Medicare and Medicaid cost savings. The government will not cut any Medicaid benefits, but they will cut how much money they pay doctors and hospitals for services, etc, potentially affecting benefits in the future.
And Medicare Advantage plans are another separate issue. These privately administered Medicare-plus other benefits plans are an alternative to the fee-for-service that seniors on normal Medicare receive. They also cost the government about 14 percent more per person.
What do you think about the Obama Administration trying to “gag order” Humana?
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