The Obama administration is fighting to save its health-care reform law in the Supreme Court and the president is defending it on the campaign trail, where Republican candidates are promising to kill the Affordable Care Act. Yet even if President Obama prevails, he’s got a big problem: The agency that must implement the law has a revolving door at the top.
Since its creation in 1977, the Centers for Medicare and Medicaid Services (formerly called the Health Care Financing Administration) has had 29 administrators — with an average tenure of just 14 months. The longest-serving administrator held the job for four years and five months. The shortest terms were a few weeks. The CMS’s most recent acting administrator, Donald Berwick, stepped down in December after 16 months — and acting administrators have run the agency for more than seven of its 35 years. The Senate hasn’t confirmed a full-time administrator since 2006, a problem that Thomas A. Scully, a CMS administrator under President George W. Bush, once likened to going two years without a secretary of defense.
Never heard of the CMS? It’s the agency charged with making the Affordable Care Act, known as “Obamacare” to critics, work by drafting regulations and providing oversight. With a budget of $820 billion, the CMS is one of the largest purchasers of health care in the world, paying for services for one in three Americans and interacting daily with thousands of hospitals, doctors and other providers. But for years, Congress has undermined the agency’s authority and, on the eve of historic change, has left it without a permanent leader.
Changing leadership isn’t the agency’s only problem. For decades, the gap between the CMS’s responsibilities and its resources has widened. In 1999, a group of former administrators and health policy experts wrote an open letter to Congress decrying the “mismatch” between the CMS’s resources and its “mammoth assignment.” The number of Medicare and Medicaid beneficiaries has soared since the programs started in 1966, with tens of millions of baby boomers expected to swell the rolls in coming years. Yet the agency has the same number of employees it had during the Carter administration — about 4,900. By comparison, the Social Security Administration, with a smaller budget, has 62,000 workers.
Still, the CMS is trying to get its job done. In an interview, Berwick, a physician and expert on health-care quality, said he was “impressed and gratified” by the way his staff rallied around his call to implement Obama’s sprawling initiative. The administration’s two-year-old law brings the agency significant new responsibilities: helping oversee insurance exchanges in 50 states, finding ways to deliver care more efficiently, and guiding changes to and expansions of the agency’s core programs.
In fact, Congress has been putting more on the agency’s plate for years. The CMS has had to oversee a 2003 prescription-drug benefit for seniors, ensure patient privacy, help weed out waste and fraud, and develop a system for grading hospitals and nursing homes. Meanwhile, it has been criticized for focusing more on getting checks to hospitals and doctors than on ensuring quality or finding ways to trim health spending.
“It’s almost paradoxical,” said Bruce Vladeck, an administrator appointed by President Bill Clinton. “Medicare is so important and valued in the lives of so many families and communities, and the overwhelming communication the people running the program get is hostility.”
Gail Wilensky, who ran the agency for two years under President George H.W. Bush, said the CMS has become a much more sophisticated operation. “It’s not just a check-writing agency anymore,” she said. But the turnover at the top sends the wrong message to employees, who she said respond by being “more inward and protective.”
So why didn’t the Senate, which confirms CMS administrators, put someone in charge? Berwick, whose name surfaced as a potential leader shortly after Obama’s election, seemed a good choice. A pediatrician, he steered the nationally recognized Institute for Healthcare Improvement, a nonprofit near Boston. Obama waited to submit his name until April 2010, one month after passage of the health-care law. By then, Republicans were openly attacking the legislation, so the president appointed Berwick during the congressional recess that July.
This recess appointment avoided what many predicted would be a losing battle with Senate Republicans. Some in the GOP accused Berwick of promoting rationing after he made favorable comments about the British National Health Service. Sen. Pat Roberts (R-Kan.), for example, said Berwick’s focus on cutting costs would lead to a rural health system consisting of “a Band-Aid and a bedpan.” Berwick, meanwhile, said in an interview that Republicans “twisted and distorted” his words and used the agency as a political football.
“What happens, I think, when you have a lot of turnover is senior staff loses its confidence and is less willing to take risks,” Berwick said, adding that the churn in administrators “demoralizes and confuses” staff members. As for the GOP: “It’s a game to them,” he said.
Without a hearing, Berwick had little choice but to resign. His term as acting administrator expired at the end of 2011, and 42 Republican senators had announced their intention to block his confirmation. Within days, Obama nominated Berwick’s replacement as acting administrator, Marilyn Tavenner, a former Virginia health official and executive with the for-profit Hospital Corporation of America.
Several prominent Republicans, including House Majority Leader Eric Cantor (Va.), said Tavenner is “eminently qualified” to run the CMS. But months later, she still hasn’t gotten a hearing. Amid the heated politics of an election year, some wonder if she ever will.
Gilbert M. Gaul, a former Washington Post reporter, contributes to Kaiser Health News, an independent program of the Henry J. Kaiser Family Foundation. The foundation is not affiliated with Kaiser Permanente.