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Acting Administrator Marilyn Tavenner has been nominated for the permanent post at the Centers for Medicare & Medicaid Services. CMS has been without a Senate-confirmed chief since 2006. Photo by AP / Wide World Photos

Goodwill likely to break long deadlock on CMS chief

Acting Administrator Marilyn Tavenner fields pointed questions on ACA implementation and entitlement reforms at the Senate hearing on her nomination for the permanent post.

By Jennifer Lubell — Posted April 22, 2013

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Senate lawmakers sought details from Marilyn Tavenner, acting adminstrator for the Centers for Medicare & Medicaid Services, on the impact of health system market reforms and revisions to public insurance at a committee hearing to consider her nomination as the official administrator of the nation’s public insurance programs. During the hearing, Tavenner said she would work in partnership with health care professionals and establish an “open-door policy” as part of her plans for the agency.

Tavenner has run CMS as acting administrator since 2011, when the term of her predecessor, Donald M. Berwick, MD, expired under the terms of the recess appointment that placed him in the post. The White House since has nominated her twice to take over officially the administration of the Medicare and Medicaid programs.

Addressing the Senate Finance Committee on April 9, Tavenner said her background as a nurse, hospital administrator and Virginia’s secretary for health and human resources gave her the clinical and business expertise to run the agency in the permanent post. Tavenner stressed that she wanted to operate CMS “as a business and act like business partners” with all interested stakeholders. This includes health care professionals, beneficiaries, insurance companies, states, lawmakers, advocacy groups, and the agency’s own contractors and employees, she said.

The American Medical Association has been among the groups that praised Tavenner’s ability to seek stakeholder input and understand issues from various perspectives. In supporting her renomination in February, AMA President Jeremy A. Lazarus, MD, said Tavenner was “the right person to lead CMS through the work of ensuring patients have access to high-quality care” and of achieving needed cost savings.

Lawmakers on both sides of the political aisle endorsed Tavenner’s abilities at the hearing, including House Majority Leader Eric Cantor (R, Va.), who made an appearance to support her nomination. “It’s no secret that I differ with the Obama administration on a lot of health care policy issues. But if there’s anyone I trust to try and navigate the challenges, it’s Marilyn Tavenner,” he said.

Sen. Orrin Hatch (R, Utah), the lead Republican on the Finance panel, also was confident that Tavenner could do the job. But he cautioned that there is “still much that you will need to do in order to assure members of this committee that CMS is heading in the right direction and that your leadership will help steer the agency through the very turbulent times that lie ahead.”

GOP questions ACA insurance costs

Implementing the Affordable Care Act’s federal and state-based health insurance exchanges is one of those challenges, Hatch said. Very little is known about how these marketplaces will operate, what their deadlines will be and how CMS is monitoring their progress. In addition, the Congressional Budget Office has estimated that 1 million fewer people might be signing up for these exchanges than previously thought, he said.

Hatch and Sen. Mike Enzi (R, Wyo.) raised pointed concerns about the costs associated with the exchanges and the impact on insurance premiums. This is of “critical importance to this committee, as we are already seeing evidence that health insurance premium costs are continuing to rise and are projected to be, on average, 32% higher in the individual market,” Hatch said in his opening remarks, referring to a recent report from the Society of Actuaries.

Enzi mentioned a discussion paper from the National Assn. of Insurance Commissioners, which outlined the steps states could take to mitigate expected rate increases when major market reforms under the ACA take effect starting in 2014. He asked for clarity on CMS plans to address the risks identified by these reports.

Tavenner responded that the ACA contained several provisions to mitigate rate increases, such as federal tax credits for lower-income people that could be applied to premiums, catastrophic coverage for individuals up to age 30 and dependent coverage up to age 26, as well as the ability of consumers to choose from a variety of plans in the exchanges. The health system reform law also invests billions of dollars into a reinsurance pool to help stabilize premiums, she said.

Responding to various requests from committee members, Tavenner said she would provide Congress with regular updates on the progress of exchange implementation.

Medicare and Medicaid reform

Several of the panel’s Democrats had questions for the nominee about reforming the Medicare and Medicaid programs. Some experts suggest that CMS isn’t moving quickly enough to transition from an agency with fee-for-service payments to a system that pays based on quality and patient outcomes, said Sen. Max Baucus (D, Mont.), the Finance panel’s chair. As an example, the agency could set a deadline stating that 10 years from now, 90% of payments will be based on quality measures, such as through accountable care organizations and bundled payments, Baucus said.

Tavenner said the health care industry, as well as consumers, actually has the opposite concern — “that we’re moving too fast.”

“What we’re trying to do is take a measured approach,” she said. The ACA gave CMS significant authority to move away from fee for service and toward paying for quality. “I think a lot of work has gone on in the last three years, and I’m proud of that work,” she said.

At this article’s deadline, neither the Finance panel nor the full Senate had scheduled a vote on the nomination.

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ADDITIONAL INFORMATION

Major responsibilities of CMS chief

The Obama administration has been unable to obtain Senate confirmation for a permanent administrator of the Centers for Medicare & Medicaid Services, relying instead on acting administrators and a recess appointment. The position includes overseeing myriad departments, contractors and employees at its Baltimore headquarters and in 10 regional offices. Job responsibilities of the administrator include:

  • Overseeing $820 billion in annual Medicare, Medicaid and other health-related spending.
  • Ensuring payment of 4.6 million Medicare claims worth more than $1 billion each day.
  • Working with states to modernize Medicaid programs.
  • Seeking out fraud and improving accuracy of payments for health care services by, for example, lowering Medicare’s 8.5% fee-for-service error rate.

Source: “Statement of Marilyn B. Tavenner,” Senate Finance Committee, April 9 (link)

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