Under Clinton, Medicare providers still had free speech

At the behest of Senate Finance Chairman Max Baucus, D-Mont., the Obama administration has barred insurers from communicating with their customers about the damage that Baucus's health reform bill could do to their Medicare Advantage plans.

The decision was announced by one of Baucus's former staffers, who is now acting director of an agency within the Center for Medicare and Medicaid Services (CMS).

But despite Baucus's pique over the insurers' mailers, no such ban on private Medicare providers' political speech existed in the past. In a 1997 letter sent by one of President Clinton's Medicare officials, insurers were told they could freely inform their Medicare customers about legislation and get them involved politically, on the grounds of “basic freedom of speech and other constitutional rights.”

The current controversy began this week when CMS ordered the insurer Humana to stop writing the customers of its Medicare Advantage plan to inform them of how some health care reform proposals could result in their benefits being cut or eliminated.

Medicare Advantage (also known as Medicare Part C) is a program under which private insurers cover about 9 million Medicare enrollees, or about 20 percent of the total. In exchange for a fee from the government and the right to collect premiums from customers who choose it, the insurers assume the risk of tending to those patients' health, generally offering more generous benefits than traditional Medicare.

Jonathan Blum, a former professional advisor to Baucus on the Finance Committee and now the acting director of the Center for Drug and Health Plan Choices, was quoted in the press release that explained the administration's decision to block Humana's communications with customers.

“We are concerned that the materials Humana sent to our beneficiaries may violate Medicare rules by appearing to contain Medicare Advantage and prescription drug benefit information, which must be submitted to CMS for review,” Blum said in the release. “We also are asking that no other plan sponsors are mailing similar materials while we investigate whether a potential violation has occurred.”

But the man who held Blum's position in the Clinton administration wrote a letter on July 10, 1997, that directly contradicts his position. Bruce Fried, director of what was then called the Center for Health Plans and Providers, wrote the letter at a time when a Medicare HMO wanted to do almost exactly what Humana is doing now — to sign up its Medicare customers as members “to become involved in lobbying activities.”

Prohibiting such information would violate basic freedom of speech and other constitutional rights,” wrote Fried. He also noted, however, that such communications “must contain the following statement, printed in a font size of 12 point or larger: 'Neither the Health Care Financing Administration nor the Medicare program has reviewed the statement below for accuracy or misrepresentation.'”

Rep. Dave Camp, R-Mich., who unearthed the 1997 letter, today called Blum's action a reversal of precedent and criticized the Obama administration for indulging Baucus's intimidation of Humana.

“The White House is clearly trying to keep seniors from learning the facts about their proposed Medicare cuts,” Camp said in a written statement. “Reversing precedent and abusing the federal government’s regulatory authority to restrict the constitutionally protected flow of information is wrong and unethical.”

Republican Senators Chuck Grassley, Iowa, and Mike Enzi, Wyo., wrote their own letter today to Health and Human Services Secretary Kathleen Sebelius, asking her to rescind CMS's gag order.

Beltway ConfidentialUS

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