GAO Report: The Obama Administration’s $8 Billion Extralegal Healthcare Spending Project

Witness and Testimony Documents
Deputy Administrator and Director
Center for Medicare
Director, Health Care
U.S. Government Accountability Office
Managing Associate General Counsel
U.S. Government Accountability Office
July 25, 2012,

9:30am in 2154 Rayburn House Office Building

Obamacare was rushed through the House of Representatives and Senate by the Democratic majority in each chamber.  Many conceded they did not even read its entire contents, choosing instead to learn about the bill’s consequences after the fact.  One of those consequences is major cuts in the popular Medicare Advantage program serving seniors.  These cuts mean many seniors will lose coverage that they enjoyed prior to the law’s enactment.

Acknowledging the politically unpleasant nature of these cuts, and acting in the wake of the 2010 mid-term elections, the Obama Administration announced plans for an unprecedented demonstration project to restore most of the law’s cuts for the period immediately before the 2012 election.  The Administration appears to have been worried that seniors would revolt against the law’s cuts to Medicare Advantage.

It now appears the Obama Administration enacted this demonstration without adequate legal authority or proper construction of a true demonstration project.  The project will not produce useable data and was implemented on a massive scale—larger than all other pilot programs combined.  This can be seen as nothing more than a wholesale remake of Medicare Advantage by fiat, not legislative instruction.  The government’s own non-partisan watchdog—the Government Accountability Office—has pointed out these flaws and called for its immediate cancellation.

The public has a right to know: was this demonstration in fact designed to offset Obamacare’s massive cuts to Medicare Advantage ahead of an election, and was the Administration playing politics with seniors healthcare.  Today’s hearing will shed light on these issues and begin the process of holding accountable to the public those unelected decision-makers who took these actions.