Medicare agency adds ex-Va. official, plans reorganization

The Centers for Medicare and Medicaid Services (CMS) has tapped a former top health official from Virginia for a senior leadership position and plans its first structural reorganization in nearly 10 years.

Marilyn Tavenner, who was secretary of Health and Human Resources in the administration of then-Virginia Gov. Tim Kaine (D) from 2006 until Gov. Bob McDonnell (R) took office this year, has joined CMS as principal deputy administrator, a newly created position that makes Tavenner the second-ranking official at the agency -- and the Obama administration's most senior appointment to the agency.

Prior to her tenure under Kaine, Tavenner was a nurse and an executive at the Hospital Corporation of America, where she ran two facilities in suburban Richmond and served as chairwoman of the Virginia Hospital Association and a trustee at the American Hospital Association.

Obama, however, has yet to nominate anyone to serve as administrator of CMS. The agency has not had a confirmed chief executive since Mark McClellan resigned in Oct. 2006. President George W. Bush's last nominee for CMS administrator, Kerry Weems, served on the job in an acting capacity for more than a year but the Senate never took action on his confirmation. Since Obama took office, CMS's chief operating officer Charlene Frizzera, a veteran civil servant, has been acting administrator.

The agency has more than 4,400 employees, a annual budget that exceeds $670 billion and a duty to provide healthcare to roughly 98 million people enrolled in Medicare, Medicaid or the Children’s Health Insurance Program (CHIP).

In addition to hiring a new senior executive, CMS also plans to reorganize its component centers, Frizzera told agency staff in an email Tuesday. Health and Human Services Secretary Kathleen Sebelius has not approved the reorganization yet but Frizzera wrote she expects it to take effect within 60 days.

The new structure involves the creation of Tavenner's position, an Office of External Affairs and Beneficiary Serves that combines existing department, and reorganizes the three centers that oversee Medicare, Medicaid and CHIP. The leaders of those centers will carry the title "deputy administrator," not "director" as they now do. Under the realignment, the programs will be managed by the Center for Medicare, the Center for Medicaid, CHIP and Survey and Certification, the Center for Program Integrity and the Center for Strategic Planning.

The agency has hired Peter Budetti as deputy administrator at the Center for Program Integrity. Budetti was an aide to Rep. Henry Waxman (D-Calif.) from 1984-1990 when Waxman was chairman of the Energy and Commerce Committee's Health and the Environment Subcommittee. Budetti was the founder and director of the Center for Health Policy Research at the George Washington University from 1990 to 1995 and most recently was the chairman of the Department of Health Administration and Policy in the College of Public Health of the University of Oklahoma Health Sciences Center. Budetti is a pediatrician and a lawyer.

Read acting CMS Administrator Charlene Frizzera's email to agency staff:

From: CMS_BroadcastTo: CMS - All_Email_Users
 
Sent: Tue Feb 16 18:04:34 2010
 
Subject: CMS Realignment
 
CMS is firmly committed to its mission of ensuring effective, up-to-date health care coverage and promoting high value, quality care for our beneficiaries.  We are very fortunate to have dedicated employees who are passionate about CMS’ mission and who work tirelessly to achieve it.  Medicare, Medicaid, and the CHIP program now provide health insurance coverage to over 90 million Americans—a number that is expected to grow in the coming years.  As part of our commitment to providing quality care and quality customer service to all people who rely on our programs, we continuously seek more effective ways of operating in order to meet the health care needs of our beneficiaries.
 
In order for CMS to most effectively meet today’s requirements and strategically position itself for the future, the Agency is announcing a proposed modest realignment, consolidating and integrating functions which allow the Agency to better focus on three key areas:  beneficiary services, program integrity, and strategic planning.
 
The proposed structure will establish:
 
∙         The position of the Principal Deputy Administrator,
∙         The Office of External Affairs and Beneficiary Services, and
∙         Four Centers led by Deputy Administrators (Center for Medicare; Center for Medicaid, CHIP and Survey & Certification; Center for Program Integrity; and Center for Strategic Planning).
 
As part of this movement forward for the agency, I am pleased to announce two new additions to CMS. Marilyn Tavenner will be joining us as the principal Deputy Administrator, and Peter Budetti will be joining us as the Deputy Administrator for Program Integrity. Their bios are included at the end of this email.
 
Please find below brief descriptions of the realigned areas:
 
∙         The Center for Medicare combines Medicare fee-for-service, managed care, and the prescription drug benefit. The Center will report directly to the Administrator and be led by the Deputy Administrator, Jonathan Blum, and two Deputy Center Directors. Existing groups/staffs of the current Center for Medicare Management and Center for Drug and Health Plan Choice will be realigned intact under the new Center.
 
∙         The Center for Medicaid and State Operations (CMSO) is renamed the Center for Medicaid, CHIP and Survey & Certification. The Center will report directly to the Administrator and be led by the Deputy Administrator, Cindy Mann, and two Deputy Center Directors. Existing groups/staff will remain in the renamed Center except for the Medicaid Integrity Group, which will be realigned under the Center for Program Integrity.
 
∙         The Center for Program Integrity realigns the (Medicare) Program Integrity Group of the Office of Financial Management (OFM) and the Medicaid Integrity Group of the Center for Medicaid and State Operations (CMSO). The Center for Program Integrity will report directly to the Administrator and be led by the Deputy Administrator and the Deputy Center Director. The two groups will move intact under this Center and be renamed the Medicare Program Integrity Group and the Medicaid Program Integrity Group, respectively.  As mentioned above, Peter Budetti will serve as the Deputy Administrator for Program Integrity.
 
∙         The Center for Strategic Planning realigns the Office of Research, Development, and Information (ORDI) and the Office of Policy (OP). This Center will report directly to the Administrator and be led by the Deputy Administrator.  Existing groups/staff in ORDI and OP will be realigned intact under this new Center.
 
∙         The Office of External Affairs & Beneficiary Services realigns the Office of Beneficiary Information Services (OBIS) with the Office of External Affairs (OEA), thereby allowing CMS to integrate and better leverage its communication, call center and web resources; ombudsman services; and extensive network of partners to enhance service to beneficiaries. This Office will report directly to the Administrator and be led by the Office Director, Teresa Niño, and two Deputy Office Directors. Existing groups/staffs in OBIS and OEA will be realigned intact within the new Office.
 
The following five Offices will remain intact and continue to report directly to the Administrator:  Office of Equal Opportunity and Civil Rights (OEOCR); Office of Legislation (OL); Office of the Actuary (OACT); Office of Clinical Standards and Quality (OCSQ); and Office of Strategic Operations and Regulatory Affairs (OSORA), which will be renamed the Office of Executive Operations and Regulatory Affairs (OEORA) to more accurately reflect the work of that organization. In addition, the realignment formalizes the current role of the Chief Operating Officer (COO) and the Deputy (DCOO) with responsibility over all Agency operations; namely, information systems, contracts and grants, finance, e-health standards and services, human capital management and the Consortia.
 
Lastly, I will continue to serve in the role of Acting Administrator and Chief Operating Officer.
 
Although this realignment has not been through the clearance process, and not yet signed by the Secretary, we wanted to share this proposal with you today.  I expect the approval and effective date of the realignment to occur within the next 60 days. During this time, I wanted you all to be aware of what is being proposed, knowing that I fully appreciate that realignments—no matter how small—can be a cause for questions and concerns for employees.
 
Please be assured that each of you will be kept informed throughout the process.  Your Center/Office/Consortia leadership will also continue to keep you informed of specific aspects relative to your organization.
 
This realignment will help CMS do our job better and help to improve service and quality for the millions of people who depend on our services.  We know we can count on your support, as always, to move this Agency forward in the critical work that we perform for the Nation.
 
Thank you,
 
 /s/ Charlene M. Frizzera
Acting Administrator and Chief Operating Officer