Senate GOP probes Treasury pick Lew’s failure to comply with Medicare law

Senate Republicans are demanding the administration hand over all documents related to Jack Lew's failure, when he was head of the Office of Management and Budget, to comply with a law aimed at ensuring Medicare's solvency.

The demand, led by Senate Budget Committee ranking member Jeff Sessions (R-Ala.), is the latest sign the GOP may be intent on building a case against Lew, who was tapped by President Obama earlier this month to replace Treasury Secretary Timothy Geithner. Lew has served most recently as Obama's chief of staff.

Most GOP senators haven't said how they would vote, but those who have are expressing reservations about Lew, who irritated Republicans during last summer's debt talks. Sessions has said Lew "must never" be Treasury secretary and has criticized the former top Obama aide for submitting budgets that failed to receive any votes in Congress.

Sessions has also accused Lew of misrepresenting Obama's 2012 budget by saying that it would not add to the debt, a claim the Alabama senator pegged as the "greatest financial misrepresentation in history."

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A Senate GOP aide said Lew's failure to comply with the Medicare law could stiffen opposition to Lew even further. This aide said there is a "growing sense" among Republicans that unless the administration adheres to this law, Obama will not find it easy to move Lew's nomination along.

Under current law, the president must submit a legislative proposal to Congress that resolves Medicare funding issues whenever the Medicare Trustees release a warning that the program is in financial trouble.

Funding warnings have been issued in each of the last four years, but Obama has not sent such legislation. When he was director of OMB, Lew was responsible for meeting this requirement.

"The administration has failed each of the last four years to respond to these funding warnings despite receiving several communications from Congress urging them to comply with his unambiguous legal requirement," the senators wrote to acting OMB Director Jeff Zients in a letter sent over the weekend. "In two of those four years, 2010 and 2011, Mr. Lew was the Director of the Office of Management and Budget, the entity directly responsible for drafting and submitting fiscal proposals to Congress and complying with federal budget law."

Republicans also noted that if Lew was to become the next Treasury secretary, he would be in charge of issuing Medicare solvency warnings. The Treasury secretary acts as the Chair of the Board of Medicare Trustees.

As a result, Republicans asked for all documents related to the administration's response to the "Medicare trigger" so that they may "properly consider Mr. Lew's nomination."

The letter also asked the administration to comply immediately with the law by submitting a "detailed legislative proposal responsible to the latest Medicare funding warning to bring the administration into compliance with federal law."

The letter was signed by Sessions, Sens. Kelly Ayotte (R-N.H.), Mike Crapo (R-Idaho), Mike Enzi (R-Wyo.), Lindsey Graham (R-S.C.), Chuck Grassley (R-Iowa), Ron Johnson (R-Wis.) and Roger Wicker (R-Miss.). Crapo, Enzi and Grassley serve on the Senate Finance Committee, which will have to approve Lew's nomination.

— Updated at 9:23 a.m.