By Julian Pecquet and Bob Cusack - 01/19/11 11:12 AM EST
Medicare’s chief actuary, a referee in the contentious healthcare reform debate, says he won’t hesitate to strike back at anyone who twists his analysis of the controversial law.
Throughout his career, Richard Foster’s cost estimates of healthcare legislation have been used by both parties as political ammunition. Foster knows that comes with the job, but that doesn’t mean he has to like it.
In an hourlong interview with The Hill, Foster frowned at the tone of political discourse in the nation’s capital.
“To have results that are dismissed because they’re inconvenient, or exaggerated as to what their meaning is, I think society at large could do without that,” Foster said. “I could do without that.”
The 62-year-old holds a unique post within the executive branch, one that is completely nonpartisan. He has the freedom to publicly counter claims made by top-ranking administration officials, an authority he uses from time to time.
Foster works at the headquarters of the Centers for Medicare and Medicaid Services (CMS) in Baltimore, 40 miles north of Capitol Hill. It is likely Foster will be making the drive down to the nation’s capital many times this year as the new House Republican majority holds hearings on the healthcare law, which it calls “ObamaCare.”
Foster is soft-spoken, though at 6 feet, 6 inches, he doesn’t exactly blend in. He fiercely defends the work of his office, composed of about 85 people, and fights to maintain distance from political appointees.
Neither Congress nor the administration has asked him for an estimate of the Republicans’ healthcare repeal bill, which will be debated on the House floor on Wednesday.
He added that a cost estimate of the legislation “would take a long time” because of all the provisions that have gone into effect since the law’s enactment on March 23.
While the Congressional Budget Office (CBO) is Capitol Hill’s official scorekeeper, Foster’s projections of healthcare legislation play a prominent role in health debates.
In 2003, for example, Democrats noted that Foster’s estimated price tag for President George W. Bush’s prescription drug program was significantly higher than the CBO’s. Last year, Republicans touted Foster’s projection that President Obama’s health overhaul would increase healthcare spending over 10 years, with the total cost of national coverage provisions totaling $828 billion.
Foster consults with the CBO on occasion, but for the most part, their analyses are completely separate.
“[CBO Director] Doug Elmendorf and I have joked on occasion that they’ve got their estimates, we’ve got our estimates … and there’s every possibility that we will both be wrong to some degree or another.”
Republicans have jumped on some of those discrepancies to justify their decision to introduce a repeal bill that isn’t paid for. The CBO recently concluded that repealing the healthcare reform law would increase the deficit by $230 billion over 10 years.
Foster has made it clear that his office has not looked at the repeal bill’s effect on the deficit. Rather, his estimate found that the law would increase national healthcare spending by $311 billion between 2010 and 2019.
“It’s easy to confuse the impact of the health reform on the federal budget deficit and the impact on total health spending in the U.S.,” Foster said. “We did not try to estimate the effect on the overall budget deficit, because we don’t have the expertise to estimate all the tax provisions.”
Foster famously threatened to resign during the 2003 Medicare prescription drug debate after then-CMS chief Thomas Scully ordered him not to respond to congressional requests. There was concern from within the administration that if Foster’s cost estimate became public, the bill would not have passed Congress.
In the end, Foster’s colleagues persuaded him to stay on. Asked if he believes he made the right decision, Foster responded, “Yes,” adding with a laugh, “Most of the time.”
The Obama administration has respected his cherished independence, according to Foster.
“There hasn’t been a matter of principle here yet,” said Foster, who has been in his post since 1995. “And you resign over matters of principle.”
Still, Foster has had his share of differences with the Obama White House.
One disagreement occurred in September with Office of Health Reform Director Nancy-Ann DeParle, who formerly headed CMS.
DeParle wrote a blog post asserting that Foster’s cost analysis showed spending per insured person would be more than $1,000 lower in 2019 thanks to the reform law.
Foster usually talks to reporters on a not-for-attribution basis, but a reporter for The Associated Press writing about DeParle’s claim pressed him for an on-the-record quote. Foster obliged.
“The amounts quoted in the White House blog are not meaningful and cannot be used to calculate the change in health expenditures per insured person,” Foster told the AP at the time.
Pressed about his decision to publicly dispute the administration’s numbers, Foster said, “Normally, my preference is to assist journalists on background. I don’t need to be in the limelight. I thought the situation [with DeParle’s post] merited it.”
The Hill’s interview with Foster was conducted with a CMS press official listening in via teleconference. The press aide did not balk at any of The Hill’s questions, or Foster’s answers.
Foster expressed disappointment that congressional Democrats did not send him their healthcare reform bills in time for his office to come up with his cost projections before the measure was voted on in the Senate and House.
“Really all through the process, at each stage, we never got the legislation in time and had enough time to estimate it before the vote actually occurred,” Foster said.
“The goal would have been to get them out ahead of time. After the fact is not terribly useful, but it was the best that we could do.”
As for healthcare repeal, while Foster hasn’t been asked to score the entire bill, he has been queried about its effects on the hospital insurance trust fund. His estimate, released Tuesday, found that repealing healthcare reform would shorten the life of the trust fund by 12 years, exhausting it by 2017 instead of 2029.
There is much uncertainty about how the health law will play out, Foster said, because “it changes almost everything” in the health sector.
He added, “As the provisions are implemented, people will undoubtedly be surprised from time to time because it won’t work exactly as we and others have been thinking.”
Foster also pointed out that his April estimate could be used by either party.
“There are many, many things in here that can be used to support the health reform legislation,” he said. “And there are a number of things that could be used to oppose it.”
During the 2003 controversy with the Bush administration, some in GOP circles surmised that Foster was a liberal seeking to score political points.
In testimony to the Ways and Means Committee around that time, Foster — while stressing that political preferences play no role in his estimates — noted he is a registered Democrat, but had “voted for every Republican candidate since 1972, except the one year I wrote in Jack Kemp.”