Jordan raises questions about CMS Demonstration Project

Full Committee on Oversight and Reform
Full Committee on Oversight and Reform
Published: May 23, 2019

WASHINGTON, DC – Today, Congressman Jim Jordan (R-OH), Ranking Member of the House Committee on Oversight and Reform, sent letters to the Department of Health and Human Services (HHS), the HHS Office of the Inspector General (HHS OIG), the Government Accountability Office (GAO) and the Office of Management of Budget (OMB) about a new “demonstration project” to cover the costs of proposed changes to how pharmaceutical benefit managers handle rebates within Medicare and Medicaid.The demonstration project would require taxpayers to assume 95 percent of any insurance company losses caused by the proposed rule.
Excerpt from the letter: 
“This is not the first time that HHS has sought to use a demonstration project to finance a taxpayer-funded bailout. As signed into law, Obamacare mandated drastic cuts to the Medicare Advantage program, which allowed Medicare-eligible seniors to choose a private health plan. In 2010, CMS announced an $8 billion demonstration project to subsidize the Medicare Advantage program through quality bonus payments. In a July 2012 letter to then-Secretary Kathleen Sebelius, the Government Accountability Office (GAO) raised concerns about the demonstration project and questioned HHS’s authority to initiate the project. This Committee conducted oversight of this bailout during the Obama Administration.”
Full text of the letters can be found here.