NE Washington News

Lawmakers are calling on the Government Accountability Office (GAO) to review the Medicare Part D Premium Stabilization Demonstration recently announced by the Centers for Medicare & Medicaid Services (CMS), noting its dubious legality and the danger it poses to health care affordability for seniors. The effort comes as part of a letter to GAO from House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA), Senate Finance Committee Ranking Member Mike Crapo (R-ID), and House Ways and Means Committee Chair Jason Smith (R-MO).

Through new taxpayer-financed policy adjustments, the demonstration seemingly intends to deflate seniors’ premiums that are otherwise slated to increase dramatically following the counterintuitive, haphazardly-written Inflation Reduction Act’s drug price provisions. However, the agency has not produced any budgetary analysis and appears to lack a clear statutory basis or credible research goals for the proposal. Rodgers, Crapo, and Smith request GAO review the demonstration’s legality under section 402 of the Social Security Amendments of 1967; what budgetary analysis CMS undertook in developing the demonstration; and the estimated budgetary impact of the demonstration.

From the letter:

“We write to request that the Government Accountability Office (GAO) conduct an expedited review of the Part D Premium Stabilization Demonstration, as announced by the Centers for Medicare & Medicaid Services (CMS) on July 29, 2024. In response to the Inflation Reduction Act’s (IRA) problematic design features and rushed legislative process, the proposed demonstration employs arbitrary policy levers to achieve short-term objectives. The initiative lacks any budgetary analysis, clear statutory basis, or credible research goals. The integrity of the Medicare program and the taxpayer dollars that finance its benefits demand more than partisan aspirations to justify extra-statutory, eleventh-hour policy changes."

“[T]he policies advanced through the recently announced demonstration would simply shift costs from plan sponsors and enrollees to taxpayers, obscuring the law’s impacts without addressing their underlying drivers. Moreover, consideration of these types of programmatic changes should fall within the purview of the legislative branch. Instead, however, this agency action seeks to sidestep Congress, waiving statutory directives under the guise of a ‘demonstration project,’ with no meaningful research aims, budgetary assessments, or empirical rigor.”