Scully Acted Improperly, GAO Says

Washington

For the second time this year, Tom Scully, administrator of the Centers for Medicare and Medicaid Services, found himself under the microscope for allegedly compromising Medicare’s contract-procurement process. This time, the U.S. General Accounting Office stepped in to investigate and found that Scully’s actions regarding a nursing home survey contract were “improper.”

The GAO’s report, which focused on a September 2002 contract CMS awarded the RAND Corporation, found that Scully undermined the integrity of the contracting process by excluding RAND’s subcontractor — the University of Wisconsin’s Center for Health Systems Research & Analysis — from the contract.

While Scully insisted that he based his decision to exclude the Center on the Center’s poor performance on past and ongoing CMS contracts, the GAO found no evidence to support Scully’s claims. In fact, the GAO suggested that Scully’s decision appeared to be retaliation for the fact that the Center’s director, David Zimmerman, had raised concerns about another CMS initiative.

Citing an e-mail in which Scully told Zimmerman, “If you want to continue to yank my chain, I will continue to disconnect you from this agency,” the report recommended that CMS’ parent department act to “remedy the situation.” Specifically, the GAO asked the HHS to permit RAND to use the Center as a subcontractor and review all procurement decisions affecting the Center since September 2002.

CMS and HHS concurred with these recommendations but disagreed with the GAO’s assertion that Scully’s actions were improper.

The GAO’s report is available at http://www.gao.gov, under “Today’s Reports.”

In April of this year, the Gallup Organization filed a lawsuit in the U.S. District Court for the District of Columbia against Scully, alleging that the administrator interfered with the government’s contracting process by blocking a meeting between a Gallup officer and CMS’ partner, the Agency for Healthcare Research and Quality.

Are you ready for HIPAA? The Oct. 16, 2003, implementation deadline for compliance with HIPAA transactions and code sets is just around the corner. For guidance, the Centers for Medicare and Medicaid Services has a special section on its Web site devoted to HIPAA at www.cms.hhs.gov/hipaa/hipaa2. And, for the latest news and updates, read HomeCare Monday, the weekly e-newsletter for the HME industry. To subscribe, go to www.homecaremonday.com.

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