Medicare Compliance & Reimbursement

Tom Scully is leaving his post as Centers for Medicare & Medicaid Services Administrator, effective Dec. 15.

In a Dec. 3 statement, CMS said an acting administrator would be named before the 15th. Names that have surfaced in Washington speculation about successors include acting deputy administrator Leslie Norwalk, Assistant Secretary of Defense for Health Affairs William Winkenwerder, MD, and Health and Human Services deputy general counsel Peter Urbanowicz.

The irrepressible Scully made a mark on just about every facet of his agency's substantial domain, including its name, which was the Health Care Financing Administration when Scully first arrived. Perhaps his most notable contributions - other than providing an endless series of provocative quotes that delighted reporters and sometimes gave his superiors heartburn - came in two areas.

First, Scully was a key part of the administration negotiating team that helped shape and pass legislation adding a prescription drug benefit to Medicare and increasing the role of preferred provider organizations in the program.

In pushing for that legislation, Scully and other administration figures often touted PPOs as able to provide higher quality, more innovative care than the allegedly moribund traditional Medicare program. Ironically, though, Scully's second key contribution involved using the power of traditional Medicare to spur quality improvement and the dissemination of information about outcomes and adherence to best practices.

Together with his boss, Health and Human Services Secretary Tommy Thompson, Scully overcame longstanding industry opposition and launched quality improvement and reporting initiatives in the skilled nursing facility, home health, and hospital industries. In the hospital industry, Scully and CMS teamed with Premier on a demonstration program that will increase Medicare payments for the best performers and potentially cut payments for the worst-performing hospitals.

In a Dec. 3 conference call, Scully said that in recent months he has had "informal" employment-related conversations with several legal and investment firms. Some of these firms, directly and through clients, benefited from provisions in the Medicare legislation, and several liberal-leaning groups have criticized Scully for at least the appearance of conflicts of interest.

But the CMS administrator vigorously defended his actions and said he had followed all applicable rules scrupulously.