McClellan Nominated to Replace Scully

Published April 1, 2004

President George W. Bush has nominated Food and Drug Administration (FDA) Commissioner Mark McClellan to serve as the new Centers for Medicare and Medicaid Services administrator (CMS). If McClellan is confirmed by the Senate, the job will be the third senior health policy position McClellan has held in the Bush administration.

As CMS administrator, McClellan, a physician with a doctorate in economics, would be responsible for Medicaid and Medicare, which together provide about $700 billion annually in health care benefits to an estimated 83 million people.

McClellan would succeed Tom Scully, who resigned in December and accepted a position in the Washington DC office of the Atlanta-based law firm Alston & Bird.

Challenges Ahead

According to the New York Times, McClellan faces “a huge logistical and political challenge” in his new role: implementing the prescription drug benefit included in the Medicare reform law while fending off Democratic attacks.

McClellan “could face sharp questioning from Democrats” over “his stated faith in the ability of private-sector companies to reduce spending and improve quality of health care,” reported the Wall Street Journal.

While at the FDA, McClellan pushed for quicker reviews of drug and other product applications; successfully lobbied Congress to expand industry user-fee programs that fund FDA activities; and made tough decisions on controversial issues, such as banning the diet supplement ephedra and reversing an advisory panel decision to keep silicone breast implants off the market.

McClellan may be most well known for his steadfast position on the danger of reimporting drugs from Canada and other across-border sources. He has demonstrated a knack for working with members of both parties in a pragmatic way, blending economics, science, politics, and social issues.

Reaction to Nomination

Some expected McClellan to be confirmed quickly by the Senate. Observers say the nomination reflects the administration’s desire to avoid a bruising confirmation battle that would give Democratic lawmakers another opportunity to tear down Medicare reform.

Senator Edward Kennedy (D-Massachusetts) called McClellan “a superb choice” to run CMS, adding, “He brings to the job a powerful intellect, a deep knowledge of the programs, and a commitment to public service.”

Senate Finance Committee Chair Chuck Grassley (R-Iowa) said McClellan “is well regarded on Capitol Hill, and his background and expertise make him a strong candidate.” Grassley added he would schedule the confirmation hearing as soon as possible, but gave no date.

Jonathan Skinner, a Dartmouth economist who has written articles with McClellan, said that while “McClellan has strong opinions about how to make the system better, I think he understands that in Washington you try to get done what you can get done.”

Not everyone reacted so positively to the McClellan nomination, however. The Los Angeles Times quoted Dr. Sidney Wolfe, director of Public Citizen’s Health Research Group, warning McClellan “could become ‘a cheerleader for the privatization and serious weakening of Medicare because he might approach the job more as an economist than a physician.'”

McClellan’s potential departure from FDA also worried some. The Wall Street Journal editorialized, “With McClellan’s expected departure from FDA, the agency likely will once again return to bureaucratic autopilot, and to its institutional over-caution in approving even life-saving new drugs.”

The editorial concluded, “We hope Mr. Bush challenges the Senate with a replacement who is every bit as aware as Dr. McClellan has been of how bureaucratic delay costs lives.”

Bumpy Road Ahead

Senate Democratic Policy Committee Chairman Byron Dorgan (D-North Dakota) has threatened to hold up the McClellan nomination over a lingering dispute about prescription drug importation. McClellan has been firm in his position that importing drugs into the U.S. from other countries poses a risk to public health.

Speaking at a summit meeting of governors and members of Congress who support prescription drug importation from Canada and other countries, Dorgan said he wanted to know “what’s going on over at the FDA” on the issue. According to CongressDaily, Dorgan said McClellan’s nomination “is going to spend awhile” in the Senate.

If Dorgan follows through on his threat, it will be like old times for McClellan. Senator Jeff Bingaman (D-New Mexico) briefly held up McClellan’s nomination to his FDA position as part of a spat between Bingaman and HHS Secretary Tommy Thompson. Thompson had withdrawn his support for a Bingaman bill that would have made pregnant women, rather than fetuses, eligible for the State Children’s Health Insurance Program.

Conrad F. Meier is managing editor of Health Care News. His email address is [email protected].