Bush Medicare Ads Are Misleading But Not Illegal, GAO Says

While the Bush administration's taxpayer-funded ad campaign to promote the new Medicare law is not technically illegal, it contains "omissions," overstatements, and has a "political tone," according to a legal opinion issued by the General Accounting Office's (GAO) general counsel.

The Bush administration launched the $22 million advertising effort -- which includes fliers mailed to all 41 million Medicare beneficiaries and a $9.5 million television ad campaign -- to rebut criticism of the new Medicare law. The 30-second television ad, titled "Same Medicare. More Benefits," addresses some of the major criticism of the law, including charges that it will force seniors out of traditional Medicare and into managed care plans and that savings from the law's prescription drug coverage will be insignificant.

The ad was denounced by Democratic lawmakers and a range of interest groups who say it is a thinly disguised commercial for President Bush's re-election campaign. (See "Groups Decry Taxpayer-Funded Bush Ad on Medicare Law," ElderLawAnswers, February 6, 2004.) Several Democratic legislators asked the GAO to rule on whether the ad campaign violates restrictions against using taxpayer money for political purposes.

While finding that the campaign is not unlawful, GAO general counsel Anthony Gamboa said, "This is not to say that the content [of the ads and fliers] is totally free of political content." For example, Gamboa said the ads fail to point out that beneficiaries could be required to pay a $30 annual fee for the Medicare drug discount cards, which will be available this summer, or that the $35 monthly premium for the prescription drug benefit is only an estimate and could be higher.

The Democratic lawmakers who requested the investigation said GAO's opinion is based on an "extremely narrow reading" of the law and called on the Department of Health and Human Services to pull the campaign

The administration has already revised parts of the leaflet that the Democrats have criticized, but says the GAO's opinion has vindicated the overall campaign.