Friday, November 11, 2005

Arlington, Virginia

Mr. Morales: Good morning, and welcome to The Business of Government Hour. I'm Albert Morales, your host, and managing partner of The IBM Center for The Business of Government. We created The Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about The Center by visiting us on the web at www.businessofgovernment.org.

Mr. Dyer: Good morning.

Mr. Morales: And joining us in our conversation, also from IBM, is Lois Romeo.

Mr. Dyer: Sure. First of all, the Centers for Medicare and Medicaid Services, let met give you the acronym, we refer to it as CMS. I think that's how most people know us, and, fundamentally, it runs two programs. The Medicare program, which is for our elderly, which if people pay into retirement, their Social Security, they also pay towards that tax. And then they're covered for their hospital care. And then if they want to pay the co-payment for their outpatient services and doctor offices. The other half of it is Medicaid, which is the program for the low-income of this country. It is run predominantly through the states. The federal government matches with the states. And the states actually day-to-day worry about the running of it, the federal government exercises oversight of it.

Both programs, the total, spend about a half a trillion dollars a year. They're each about 250 billion rounded, plus or minus here or there. And as you can see, they take care of the elderly population, the low-income, low-income being mostly women, children, nursing home care, long-term care for the elderly low-income, and then, of course, Medicare. But besides Medicare, it also covers people with kidney dialysis and other illnesses. It has special features for that.

Mr. Morales: John, you've had a very long career in public service, and I understand you've also served our nation at OMB. How did this experience prepare you for the role of Chief Operating Officer?

Mr. Dyer: OMB was to me the best training ground I could have for it. They teach you very quickly there how to do hard-headed analysis, pull together the data, move to what the options are, and then lay out how you would actually implement any implications of each option. You're exposed very early to dealing with the top-level executives, and you deal with very broad policy cross-cutting issues. So to me, it was just ideally suited.

I got to, in my career there, move from starting on the health side, working on drug abuse programs, to move over to what they call the general government side there, where I actually worked on NOAA -- National Oceanic and Atmospheric -- programs, environmental programs, satellite programs. And then when I went on to be the branch chief of the commerce branch, I got into small business administration, loan programs. Department of Commerce has just about one of every kind of program. And in addition to that, I was fortunate when I started there, the policy officer in the unit I was in was Paul O'Neill, who went on to be Secretary of Treasury. So you get a chance to be with the best and brightest and learn how the right way is to do it, good examples.

Ms. Romeo: John, you have quite a few functions reporting into you. Could you give us a description a little bit about the functions reporting to your office and tell us a little bit about them?

Mr. Dyer: Sure. All of what I call the direct support functions report in directly to me. This is the systems, the human resources, operations management, the regional offices, the finance, and program integrity. Those are all direct-report. We also have other centers that are the programmatic, and it's those centers, the operational aspect of those centers reports in to me. Each one of those groups, whether its Medicaid or dealing with the fee-for-service world or the managed care world, they have a policy side and operational side, and I work with the head of that group and I have oversight over them in terms of their operational activities.

So I'm really focused on how do we manage with a workforce of about 4,800, roughly 63 contractors. Most of our work is done through contractors, so I'm working with each center director on that aspect of the operation. Or with the computers: we spend about a billion dollars in computer services, depending on what-not.

The administrator relies on me to be the person that integrates across the agency. My job is to make sure everything is getting done, what he wants done, the Secretary and the President want done, is being carried out from an implementation operational. I also worry about the processes that he has put in place to get the policy, to make decisions on how we're going to operationalize things. My job is to run it through. So even a policy that's starting, I'm worrying about is the process in place to get a good outcome from that policy, to get to the right policy, the right analysis. And then once the policy's made, we move into program design. Then I spend my time making sure it gets done. That's fundamentally my role.

Mr. Morales: Many of our listeners may not typically associate the Chief Operating Officer role with something that you would normally find within a federal agency. Can you tell us about a typical day in your shoes?

Mr. Dyer: Yeah. First of all, you're right, there aren't very many Chief Operating Officers that are kind of set up the way I am. As I understand it in this administration, normally the Deputy Secretary serves as the number two person and the Chief Operating Officer of the Department. In our case, we have me set aside, because when you look at all the things that our administrator, deputy administrator, and I have to deal with in a typical day, it's impossible for two people to do it all.

Mark McClellan, the administrator, is dealing with the outside advocacy groups, the interest groups, the Hill, the White House, the Secretary. He's just -- his schedule is unbelievable and he's trying to keep in touch. The Deputy is dealing usually with the Department and the Secretary's issues with the industry. So my job is really to worry about the day-to-day running of the organization.

So let me give you my typical day. Last Friday, I started out in the morning with the staff meeting with the administrator. He sits down with all his key folks. I was in Baltimore that day, he was in Washington; we're hooked up by a teleconference. We went over the various agenda items with the Deputy and laid out what was hot that day.

From there, I moved into meetings. I met, for instance, with the head of systems for us, and went over where we stood with all the latest systems we had to start bringing together for the Prescription Drug Program, which ones were ahead of schedule, which were behind, what were on target, went over that in great detail.

From there, I met with the person who was actually interested in working for us, a possible executive. So I interviewed that individual. From there, I went and had lunch with somebody who had a concern about our procurement operation, had they been treated rightly or not. And so, you know, I was trying to get some insight. And it was an individual who had worked in the agency before, so it was a good chance for me to kind of get his insights.

The afternoon, I met with all our managers to talk about how we're going to proceed with talent pooling or succession planning, what our plan is, what our game plan is. We had a session with the head of the group that runs the Medicaid program for us, went over what their issues are.

So you can see, I move across a wide spectrum of activities during a daily basis. I find it very interesting. I enjoy it.

Mr. Morales: That's certainly a full day.

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with CMS Chief Operating Officer John Dyer. Also joining us in our conversation is Lois Romeo.

Mr. Dyer: Okay. The reorganization was started a little bit before my time. I think it was 2002. And it was Tom Scully and Secretary Tommy Thompson who came up with the idea. I think it was several factors as to why they changed the name.

One, I think that the old name, HCFA as the acronym was, Health Care Financing Administration, had negative connotations. I think the sense was that the agency had not been as responsive as people would like. But more importantly, the Secretary and the administrator, from what I, again, have been told, saw that the mission and what the agency was doing was changing, that it was becoming more of a service organization, not just simply of financing. It had been viewed before that it just paid for Medicaid in the states, paid for the fees of the services of the doctors for the various Medicare beneficiaries. But now it was moving into getting into preventive services. It was mixing up the kind of programs it would finance and pay for and reimburse, moving from fee-for-service to managed care. So the thinking was to change the image and the title.

And my memory is when I at least read the accounts of going through and talked to friends there, the Secretary asked for ideas for the name. And at the end, they picked the Centers for Medicare and Medicaid Services, picking up on the notion of services, picking up on the notion that Medicare and Medicaid were the two major aspects of what the agency was known for and what it was accountable for.

Now, as we look at it with Dr. McClellan, we even see it as a public health organization, because when the Medicare Modernization Act was passed a couple of years ago, it expanded the role and encouraged the agency to go into preventive care services, to pay for them, such as immunization shots, physicals. When I was there 15 years ago for a couple of years, it was very simply if you had a medical problem, you got surgery, it paid for it and that was it. Now it covered a wide spectrum, tried to move more into the prevention. And as we have gotten into now bringing up a major prescription drug program, that really helps the person take care of themselves. They don't have to go to the extreme of surgery if medication works or other choices work. So we see ourselves as more the whole approach to it, so the name carries that connotation with it.

Mr. Morales: You used the term "service," and since reorganizing, we know that CMS has taken steps to improve customers' understanding of Medicaid and Medicare. How did CMS decide to focus on customer satisfaction, and what steps did CMS specifically take?

Mr. Dyer: Well, you know, at the end of the day, service in the health world is either that you got well from the medical procedures and that you're happy with what it was, the outcome. So ultimately, you really need to think about what people's satisfaction is, particularly as you're moving towards health maintenance organizations, where there's a lot more of are they really giving an overall good package and a good approach to people as people begin to shift in that direction. So that was the stuff.

The other thing is, you've got to realize that we're serving in Medicare 42 million people and in Medicaid a little over 40. And it's very important that they understand and have a good appreciation of what we cover, how it works, that it's easy for them to understand. These are elderly people; some things can be a little confusing. I get confused at 58 with some of the things I have to understand. So the whole idea was how to make sure that our beneficiaries, people who've actually paid into Medicare, all their life have put aside money to pay for it, or Medicaid, where they tend to be at the low-income spectrum and more, I guess, a need, that how do we make sure that they really can understand what is available to them, how the program works? And now that we have, as I said, different ways, different things we'll finance, whether it's fee-for-service, managed care, prescription drug, that they understand what the implications are, what it means to them in terms of premiums, paying out of pocket. So we have really built a lot more of an outreach benefit approach.

We have a center called Beneficiary Choice, and it has -- a large part of it is to be service-oriented, in contact with the beneficiaries. The programs range from -- we run an 800 number nationally, which has traffic of over 40 million calls a year, you know; it's going to reach over 50 this year. You have lots of information we put out now in English and Spanish, where we've tried to simplify it, make it very clear. We have websites that we've brought up, www.medicare.gov, where you can go in and ask basic questions of what's going on.

We work with the providers to give them information that they can pass on with the doctor or nurse. When we were doing the drug card, we had a lot of information we provided to pharmacies, because we knew that the beneficiaries people would be coming in there and that would be a good place to contact them.

So the emphasis is, you know, this is a program people have a right to and they've earned. And we're trying to figure out how best to make it easier for them to understand how to operate what their choices are.

Ms. Romeo: John, as you look at your key operational goals, can you help our listeners understand what some of those are for the year?

Mr. Dyer: Yeah, this past year, the key one has been to bring up the Medicare Modernization Act that passed a couple years ago. The biggest piece of it is what I mentioned earlier, is the Prescription Drug Program. And it provides -- has us setting up plans across the country. We refer to them as PDPs, prescription drug plans, are under the managed care, or MA as we use the acronym. You can take your HMO, health maintenance organization, program, and add more prescription drug features to it or mix it up.

So the Act calls for us to have it in place and up and running November 15th. And on November 15th, the public can begin to sign up with the plans. And we have, for the past year, been working with the industry, going out explaining what it is, laying out the rules of how it'll work. We completed the contracts and the bidding and all that a month or so ago. And so people who want to get into a prescription drug plan are able to pick and choose whichever plan they want. There are multiple plans out there. And we've also set up websites to help you narrow down to if you want to pay a certain premium range or this or that, the pricing is very good. But that is what we've been spending our time putting in.

So one has been to lay out the policies and how it will work. The statute left a lot of the decision-making up through the regulatory process, of how to design the plans, what to require, what the specs would be, where to put the subsidies, just a lot of policy issues that we've spent the last year and a half working through.

The second thing is that you have to bring up huge systems to handle this, and that's where I've been spending quite a bit of time, which is that it involved 15 systems. And everything from how does the plan know that the person is eligible for Medicare who's applying to the plan -- the process for enrolling the person, for us to know who the plan is, the processes to pay the plan, the business processes we've worked out with Social Security to identify low-income recipients. And, also, with Social Security, if someone wants the premium for the prescription plan taken out of their Social Security check, they can do that. So we've worked that through the systems with Social Security. So all of that has been put into place. Plus then, the follow-on of appeals, the tracking through.

We also put together a campaign. I don't know if you've been watching the campaign unfold, but about a half a year ago, we started to say it's coming. The President joined us in announcing this looks good. Then we began to start to explain what the plans would look like, what you needed to think about.

There are roughly five different groups of people out there that we think would break the plans in. There are the low-income eligible. The Act requires subsidies for particular people that their annual income is below a certain amount, or their resource levels.

It, secondly, takes care of what we call the auto-enrolls. These are folks that were being covered before for their prescription drugs by Medicaid, which we were paying Medicaid for. Now they've moved directly over to our plans.

They have what I call euphemistically the regular. That's the vast majority of the Medicare retirees. There's a smaller group of those who are already in managed care plans with us that can expand or adjust their plan.

And then the law also has a feature for if you come into the private sector and your business that you're working with gave you health coverage, prescription coverage, after you retired, such as a General Motors or some of the bigger companies tend to be there, it provides a subsidy. If that company brings its prescription drug feature of its plan in sync with our basic requirements, they get an 18 percent subsidy, which goes towards paying for their costs.

So it had a lot of features, and we had to start to lay out how do you explain to people this. We put it in the Medicare handbook and we've sort of been laying that out. We've been now moving to say, okay, we have these websites you can go to or you can call our 800 number. So a major effort to get information out so people would understand how it works, what the advantages are, what the pricing has come out to be. So is it convenient to them? Does it meet their cost requirements? Is it a good deal for them?

Mr. Morales: John, we've heard a lot about the contributions of various public and private enterprises in the wake of the hurricane disasters. How did CMS specifically contribute to the Hurricane Katrina disaster relief?

Mr. Dyer: In lots of ways. First of all, remember, we're a financing organization. We don't have doctors and nurses that you can send out, necessarily. We have some that did go. But generally, what we did is we looked at a couple of things.

On the Medicare front, the Secretary and the administrator moved very quickly to issue waivers. We have a lot of requirements that you have to have procedures done by certain doctors and groups that have gone through, you know, various certifications and protocols. We waived a lot, because getting medical care, not every hospital, not every doctor in the situation they were under could deliver it. So we moved very fast to make sure that we could finance and reimburse quickly for whatever was out there.

On the Medicaid front, we worked with the states, because you had a lot of folks crossing state lines, being moved around. This was a hurricane that -- one of the first I can really remember where it went largely outside each state's jurisdiction of impact. So we, early on, were working with the states, said, well, how do you pay for someone moving -- Medicaid moving from one state to the other. What were the implications? We've been working with the states and the governors and the Congress to work through for the future payment of Medicaid, what will 100 percent federal, what will be, you know, be a state match. So everything we could do to be responsive to make sure that the money was going to follow whatever the services were, and that people moving from one jurisdiction or out of one style of paid program would be picked up elsewhere, we did as fast as we could.

The second thing that's been done by CMS is that the President asked the Secretary to take the lead for helping Louisiana, Mississippi, and Alabama bring back up to the degree whatever medical capacity had been; infrastructure had been lost. It made sense to have us involved because we're one of the big payers. We pay for about a third of the care in this country. So my administrator, he tasked the Deputy, our Deputy, Leslie Norwalk, to be working on this multiple group that has people from the state, locals, and out of the federal establishment to start to think through, well, how do you begin to bring back up the health care system? Obviously our input being to support where the states and locals want to go. So I haven't seen too much of our deputy administrator because she's been spending a lot of time working on the task forces.

Mark McClellan, of course, went and made several visits with the Secretary to the region, so that he could have his ear to the ground, see what could be done, and tried to basically respond on what they're hearing and what the needs and requirements have; been working with the Congress, with the Office of Management and Budget, and everybody to move forward and make sure, you know, things get covered and funding gets taken care of. So overall, it's been quite an effort.

The other thing we learned was how to prepare to be even better and more responsive to upcoming hurricanes. So as Wilma came and others have been arriving, we have been integrated earlier on and have started working with the medical groups, the hospital groups, and sitting down with them and saying, okay, if the storm's going to move this way, how are you going to move the patients? Where is the best way to move them? How do we move the financing to go with them? How do we track-through the continuity of their care? And we've tried to be even more proactive up front. So it's been a good learning experience and I think a good success story. And at the end, I think people will be pleased as to where Secretary Leavitt and others go with those communities to have first-class medical systems reestablished there.

Mr. Morales: That's great.

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with CMS Chief Operating Officer John Dyer. Also joining us in our conversation is Lois Romeo.

Mr. Dyer: Well, as I said, annually we make a half a trillion dollars in payments. I think that's a pretty big number. We're doing a lot of things across the board.

One, obviously in the systems, we've been working on how to improve them. We've been bringing up a big project with IBM called HIGLAS, which is that we will automate our chart of accounts and ledger and all of that. So we'll have one integrated system, which is now the financial requirements. This year, we were very pleased to move it in out of the developmental into the operational phase, and we've been bringing it up with some of our contractors, some of our payment sites. We're going to be developing the administrative piece of it later this year. So it is moving, and we've gotten basically a green on that because we have taken it out of developmental into operational. It'll take us a few years to obviously bring it up nationwide because we're going to do it in steps as we roll it out, but it's working. It's already saving us money. We're finding that it's catching transactions that shouldn't have been made and we've been able to stop them and save us, I guess, about $700 million. It's a pretty big amount of money in just a few months of working. So we're very pleased with that.

The other things we do is we run a large program integrity program, where we go out and we review the claims that are being paid or the bills that are coming into us from very many different aspects. For the last couple of years, we've been putting together a methodology to test our payment accuracy for Medicare for fee-for-service. This is for the hospitals and physicians predominantly. And as we drove this year to set a goal, our error rates were running around 10 percent. And this year, we were able to cut it in half, roughly.

And now, how did we do that? Well, a couple things. Some simple things, like we just gave people a little more time to get the information in. Other things, though, is we had contractors and we hired people to follow up to make sure that the information was fully filled out, because a lot of the errors were just incomplete information. So we've been working that and we've, I think, made a tremendous success to have a basically 100 percent reduction in a year's time. So we have a good tool to benchmark where we're going and we've been measuring against it.

On the other program integrity side of Medicare, we obviously have various contracts with different groups that look at the claim to see if it was done accurately, look for patterns of fraud, and those have been very effective. We've had large cases, like the Tenet case, where we've saved millions of dollars, where a hospital was just basically falsifying its records. We picked up patterns by looking at it and eventually tracked them down.

The Inspector General, law enforcement across state, federal, the Attorney General's office work closely with us. They use the data from an enforcement side. We use it from a cross-match to see things. We recently were able to spot a pattern of billing for us for HIV drugs in the Southeast. And that allowed us to jump very quickly in and see that people were not doing the correct thing there. So we have a very large system that, over the years, has been expanding.

We also now are going to have it grow to go with the new prescription drug program, Part D, as it's called. We've signed agreements with various program integrity plans so they can watch what's happening in the drug area. The drug area, you got to be watching everything from that they're falsifying eligibility to they're not providing the quality of drugs that they say that they have to give us under our rules, to falsifying the usage of drugs by the beneficiaries or the premium payments, a lot of things that can be taken advantage of. And so our idea is let's get in early, let's get started on it quickly, let's head it off. So we have a large effort.

We also brought up, over a year ago, satellite offices in Los Angeles and Miami, because we know we have higher traffic in some of those areas. So constantly watching for what is the trends out there, what's being falsified, where's new fraud being introduced, see if we can get on top of it, putting measures.

On the Medicaid side, we're coming up with a new measure that we're going to work with the states where we'll go in and pull a sample to see how accurate payments are being made, what's going on, so it'll give us a measure there that we want to come up with, so we can be looking at that. We pay the states, we give them funding for them to run programs for anti-fraud and other activities, and we work closely with them, as does the law enforcement, so we're very active in that arena. And over the last few years, it's been increasing. And the kinds of return and payoffs we've been getting have been very, very good.

Congress, if I remember rightly, about five years ago, actually encouraged us and set up a program and gave special funding. So it's been an all-around effort between the administration and the congressional branch.

Ms. Romeo: The CMS website lists some of your goals and relationships, and improving responsiveness, in particular, is one of your goals. Can you explain how our listeners would view your work around relationship-building?

Mr. Dyer: This is something that I think came to with the change in CMS and the leadership in the last few years. Historically, again, I keep going back historically because I worked in CMS between '84 and '88, and all the years when I was at Social Security from '88 to 1999, I, of course, interacted with all the administrators and the deputies in the key places at CMS, or HCFA, as we called it in those days. So I've always felt very close and I've been working closely with them.

I think that if you look at CMS from the old times, there used to be a time when it would issue regulations and just put them out there. It would take law and implement it without really that much consultation with who was going to be affected. The CMS today, we don't do anything unless we really have talked to all the players, from the Hill folks who design the legislation to the beneficiaries to the advocates. Anything we do, we're very up-front. To the degree we can provide information, share what our thinking is, what we're looking at, get data and information from outside groups that can help us make our determinations, get to the regs, so that when we issue a final regulation or a guideline or a policy or procedure, it should not come across as a surprise.

The other thing that recent administrators and secretaries have been very consistent on from CMS is that when we do go out and start to issue new things, that we really make the information available. We sit down and explain it to the press. We go over it carefully, that they may not like it, but there's nothing hidden from them as to what's going on.

The same thing with the advocate groups. For instance, the administrator announced the rollout of some new websites and, you know, he has a press release. We show them the screens that you can use. We walk through examples. The idea is to be very visible, open. This is, you know, going to impact on them, on the industry, and we want to be sure that everybody's had a chance to weigh-in, hear their views. We try to weigh them as best we can and then proceed. So very much of open problem. As I joke, in my day, we would take a regulation in the dark of night, throw it over the transom. Now, by the time we get the regulation out, if anybody's surprised as to what they read, it's pretty rare.

Mr. Morales: With the complexities of your mission and on this topic of public trust, how is CMS implementing the Sarbanes-Oxley, or A-123, requirements?

Mr. Dyer: This past year, we've been early with our audit reports and I'm just coming off of doing the audit report. And we started -- just to take this one, we started working a year ago on this. You know, the administrator and I, after we got last year's report, said we're going to do better. And so we sat down and we put together a group that I chair which pulls in the top executives of all our components, and said, okay, these are the material weaknesses that we have, these are the areas where's there indication that we're not fully in compliance. We're going to get these fixed. So we laid out plans for everything, both on the Medicare and the Medicaid side, and we started to work them through.

I and others met with the outside groups, our contractors, that do a lot of the work and said we no longer are going to have a material weakness on the systems side of the contractor world. On HIGLAS, if we didn't move from developmental to operational, we knew the auditors weren't going to be able to say to us, look, you're moving forward, you can continue to be in compliance. And so we went through the drill.

As the year went on, we saw we had some issues with managed care, and we started working earlier with the auditors to start to address and look at that. And so we got through this past year with only one material weakness, a new one, which we'll have fixed by the end of next year, if I have my say, but we were able to really make strides. And we've invested the effort and the time, and the administrator and I are pleased with where we've gone. So it's a matter of you've got to -- it's not hard. To live with that act is easy. You've got to sort of look at what's before you and you've got to get serious about solving it. You can't do it all in one year. Some things take a little more.

The other piece that we're working on now as we move into next year, it'll all be do you have adequate internal controls becomes the next question. So I've already been working with the Assistant Secretary for Management and Budget at our place for finance, Charlie Johnson. And we've begun to work across the Department with them and our part to start to say, okay, how do we put up good -- make sure our internal controls are adequate. And we've begun to tackle that. We have a contractor to help us lay out the methodology and approach. And using the same risk audit groups of our key execs, we'll run the same drill of going, okay, let's go systematically through everything, starting with the higher risk areas and working our way across. I did it at Social Security. It's doable and it's just a matter of, again, rolling up your sleeves and getting commitment.

We involve in the group. We'll have the IG present, too. We keep the General Accounting Office informed of what we're doing. So there are no secrets. I'm happy to share it with most people.

Mr. Morales: Great.

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with John Dyer, Chief Operating Officer of the Centers for Medicare and Medicaid Services. Also joining us in our conversation is Lois Romeo.

Mr. Dyer: I think that we're going to be able to handle it okay. We're finding that a lot of people are very interested in coming and working for us. And we are at the center now of health care policy. We purchase about a third of the care in this country. In the next decade, we'll be about half of it as the Baby Boomers move into Medicare days. So we are not that concerned. We've been able to compete pretty well at the entry level and the mid-level. Get to the higher end, obviously bringing people like me, in are hard to find that'll take the kind of reduction I took. But we are pretty confident.

We also, in a sense, lucked out that we got all this work with the new Medicare Modernization Act. But we were given the authority and we were able to bring in 400 people in the last couple of years, so we have been able to infuse the organization with a lot of diversity.

To me, as long as we're able to make the work interesting, continue to be a leader in our area, people are going to want to come work with us, because they're going to learn everything. And as I tell the new recruits coming in, if you're not happy doing this job, we have everything, every type of profession you can imagine. We'll give you the training. We'll bring you along. We'll develop you. And you can come into our place starting out as a programmer in a particular kind of software and you could move into 12 other types of systems issues, whether it's data storage or formularies, small quick programs, major ones, major systems. If you get into policy, you can move from hospital reimbursement policy to managed care. If you're a nurse and you want to get into pharmacy, you can move over to our choice side and work on prescription drugs. So there's just so many different challenges and interests.

And, you know, when I was -- for instance, I keep drawing back, when I was last at CMS, or HCFA, we were really a small part. We were still getting our piece of the action, you might say. Now we are the key player and we're going to be even more of a key player, so I think we have a lot of attraction to draw. I mean, we're sort of like the Federal Reserve of the federal government or the OMB for health care. We're in a good department. The Department gives us a lot of support, and so you can move across the Department. So to me, there's just a lot of opportunity and chance.

Keeping people at the higher end is a little tougher, but you find folks like what we do. I mean, they know at the end of the day they're looking out for the welfare of a larger and larger part of our population, and it's rewarding. And tough work, but rewarding.

Ms. Romeo: John, over the next 10 to 25 years, what types of patient population issues will CMS face?

Mr. Dyer: You know, if you look at the elderly, you start to see more and more people with chronic care, heart conditions, diabetes. So, you know, we see that to continue to be an area, so we don't see that much change in the difference of kinds of illnesses you get, cancer and the long-term.

What we see, though, is obviously the elderly population will be getting much bigger. The type of medical treatments will change dramatically as they go into being able to look at your DNA and treat you based on your DNA or the stem cell research, wherever it takes us, and all these things that are going on, which means that the medical professional of the future will probably have so many more -- a wider arsenal of treatment available to them, that a challenge for an agency like us will be how do you keep up with what's effective. What do you pay for, don't you? How do you work with the doctors to get it to less cost? When you look at the actuarial estimates of projected costs, one of the big factors is the introduction of new technology. As it comes on board, it tends to be more expensive. So how do we manage that? And these are technologies that are wonderful. People are going to live longer, better, less pain. It's going to be great. But how you manage that, how you pay for it, how do you make sure it's distributed equally, all these kinds of questions will be what people that follow me will be wrestling with.

Mr. Morales: John, what advice can you give to a person who's interested in a career in public service? You've certainly had a phenomenal career back in the '80s with OMB and Social Security, HCFA, and now back with CMS. What advice can you give to somebody who's thinking about starting in public service?

Mr. Dyer: Yeah, I've got to say that for me I've been blessed. I've had the most rewarding career in the federal government that I can think of most people. To be able to start out as a GS 9 in the Office of Economic Opportunity, just about six months before President Nixon abolished it, and wake up 25 years later as the Deputy Commissioner in Social Security, a career person in a political position, is pretty phenomenal. I was -- I'll be honest, I was lucky. At each turn when I was getting ready to make a move, something would come along, much to my amazement, I hadn't expected it, and I would take the chance.

I'd say for people that are starting in government, in my case, it's helpful if you've had some training in public policy or a master's in business. I found that extremely useful to be able to analyze and look at issues. My degree was in public health from Michigan, in the School of in those days was called Planning, but it was mostly economics and public policy; got exposed there to some good people, ideas. I did an internship with actually HEW in those days, HHS now, and that gave me a chance to see what it looked like. So I would encourage that, too, you know, go work a little bit, but try out -- you know, pick up a degree that would help you in a particular area. If you're a doctor, that's fine, they'll take you on a minute's notice.

And from there, as you look at where you want to go work in the government, it's important that you pick jobs that will allow you to move across the organization, not just get buried in a particular part, unless of course, you know you want finance or you know you want this or that. Try to go in with the attitude that you're going to move around. My rule was every three to four years, I'd change jobs. Sometimes, you know, I ended up staying at OMB 11 years, but while I was there, I had three different jobs. Same thing at Social Security. I took a step that the price to get to the new area was I had to continue doing a bit of what my expertise was, but I began to move to other things.

The government is doing whatever it can to recruit people. Sometimes the process takes a little longer, but it's getting streamlined pretty fast now. We've been able to hire people in 30 to 90 days, so it's picking up.

So my advice is, you know, look carefully at what agency. Try to get into the management intern programs, the scholar programs, because that gives you a chance to see what's around the agency, what are your choices. When given a chance to go take an assignment, take it. Get out to the regions.

The last thing that I found extremely helpful with me is I think you have to have a discipline that you know. You've got to be versed in something. If you look at my pattern, I was versed in budget and finance. Anywhere I've gone, anytime as an executive I confront an issue, it usually has some kind of a budget and finance issue. And I really know that part of that world, so I'm very comfortable. It gives me a framework to analyze issues, as does the economic training I've had. So that you want to have some kind of discipline that you're able to -- and I always advise this to people who haven't gotten their college degree that are in government or want to work towards a master's: Pick something that gives you a framework. A law degree, that gives you a way to think about issues. Systems gives you another way to go in. But then once you get there, unless you really know you want to be in that particular niche, look about how you can move around, try things, and I think you'll find that the opportunity will come. If you know your stuff, you're open to change, it's going to happen, because the government is moving so fast, changing so fast now, it's an exciting place to me.

Mr. Morales: Well, John, that's great advice. We've reached the end of our time and that'll have to be our last question. First, I want to thank you for fitting us into your busy schedule today. Second, Lois and I would like to thank you for your dedicated service to the public and our country in the various roles that you've held before your retirement in 2000, as well as your current role in the Centers for Medicare and Medicaid.

Mr. Dyer: First of all, I want to thank the country for giving me the chance to do these jobs. When I was in the private sector for the last four years, and I'll be going back in a couple of years, I really enjoyed it and learned a lot. But when you go to work at the start of the day, it didn't quite feel the same to be figuring out how you were going to increase sales versus my previous role as how you were going to make life a little better for millions of people.

The second thing I do want to pass on to everybody is that, I think as everybody should be aware of, we have now brought up the Prescription Drug Program. From what we can tell, it's a good deal. The premiums are much lower than we thought they would be. We've got some pretty good deals, a wide range of choices as to what they'll cover and not cover. People can get a lot of medical care for a lot less, depending if they want to go with a managed plan. It's worth looking at. There's a lot of choice out there.

We've put a website out and we have the 800 number. The website is www.medicare.gov. The 800 number is 1-800-MEDICARE. You got the Medicare handbook in the mail. If you didn't, your parents, aunt, uncle got it. It's a good reference point. So it's something that you really need to look into for your parents, or your parents need to talk to you or whoever's out there listening.

And we do also want to thank a lot of other federal agencies who have working with us on this. The Food and Nutrition Service in Agriculture works on this. The rest of the Department has been out talking about it with us, Social Security, just -- state/local governments. We've had just tremendous help, and I want to thank all those other agencies, too.

Mr. Morales: Great, John.