Friday, May 4, 2012

Sen. Chuck Grassley and Sen. Herb Kohl, authors of the Physician Payments Sunshine Act, today made the following comments on news that the Centers for Medicare and Medicaid Services (CMS) needs more time to implement the act and will not begin data collection until 2013.  CMS' statement is available here.

Grassley said, "It's disappointing that CMS won't even collect data at all this year.  The process has dragged on long past the statutory deadline for implementation.  Consumers need to know more about the financial relationships between their doctors and drug companies sooner rather than later.   It's important that CMS get this right in every way, including the usefulness and accuracy of the information.  Given all of the extra time, CMS will have no further excuses for not accomplishing these goals."

Kohl said, "While I am disappointed by this delay and the timeline, I do look forward to working with CMS to finalize the rules so that data collection can begin in January 2013."

The senators developed the Physician Payments Sunshine Act, which was signed into law in 2010, after revelations of significant under-reporting of the amount of payments received by certain doctors from drug and device companies.  The new law requires public disclosure of the financial relationships between physicians and the pharmaceutical, medical device and biologics industries. The law required the Department of Health and Human Services (HHS) to establish reporting procedures for applicable manufacturers to submit information, as well as procedures for making that information available to the public, by October 1, 2011. CMS issued the guidance in December after more than a year of pushing for a timely release from Grassley and Kohl.

Grassley and Kohl have written to the acting CMS administrator with questions about implementation, including when CMS will begin data collection.

The text of the Grassley-Kohl April 4 letter to the acting CMS administrator is available here.

The acting CMS administrator's May 3 response is available here.

Closed-End Funds a Good Investment Option

Baby boomers stand to inherit $10 trillion in the next few years and women will get the bulk of it, according to a Cornell University study, because they outlive men an average of seven years.

"Women already control 60 percent of the nation's personal wealth - they outnumber men and they are traditionally the shoppers," says financial expert Scott T. Schultz, author of Scott Schultz's Guide to Closed-End Funds (www.closedendfundguru.com).

"It's sad that, despite the fact that nearly a third make more money than their husbands and they're starting businesses at twice the rate men are, 38 percent of women ages 30 to 55 worry they'll eventually live in poverty because they can't adequately save for retirement," he says.

With the first of the boomers hitting 65 this year, the nation will see an even greater number of retirement-aged women holding the country's purse strings.

"Many will inherit money and property from their parents and/or their husbands, and many will live another 30 to 40 years," Schultz says, citing the Cornell study. "They'll need to invest their money to ensure they have enough to avoid that impoverished retirement they fear, but they - and the nation - have lost confidence in the stock market; April 2011 saw the lowest number of investors since 1999."

What brokers don't tell clients about, he says, is closed-end funds. Schultz, ranked the No. 1 Separate Account Money Manager for three consecutive years by USA Today, says he earned that national honor by relying almost solely on these limited-issue stocks. Because they're available only in finite numbers and because watchful brokers can find them "on sale," they're a better bet as an investment for those who are willing to sit on them awhile.

Why is the American public so in the dark about closed-end funds? Noting his book is the first written on the topic in more than 20 years, Schultz says there are a few reasons:

• Brokers can't generate a lot of commissions from them. Brokers move open-ended funds quickly because they earn a commission with each transaction. It's easy money for them, Schultz says. Closed-end funds require a longer term investment strategy, so brokers who want to get rich quick won't use them.

• They require more effort from the broker, who has to work to find the "sales." One advantage of closed-end funds is that they can sometimes be purchased at a discount, so the investor starts off ahead of open-end investors who are paying full price for stocks, Schultz says. Even if the fund never gets back up to its full value, any increase at all is a gain. But the broker has to be willing to work to find the good investments with good discounts. And then he or she has to be willing to sit on them.

• Closed-end funds are boring! For a lot of brokers, it's just plain fun to trade stocks in products and initiatives with an exciting ring to them, whether it's Facebook or a treasure-hunting ship. These brokers are constantly trading stocks - and generating transaction feeds, lawyer fees and underwriting fees every time - because that's what they like to do. Closed-end funds require thoughtful, sometimes tedious research before buying, and then the patience of a saint as both the broker and the investor wait for the bid price to increase.

About Scott T. Schultz

Scott T. Schultz began his career in 1983 at E.F. Hutton and was ranked the nation's No. 1 Separate Account Money Manager by USA Today for three consecutive years using GIPS verified/audited performance numbers supplied by Morningstar, Inc. Schultz was a GOP nominee for U.S. Congress in 1988, and met with Presidents Ronald Reagan and George H.W. Bush at the White House. He graduated from Michigan State University with a degree in journalism.

by U.S. Senator Chuck Grassley

 

The taxpaying public's confidence in the federal government suffered more setbacks recently with two scandals:  excessive spending by the General Services Administration and allegations of misconduct within the Secret Service.  The actions by employees in these agencies have led to internal and congressional investigations that call into question the culture of the bureaucratic hierarchy.

 

Americans may not be as familiar with the GSA, which was established in 1949 to streamline the administration of the federal government, from purchasing paper clips to managing leases for office space.  In effect, it is an agency that is supposed to help other agencies operate efficiently and should therefore be a model of fiscal rectitude.  The GSA's lower-profile, behind-the-scenes work was elevated to a higher-profile public square when its $822,000 "retreat" in Las Vegas made the GSA the most recent example of excessive, wasteful spending by the federal government.

 

Showing blatant disregard for taxpayers who would foot the bill for its over-the-top conference in 2010, the GSA pulled out all the stops with lavish entertainment (including clowns and a psychic), gifts and luxurious accommodations knowing full well the taxpayers were picking up the tab.  Somehow I don't think the GSA needs to re-hire the mind-reader to figure out how taxpayers feel about paying for 300 federal employees to viva Las Vegas on their dime.

 

Yet another shoe dropped amid reports of alleged delinquency by federal agents on assignment in Colombia.  This time the scandal affected a federal agency that until now has enjoyed longstanding repute with the American public for its code of professional conduct.  The Secret Service has earned a prestigious reputation for its protective services to American presidents beginning after President McKinley's assassination in 1901.

 

Now the esteemed law enforcement agency, whose no-nonsense, clean-cut agents are renowned for wearing tinted sunglasses and corralling rope-lines at presidential events, is suffering a black eye from alleged carousing by a dozen agents soliciting prostitutes while on assignment in Colombia.  By any measure, Secret Service agents who would hire foreign female escorts for nighttime entertainment while on assignment exhibit the judgment skills of a class of nitwits.  The security risks associated with U.S. agents' allowing strangers into their hotel room in a foreign country are obvious.  Let's hope the President is correct when he claimed it was a few knuckleheads exercising poor judgment.

 

If the Secret Service incident is not isolated and instead exposes a broader culture within military, law enforcement and security forces that says this type of behavior is okay, that is a big problem.

 

That's why I'm asking more questions.  I'm glad the Secret Service acted swiftly to fire agents, revoke security clearances by those involved, and issue new rules explicitly prohibiting agents from hosting foreign nationals in their hotel rooms when traveling overseas.  The Homeland Security Department's Inspector General will be independently reviewing the Secret Service's internal inquiry.  An independent and transparent review will help restore credibility to the Secret Service.  As Ranking Member of the Senate Judiciary Committee, I take seriously my constitutional oversight responsibilities.  It would be negligent to sweep this incident under the rug and forget about it. Getting the facts on the table will help determine whether there is a broader cultural problem that needs fixing.

 

A Washington culture of overspending, mismanagement and layers of ineffective leadership within the vast federal government begs for enforceable accountability and transparency.

 

Taxpayers are reminded over and over again about the $15.6 trillion national debt and unrestrained spending that racks up deficits year after year.  Looming shortfalls in the nation's entitlement programs demand more effective stewardship of tax dollars.  And when scandals such as clowns in Vegas and prostitutes in Cartagena keep cropping up, the people's trust is further violated.

 

From many years of oversight work, I'd say Washington's modus operandi is that it's easier to go along to get along.  As an advocate on Capitol Hill for whistleblowers and watchdogs, I work for sunshine laws and reforms that will keep public the people's business and strengthen our system of checks and balances.  My oversight isn't based on the political party of the President.  Over the years, I have been an equal opportunity watchdog.  Leaving no stone unturned is the surest way to root out wrongdoing and hold the government accountable to the people it serves.

 

May 4, 2012

DAVENPORT, Iowa -- May 4, 2012 -- Steve Kuttler only needed to buy one raffle ticket to experience the golf trip of the lifetime at the 2011 Lexus Champions for Charity National Championship at Pebble Beach.

Kuttler had previously only driven past the famed Pebble Beach Golf Resorts along the coast of California.

"That was enough. It wasn't even on my 'Bucket List' of things I wanted to do. I thought it was out of my range,'' said the Davenport Central High School teacher and golf coach. "It wasn't even my dream.''

A lucky draw at the 2011 Genesis Pro-Am Challenge changed all of that.

Kuttler purchased one $50 ticket for the raffle to play in the Lexus Champions For Charity National Championship tournament. The trip was donated by Lujack Lexus of Quad Cities, a tournament sponsor of the Genesis Pro-Am Challenge. Kuttler didn't think much about winning; not with just one ticket.

"Our daughter, Anne, is a nursing student at Luther College and she was one of the recipients of a $10,000 grant through the Genesis nursing scholarship program,'' Steve explained. "Everyone had been so kind to our daughter, and it was fun having her speak at the reception.

"We thought that we should spend $50 on a ticket for the raffle and we had the $50 that day.''

The one raffle ticket the Kuttlers had purchased was drawn as the winner. Steve and his son, Ben, a former high school golfer at Davenport West High School, played the Pebble Beach courses in the Lexus event last December.

Lujack Lexus of Quad Cities is again sponsoring the raffle to win the all-expenses paid 54-hole tournament. Only 300 tickets will be sold at $50 each or 3 tickets for $100 for the chance at the golf package valued at more than $8,000.

The ticket drawing for the package will be held on Aug. 20 at the annual Genesis Pro-Am Challenge. The Pro-Am will be held on three courses - Crow Valley Golf Club, Oakwood Country Club and Short Hills Country Club. Lujack Lexus of Quad Cities and Quad City Bank & Trust are tournament sponsors.

There will be a 11:30 a.m. shotgun start at each course and a $250 entry fee to play, which includes lunch, course refreshments, cart and greens fees, an entry gift and heavy hors d'oeuvres during the Awards Reception at each course. There will be a golf professional playing in each foursome.

Proceeds from the raffle and tournament help provide nursing scholarships for future and current Genesis nurses. For information, or to purchase tickets for the raffle, call (563) 421-6861.

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