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U.S. official responsible for reforming Medicare is leaving post

By David Morgan

WASHINGTON (Reuters) - The Obama administration on Tuesday announced the departure of the top health official responsible for reforming Medicare under President Barack Obama's healthcare reform law.

Jonathan Blum, Medicare director and principal deputy administrator of the U.S. Centers for Medicare and Medicaid Services (CMS), has presided over a range of reform initiatives during a five-year tenure including efforts to move the $635 billion healthcare program for the elderly and disabled away from costly fee-for-service medicine.

His work involved two proposals that drew bipartisan opposition in Congress this year.

During Blum's tenure, Medicare has seen annual per capital cost growth slow to historic lows, though analysts are divided over how much credit can be attributed to reforms ushered in by the law known as Obamacare.

His resignation, announced in an internal memo from CMS Administrator Marilyn Tavenner, follows months of controversy over two separate proposals to scale back Medicare Advantage payments to private health insurers for 2015 and to reform the program's popular Part D prescription drug benefits.

The proposals drew opposition from Democrats and Republicans in Congress and from the private sector. Republicans accused the Democratic administration of cutting Medicare to pay for Obamacare and risking harm to senior citizens, a crucial voting bloc in November's midterm congressional elections.

The administration, which said its aim was to strengthen the $635 billion program and improve options for beneficiaries, ultimately backed down on both fronts. After first proposing a 1.9 percent 2015 cut for Medicare Advantage insurers, it announced this month that reimbursements would rise slightly. The administration also dropped proposed Part D reforms that included fundamental changes to the popular drug benefit program.

In her memo, Tavenner said Blum's accomplishments were "too many to list" including the introduction of competitive bidding for medical supply purchases and care delivery reforms intended to reward doctors and other healthcare providers for quality outcomes and cost savings instead of tests and procedures.

"Under Jon's leadership, the Medicare program has served as one of our primary drivers to shift our healthcare system to reward quality, care improvement, and value," Tavenner said.

She described Blum as Obama's first political appointee to CMS and said he will now pursue "new opportunities". His last day is May 16.

(Reporting by David Morgan; editing by Andrew Hay)

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