WASHINGTON, July 22 — The agency that oversees health coverage for tens of millions of Americans approaches new treatments with a caution born of decades of quality oversight. That temperament, evident in recent coverage decisions on GLP-1 drugs for weight loss, is baked into the organizational DNA of the Centers for Medicare & Medicaid Services — a sprawling federal apparatus headquartered in Woodlawn, Maryland, with over 6,000 employees. CMS was not always called CMS.
It began as the Health Care Financing Administration (HCFA) and was renamed on July 1, 2001. Its roots go back further: to the Social Security Amendments signed by President Lyndon B.
Johnson on July 30, 1965, which created both Medicare and Medicaid. At launch, the program covered 19 million Americans, and the first Medicare director was Arthur E. Hess, a deputy commissioner of the Social Security Administration.
The agency’s cautious approach to coverage — the detail that matters when evaluating new drugs or devices — is linked directly to its regulatory responsibilities. Under the hood, CMS enforces administrative simplification under HIPAA, inspects every nursing home in the United States through a survey and certification process, maintains the 5-Star Quality Rating System for nursing homes, and oversees clinical laboratory quality under the Clinical Laboratory Improvement Amendments.
It also runs HealthCare.gov.
Under the Hood: Six Centers
The agency is organized around six centers: the Center for Medicare (CM), the Center for Medicaid and CHIP Services (CMCS), the Center for Medicare and Medicaid Innovation (CMMI), the Center for Consumer Information and Insurance Oversight (CCIIO), the Center for Program Integrity (CPI), and the Center for Clinical Standards and Quality (CCSQ). That structure reflects the breadth of its mandate — from benefits administration to fraud prevention to quality measurement. As ever, the technical reality is that CMS operates as both a payer and a regulator.
It administers the Medicare program and partners with states on Medicaid and the Children’s Health Insurance Program (CHIP). About 4,000 of its employees work at the Woodlawn headquarters; the rest are in the Hubert H.
Humphrey Building in Washington, D.C., plus ten regional offices and field offices. The agency’s administrator is appointed by the president and confirmed by the Senate. Chiquita Brooks-LaSure was sworn in on May 27, 2021.
Her tenure has included navigating coverage debates around expensive new therapies and the agency’s rigorous clinical standards. What to watch next: the ongoing tension between innovation in weight-loss drugs and CMS’s statutory mandate for program integrity and evidence-based coverage.
The agency’s history suggests change will come slowly, if at all — and always with a detailed rationale. Consult your doctor for medical advice.
