As part of its philosophical dedication to saving tax dollars and encouraging private enterprise, the Reagan Administration last year decided to give a professional management firm the job of running a major government conference in Los Angeles on the future of Medicare.
But things have not worked out well for the conference, scheduled for next Wednesday through Friday: Costs of $8 a person for coffee breaks and $66 for a filet mignon dinner are "extravagant," the inspector general of the Department of Health and Human Services says in a report obtained by The Times.
Indeed, the federal government will spend nearly $200,000 in connection with the meeting, including a fee to the private manager, mailing costs, staff salaries and travel expenses. Fewer than 600 persons have registered--far short of the 2,000 that had been expected to attend--and health consumer groups have roundly criticized the $600 registration fee.
Expects a Loss
And in the crowning irony, the private businessman who is running the meeting says he expects to lose money.
"I'll have to take a hard look at the next government contract that comes along," said David Talbott, general manager of Promotional Planning Inc. of Langhorne, Pa.
"If there's excess profits, everybody complains," said Talbott, who notes that he will not break even unless 1,100 persons register for the meeting. "But look at the other side of the coin--you won't see a report from the inspector general saying the company gets the short end of the stick. You won't hear a peep about that."
He defended the cost of eating at the Westin Bonaventure Hotel, site of the meeting co-sponsored by the federal Health Care Financing Administration and the California Health and Welfare Agency.
"We tried to give them more than the standard rubber chicken dinner," he said.
Six Coffee Breaks
The fare at the $8-per-person coffee break--there will be six breaks during the three-day meeting--includes whole fresh fruit, yogurt, pastry, hot chocolate, coffee and tea. The dinner, for which the hotel is charging $66 a person, includes a shrimp cocktail, salad, filet mignon and dessert.
Conference participants are being charged $475 for advance registration or $600 at the door--a fee that covers attendance at the meeting, literature and meals but not hotel rooms.
Consumer groups in Los Angeles had expressed concern about the admission charge for the meeting, which will bring together health professionals and planners to consider the problems of Medicare, the government health program for those over 65, and Medicaid, the system of health care for the poor, known in California as Medi-Cal.
When criticism was voiced about the size of the fee, a special cut-rate charge of $50 was established for the elderly, students and the handicapped, according to the report by Inspector General Richard P. Kusserow. He opened an investigation after a request by U.S. Rep. Henry A. Waxman (D-Los Angeles).
The special $50 fee covers attendance only, excluding meals or coffee breaks.
"I realize there was criticism (about the fee), but I don't know the impact of that on attendance," said Leonard Gizinski, a spokesman for the Health Care Financing Administration, which runs the Medicare program.
A Medicare conference in New Jersey in December, 1983, also organized by a private contractor, had a $300 fee and drew about 1,000 participants, he said.
The government has given private businesses the job of running major health conferences "because we feel it's more economical," Gizinski said. "The contractor is doing this at risk."
Promotional Planning will receive an $80,000 fee from the federal government and will have estimated expenses of $885,634, according to the inspector general's report. The liability rests with Promotional Planning: If the conference costs more than the firm collects in registration fees, the company will suffer the loss. The federal government has no further obligation for financing the event.
In addition to paying the $80,000 fee, the government's outlays will include $25,000 in mailing costs for sending brochures to potential attendees; $48,000 for the salaries of 46 federal employees who will attend the meeting, and $40,700 for their travel expenses to Los Angeles.
After noting that various expenses of the meeting "could well be considered extravagant for a government-sponsored conference," Kusserow said he will recommend that the Department of Health and Human Services adopt formal guidelines for spending at its sponsored events.