The Department of Health and Human Services violated federal law earlier this year when it promoted the new Medicare prescription drug bill through video news releases, the General Accounting Office concluded Wednesday.

GAO, in an opinion that does not carry the force of law, determined that HHS’s videos violated laws prohibiting government entities from spending federal dollars for “publicity or propaganda purposes.”

While such videos are common tools for private-sector public-relations clients, GAO indicated that any government agency or department that used them would run afoul of the law unless the agency clearly identified itself as the materials’ producer.

The VNRs in question were sent by HHS’s Center for Medicare and Medicaid Services to television stations and TV news feeds. They included a “story package” narrated by a “reporter” under contract to HHS that was designed to be run by television news programs unedited. The package also offered a suggested script for news anchors to lead in to the story, video clips to use for reporters to voice-over and clips of HHS officials appearing to answer interview questions.

GAO found that at least three news stations — in Atlanta, New Jersey and Baton Rouge, La. — ran the VNR story package as if it were an independently reported news story. The Baton Rouge station, WBRZ-TV, used the anchor lead-in script as well.

The GAO found that even if the news organizations had been aware that the information came from the government, the VNRs still would have violated the publicity-and-propaganda rule because the story packages did not tell viewers that they had come from the government, the GAO ruled.

“The VNR materials raise concerns as to whether they constitute ‘covert’ propaganda because they are misleading as to source,” GAO concluded. “Importantly, CMS included no statement or other reference in either story package or the anchor lead-in script to ensure that the viewing audience would be aware that CMS is the source of the purported news story.”

GAO added, “In a modest but meaningful way, the publicity and propaganda restriction helps to mark the boundary between an agency making information available to the public and agencies creating news reports unbeknownst to the receiving audience.”

In its defense, HHS provided GAO with similar VNRs produced by the Clinton administration in 1998. But GAO concluded that those too would have violated the law.

“Had we been aware of the use of story packages in [the Clinton administration] and other contexts, the principles discussed here would have been applicable,” the GAO said.

HHS spokesman Bill Pierce said HHS Secretary Tommy Thompson disagrees with the decision.

“We left the decisions directly in the hands of the TV producer in terms of what to use and how to use it, including attribution,” Pierce said.

Pierce also noted that GAO, the independent investigative arm of Congress, has no power over the executive branch.

“This is an advisory opinion and has no binding impact on the executive branch,” Pierce said. “It does not prohibit HHS from producing and distributing VNRs in the future.”

GAO recommended that because the violation of the publicity-and-propaganda rule also means that CMS and HHS made unauthorized expenditures, the department should immediately inform the White House and Congress of their infraction and await instructions from the Office of Management and Budget about remedying the situation.

Sen. Frank Lautenberg (N.J.) — one of several Democrats who requested the GAO inquiry — lauded the decision and vowed to hold the Bush administration and the president’s re-election campaign responsible for the nearly $43,000 used by CMS to produce the VNRs in English and Spanish.

Lautenberg has alleged that the VNRs’ generally upbeat view on the Medicare law were designed to boost President Bush’s re-election campaign this year.

“The Bush administration has illegally spent Medicare funds on covert political activities,” said Lautenberg. “The Bush-Cheney campaign should pay every dime they spent on these fake news stories back to our seniors. I will be introducing emergency legislation in Congress on Thursday to require the Bush-Cheney campaign to return these taxpayer dollars back to the Medicare trust fund.”