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Bye-Bye Governors: A Budgeteer Gets Tapped to Call the Shots at HHS

By John Reichard, CQ HealthBeat Editor

April 11, 2014 -- Sylvia Mathews Burwell, if confirmed, would be the first secretary of Health and Human Services (HHS) since the Clinton administration who isn't a former governor.

That's probably a good thing. Running the sprawling agency now is less about getting big laws done than about making them work.

Burwell is a budget expert and a seasoned federal manager who's held top posts at the White House Office of Management and Budget (OMB) and the Treasury Department. She also did a stint as deputy chief of staff in Bill Clinton's White House.

Her nomination underscores how the Obama administration is doing whatever it can to leverage the unexpected break it caught in the almost shocking recent downturn in national health spending growth.

It's also about getting to the bottom of big administrative messes. HHS and the states are increasingly at odds over the backlog of Medicaid applications that's keeping hundreds of thousands of people from getting the coverage they were promised under the health law (PL 111-148, PL 111-152).

It's about delving into the details of emerging administrative challenges and putting a system of accountability in place to prevent more technological breakdowns. The crash of the federal insurance website crash almost sank President Barack Obama's hopes for a presidency marked by historic progress in expanding access to health care and blindsided many of the law's staunch supporters in Congress.

Though she's never run a bureaucracy as large as HHS, Burwell is seen as someone who can supervise and fix things—and not as an ideological warrior or career politician.

Former HHS Secretary Tommy Thompson, a longtime Republican governor of Wisconsin, was identified with the then-controversial 2003 Medicare overhaul (PL 108-173), as was his successor, Michael Leavitt. Leavitt was viewed suspiciously by Democrats in part because of his efforts as governor of Utah to overhaul Medicaid.

Former Kansas Democratic Gov. Kathleen Sebelius helped sell the health law with her plainspoken manner and calm demeanor, even when facing harsh attacks. But's failure won't soon be forgotten, despite the fact that perhaps millions of American who lacked health coverage before the health law now have it.

Burwell's background and lack of a public persona should help her cruise to confirmation in the Senate and ease her first weeks in the new job. The administration is wagering her ascension will mark the start of a period in which Americans begin to accept the law, and lawmakers, however grudgingly, decide to live with it and try to fix its flaws.

But Burwell may face unreasonable expectations. She'll be judged by whether Medicaid expansions continue in Republican-led states, as they did when Sebelius negotiated with her former peers.

Bill Hoagland, who for many years served as a GOP aide on the Senate Budget Committee, noted that he negotiated with Burwell when she served at OMB during the Clinton administration but said her recent experience has been relatively brief.

"I'm a little surprised that she would be moving this quickly over there," he said in an interview late last week. "She just submitted her first budget and now she's out of there. Maybe it highlights what the real issue is. And the real issue of federal spending is over there in the HHS budget."

"It must say something about their respect for her as a manager of an agency because that is a huge undertaking," Hoagland added. "It also says to me something about her ability to have a direct line to the president on the very difficult issues still before HHS in terms of the implementation of the Affordable Care Act" and the costs of Medicaid and Social Security disability payments.

"This does mean even closer connections between the White House and HHS," agreed Mark McClellan, who ran the Centers for Medicare and Medicaid Services during the George W. Bush administration. "A lot of people may focus on how that may mean more White House control, but it works both ways. Having that close connection and experience with the president and his policy goals means she'll be trusted to lead at the department as well and that could help HHS get more things accomplished faster."

Beyond the health law, Obama clearly would like to be remembered for steering the nation away from more deficit spending following the economic crash. But any such expectations may be setting Burwell up for failure, Hoagland said. Hoagland sees the slowdown in health spending as the result of "one off" events. Even though per capita Medicare spending growth is down, there are "many per capitas" coming with an aging population, he noted. Hoagland said he expects per capita spending to rise also as enrollment expands.

Matt Salo, executive director of the National Association of Medicaid Directors, said he doesn't have a sense yet of how Burwell will fare with Medicaid expansions or whether she can duplicate Sebelius' success in states such as Arkansas, where a deal allows Medicaid expansion to occur strictly through private plan enrollment on insurance exchanges. It's an approach other red states are watching with interest.

Mastering the technological problems Sebelius faced will be no small matter, Salo added. "You can't say enough how complex the IT challenge is at the heart of all this. We see it every day in Medicaid," he said. Federal officials "saw it trying to build Very few people in outside world appreciate how hard this stuff is."

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