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Mulling Obama's Early Health Care Moves

By John Reichard, CQ HealthBeat Editor

November 5, 2008 -- The plan Barack Obama will pursue and the strategy he will follow is of course uncertain—but that isn't stopping Democratic health policy analysts from opining about the moves Obama will make on health care early in his presidency.

Interviews with those analysts suggest Obama will move quickly to assemble his team, with former Senate Majority Leader Tom Daschle possibly playing a leading role. Other Democrats associated with the Center for American Progress, a left-leaning think tank, also may have key slots, these analysts suggest.

Obama is able to draw on the experience of former Clinton administration health aides, who can not only help him assess talent but also warn him against missteps they made in their failed attempt to win congressional passage of Clinton's universal coverage plan, the Health Security Act.

Former Clinton health aides include Christopher Jennings, who served for eight years in the White House as a health policy adviser to Bill and Hillary Clinton; Dan Mendelson, who was in charge of health care budgets at the Office of Management and Budget; Jeanne Lambrew, who succeeded Mendelson in that capacity; and Nancy-Ann DeParle, who headed the Health Care Financing Administration, the predecessor agency to the Centers for Medicare and Medicaid Services.

Others, to name but a few, include Judy Feder, a professor at Georgetown University who served as principal deputy assistant secretary at the Department of Health and Human Services in the Clinton administration; Kevin Thurm, a former Rhodes Scholar who served as liaison between HHS and the Clinton White House; and Kenneth Thorpe, a health policy professor at Emory University who served as deputy assistant HHS secretary for health policy in the Clinton administration.

"I think you will see many of them going back," said Mendelson, who now heads the Washington, D.C., consulting firm Avalere Health. But former Clinton aides are well launched in post-government careers in business, academia, and consulting. While likely to lend their expertise when asked it doesn't follow that they would all be willing to step back full time into the fray.

There is also likely to be a limit to how many Obama will ask, since a number of his picks are likely to come from the cadre of advisers he relied on during his presidential campaign.

Those advisers include Brookings Institution fellow Jason Furman, whose expertise includes tax policy; Harvard University economist David Cutler; domestic policy adviser Neera Tanden; Harvard University health policy professor David Blumenthal, an expert on health information technology; and Dora Hughes, a former Senate Health, Education, Labor and Pensions committee staffer who serves on Obama's personal Senate staff and is an expert on disparities in health care relating to race, ethnicity, and gender.

How Obama will slot these various names is unclear. But John Podesta, who heads the Center for American Progress and served as chief of staff to President Clinton, is expected to call the shots on health care during the transition. He was one of three people announced Wednesday to co-chair Obama's transition effort, known formally as the Obama-Biden Transition Project.

One Democratic analyst said it is premature to play the name game—picking likely names to take key posts such as Centers for Medicare and Medicaid Services administrator and Food and Drug Administration commissioner for example. That's because Obama has to think through how ambitious he wants his health overhaul plan to be and consider the chemistry of the team he is trying to assemble.

A smaller-scale effort on health would dictate different appointments than a major overhaul effort, the analyst says. And until the top health post is filled, second-tier appointments such as CMS administrator and FDA commissioner may not be filled because of the need to again consider the chemistry between those at the top and their subordinates.

Figuring out the right formula to produce the best chemistry also may mean taking stock of appointments at OMB, the White House Domestic Policy Council, and the White House National Economic Council. Those appointments if done properly can smooth interagency relationships.

Part of the teamwork calculations may also include senior positions at the Treasury Department. With strong interest on the part of Republicans as well as some Democrats in changing the tax code to promote insurance coverage, Treasury may have a significant role in the health overhaul debate.

When Obama settles on his top appointments and how he wants to structure his health policy the pace of lower level appointments may pick up.

Because of Daschle's interest in health policy and his close relationship with Obama—Obama's personal staff includes former Daschle aides—the former South Dakota senator may play a role on health care akin to that of Hillary Clinton in the Clinton administration.

"It seems clear Senator Daschle will play a key role in health care reform no matter where he ends up," said another analyst, a former HHS official in the Clinton era. The precise appointment he would hold is unclear.

Podesta and Daschle's ties to Obama highlight the role the Center for American Progress may play as a showcase of the incoming administration's thinking on health policy. Not only are Podesta and Daschle affiliated with the center, but so too is former Clinton health aide Lambrew. Now a faculty member at the University of Texas, Lambrew recently joined with Daschle to write a book on overhauling health care called "Critical: What We Can Do About the Health Care Crisis."

Other writing and speaking by Lambrew suggests what may be a key part of Obama's early health care strategy, an attempt to tie a health care overhaul to action on the economy.

While the staggering costs of the Wall Street bailout would seem to rule out an ambitious health care overhaul, Democrats mention several potential strategies for coping with the costs involved, including scorable savings from capping and trading pollution permits to making a health overhaul plan part of budget reconciliation, a tactic that allows legislation with protection from filibuster.

Another is to link health care to economic stimulus legislation, which wouldn't require payment offsets. Lambrew urged in Oct. 28 testimony before the House Ways and Means Committee that Congress pass legislation in a post-election lame-duck session temporarily boosting federal payments for Medicaid and the State Children's Health Insurance Program.

But Lambrew urged a much more ambitious link. "In 2009, this committee and the new Congress should consider health reform as part of comprehensive economic reform," she said. "It is necessary," Lambrew said, adding that "job growth, savings, and public investments in other priorities such as education will continue to be stifled if health system problems continue unchecked."

"It is also an opportunity to put the nation on a path to prosperity. The return on the investment—slowing the long-run rate of health care cost growth through system improvements and seamless coverage—would arguably be the most significant economic achievement in decades."

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