What's Next?

Grace-Marie Turner

The health policy landscape was transformed by a huge earthquake this week  when former Sen. Tom Daschle withdrew his name for nomination as secretary of Health and Human Services. The likely result, in the short term at least, is that the power center in health reform will remain with the Cognress, not the Obama administration.

Daschle was in a unique position to wield extraordinary power because so many of his former staffers recently have been appointed to key positions in the Obama administration and because of his incredible incluence on Capital Hill as a former Senate leader. And as an early supporter of Mr. Obama for the Democratic nomination, Daschle enjoyed strong personal rapport with the new president.

Liberals believe that unique combination made comprehensive health reform a near certainty. News reports say the White House is shell-shocked and is at a loss now about who will fill the void since they didn't even have a second person in mind for the HHS job.

The list of potential contenders now, however, is quite long - Democratic governors such as Kathleen Sebelius of Kansas and Deval Patrick of Massachusetts, former Republican Massachusetts Gov. Mitt Romney, Sen. Ron Wyden of Oregon, and Mayo Clinic President and CEO Denis Cortese, M.D. Former Democratic National Committee Chairman Howard Dean, a physician, also has been mentioned, but he and White House Chief of Staff Rahm Emanuel barely speak to each other; so if that happens, the fireworks would be quite interesting.

While Daschle still could have been confirmed by the Senate, it just wasn't tenable for the Obama administration to have to continue to defend two tax cheats in his administration, after getting Treasury Secretary Geithner approved despite his failure to pay $43,000 in back taxes. The air of privilege over Sen. Daschle's failure to report and pay $146,000 in taxes and interest for the use of a full-time car and chauffeur was particularly jarring.

So what's next?

  • First, there will be a delay at HHS. Unless a suitable replacement already is far along in the vetting process for some other job, it will take some time before another nominee is selected. The Obama administration simply can't afford another mistake.
  • Second, Cognress will take its own sweet time. Leaders in Congress already had said that it is unlikely major health reform legislation would happen this year. They want to build support among the various constituencies for tough reform measures and are finding that is harder than anticipated. The House Small Business Committee, for example, heard this week from small businesses virtually pleading with Congress not to impose a jobs-killing, and possibly business-killing, health insurance mandate.
  • Third, Congress will have more power now. Daschle would have been a powerhouse directing heatlh reform, and it's going to be difficult to fill that role. But that may be just as well with Congress where committee chairmen with decades of experience are more than ready to take the lead. This means an individual mandate certianly will be in play.
  • Fourth, reofrm is well underway anyway. Even if Congress doesn't get to comprehensive health reform soon, it already is well on its way to drawing millions more people into government-controlled health programs.

President Obama signed a massive expansion of the State Children's Health Insurance Program on Wednesday. The stimulus bill contains tens of billions of dollars in spending to create more middle-class entitlements to health coverage through Medicaid expansion and creation of new government programs. And these two bills, coupled with the administration's regulatory machinery, are like a vortext drawing other huge segments of the health sector udner government control, as we reported last week.

So Daschle's road to the nomination was stopped by a chauffeur-driven limousine, and there is a big traffic jam behind it now. But the journey still has just begun.

Grace-Marie Turner is President of the Galen Institute
Copyright 2009. All Rights Reserved.



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