Bloomberg Government Insider

Lobbyists Switch From Offense to Defense


Lobbyists Switch From Offense to Defense

Photograph by Lise Gagne/Vetta/Getty Images

With her client facing a new medical device tax, lobbyist Jenn Higgins began working the halls of Congress. For almost two years, she and fellow advocates for the medical device industry used relationships they had built to line up lawmakers from states with companies that would be affected and politicians likely to be swayed by arguments that the tax would hurt innovation and consumers.

In the end, the lobbyists got the tax lowered to $20 billion from $40 billion. But Higgins lost what she most sought—a specific exemption for items such as wheelchairs—when Congress at the last minute instead excluded “retail” devices. Suddenly, Higgins and her client, wheelchair maker Invacare (IVC), were at the mercy of the Internal Revenue Service. Government tax lawyers would decide what Congress meant. “It requires a lot of education on our part, and that’s really what lobbying has become,” says Higgins, a principal at Capitol Health Group in Washington. “They’re not going to tell you which direction they’re going to go in, but at least you have a one-way dialogue.”

When the health-care law was wending its way through Congress, there were still opportunities to gain new programs for clients, says Eric Zimmerman, a Medicare lawyer and lobbyist at McDermott Will & Emery in Washington. Now it’s almost all about defense, making sure new rules aren’t too onerous.

There’s so much paper flowing out of regulatory agencies charged with implementing the health-care law that the American Osteopathic Association hired two graduate students from George Washington University to keep up. The master’s students in public health and public policy put in 18 hours a week for 18 months reading proposed regulations and writing summaries so the professional staff could skip to figuring out how to handle the proposals. “Every week there is something pouring out that you’re having to go through,” says Shawn Martin, director of government relations for the Washington doctors’ group.

The health-care influence world has changed in other ways. There are fewer players, for one. Last year health-care clients spent just under $500 million on 3,116 lobbyists, according to the Center for Responsive Politics, which tracks money in Washington. That’s down from a record $552 million and 3,499 lobbyists two years earlier, when more than six health-care lobbyists worked the halls of power for every member of the House and the Senate.

As lobbyists spend less time with Congress, they’re spending more trying to influence agencies. They filed 4,305 reports with Congress last year saying they were seeking to influence the U.S. Department of Health and Human Services, according to the Center for Responsive Politics. That’s up 12 percent from 2009.

Health and Human Services says it doesn’t keep a tally of the regulations it’s putting out. A watchdog group, Americans for Limited Government in Fairfax, Va., says 56 regulations stemming from the health-care law have been proposed or made final, an additional 10 are open for comment, and dozens more are percolating in various stages. Rules may be pouring out for years or even decades to come, says John Vinci, staff attorney for the Virginia group.

That leaves lobbyists with the difficult task of wooing regulators. They can’t hold fundraisers for agency employees, depriving them of leverage they enjoy with elected officials. Meetings before the release of drafts are possible, though not as plentiful as they would be on Capitol Hill, lobbyists say. “This administration has made no secret about its animosity toward lobbyists and has imposed a number of formal and informal policies making it difficult for lobbyists to communicate their interests to senior leaders within the administration,” says Zimmerman.

Higgins’s fight on the medical device tax may be drawing to a close. The draft regulation came out in February, and she’s hopeful its definition of exempted devices will work for her client. The tax is due to go into effect in 2013. Before that, lobbyists and their clients will have another chance to offer comments that may or may not be heeded. “It is definitely a new world order in terms of health-care lobbying,” Higgins says.

The bottom line: After a $552 million lobbying onslaught in advance of passage of the law, K Street is focusing on the details of its implementation.

Jensen is a reporter for Bloomberg News.

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Companies Mentioned

  • IVC
    (Invacare Corp)
    • $14.88 USD
    • -0.07
    • -0.5%
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