HEALTH CARE REGULATORY AND POLICY ALERT SPECIAL EDITION: THE 2012 POST-ELECTION LANDSCAPE

Transcription

1 HEALTH CARE REGULATORY AND POLICY ALERT SPECIAL EDITION: THE 2012 POST-ELECTION LANDSCAPE

2 TABLE OF CONTENTS INTRODUCTION...1 ELECTION RESULTS...2 Presidential Election...2 Congress...3 Gubernatorial Contests...4 Effect on Congressional Leadership...4 LAME DUCK SESSION TH CONGRESS OUTLOOK...8 Affordable Care Act...8 Medicare/Medicaid...9 Potential Changes Key Committees...9 CONCLUSION...13 About the DLA Piper Health Care Regulatory and Policy Group...14

3 I. INTRODUCTION After one of the longest, most divisive, and most expensive elections in the country s history, Americans woke up on November 7 to a political landscape that appeared largely unchanged. President Obama won reelection to the presidency, Democrats retained control of the Senate, and Republicans retained control of the House of Representatives. National exit polls revealed an electorate that remained deeply divided: a slight majority believed the country was on the wrong track, but 54% approved of President Obama s job performance. 1 On health care, the election results were likewise divided. Early exit polls suggested that the electorate remained split on President Obama s signature domestic reform accomplishment, the 2010 health care reform law (the Affordable Care Act, or ACA (P.L )); half of those surveyed supported full or partial repeal, while the other half supported leaving the law as-is or expanding it. 2 However, despite intense campaigning on health care issues by both candidates, most voters cited the economy as the most important issue on their minds in early exit polls, with health care tied with the deficit as a distant second at 18%. 3 Voters in Florida dealt a surprise defeat to a state constitutional amendment rejecting the ACA s individual mandate, while voters in Alabama, Montana and Wyoming approved similar measures. While the state provisions are largely symbolic since the federal mandate will trump inconsistent state laws, they are demonstrative of an electorate that remains deeply uncertain about the impact of the ACA and opposed to some of the law s critical components. Women s health issues were also at the political forefront in Although many political observers expected both parties to steer away from controversial social issues, abortion and women s health care took on an outsized presence toward the end of the campaign, partly as a result of controversial statements by several Republican candidates and Democrats decision to play offense locally and nationally by continuing to highlight these statements. The victories of once long-shot candidates Sen. Claire McCaskill (D-MO), Indiana Senate candidate Joe Donnelly (D) and Illinois House candidate Tammy Duckworth (D) were all credited in part to controversial statements on abortion made by Republican challengers. Below the surface, however, the election results may be a harbinger of significant change. The 112th Congress was mired in partisan gridlock, and nowhere was that more obvious than with regard to health care. The Republican House focused on the repeal of the ACA and the restructuring of Medicare and Medicaid, the Democratic Senate fought to defend and promote the ACA and existing programs, and the Administration proceeded cautiously with ACA implementation while leaving itself open to entitlement reform as a component of deficit reduction. By early 2012, any progress had slowed to a crawl as both parties waited out the elections. The 2012 election results establish that the ACA is now definitively the law of the land and that the Romney/Ryan proposals to restructure Medicare and Medicaid will not be enacted. With these matters settled, and with the nation staring down the fiscal cliff, both parties may have 1 Tom Curry, Voters back Obama despite economic concerns, exit polls show, Nov. 6, 2012, NBC NEWS, available at 2 Elise Viebeck, Exit polls find voters split on Obama health law, Nov. 6, 2012, THE HILL, available at 3 Emily Schultheis, Exit polls 2012: How President Obama Won, Nov. 7, 2012, POLITICO, available at politico.com/news/stories/1112/83461.html. 1

4 an incentive to come back to the bargaining table. A deficit reduction agreement is widely anticipated to include health care provisions, including Medicare and Medicaid cuts and/or programmatic changes. In the meantime, implementation of the ACA by the federal government as well as the 50 states is expected to accelerate. Health care will remain a significant focus of the 113th Congress, with both Democrats and Republicans shifting their focus to implementation. Specifically, House Republicans will increase oversight and investigations activity as it relates to the Administration s implementation of the law. Below, we have provided a brief summary of the election results and the potential for short and long-term effects on health care delivery and industry stakeholders. All vote totals are preliminary and current as of publication. Although the outcome of the upcoming Lame Duck session is far from certain, stakeholders should brace for potentially significant policy shifts in the next year as a result of deficit reduction efforts and the upcoming fiscal cliff. II. ELECTION RESULTS A. Presidential Election Surprising many observers who anticipated a long, drawn-out ballot counting process, President Obama won reelection on Tuesday night with strong showings in hotly contested battleground states. The President held historical Democratic strongholds Pennsylvania (52% Obama, 46.8% Romney), Michigan (53.8% Obama/45.3% Romney), and Wisconsin (52.8% Obama, 46.1% Romney), while winning battlegrounds Colorado (51.2% Obama/46.5% Romney), New Mexico (52.9% Obama/43% Romney), Nevada (52.3% Obama/45.7% Romney), New Hampshire (52.2% Obama/46.5% Romney), Iowa (52.1% Obama/46.5% Romney), Virginia (50.8% Obama/47.8% Romney), and the all-important Ohio (50.1% Obama/48.2% Romney). Governor Romney won battleground North Carolina, which went for President Obama in 2008 (50.6% Romney/48.4% Obama). As of publication, Florida was too close to call, but President Obama maintained a narrow lead. Winning Florida would give President Obama 332 electoral votes to Governor Romney s 206; if Governor Romney wins Florida, President Obama would win with 303 electoral votes to Governor Romney s 235. With 97% of the vote counted, the President maintained a 50% to 48% advantage in the popular vote. The President s reelection appeared to be due in large part to advantages among several key demographics: women (12-point advantage), Hispanics (40-point advantage) and African- Americans (captured 93% of the vote). 4 President Obama also maintained his advantage with young voters. The President s supporters turned out in high numbers, surprising some observers who predicted that the President would be unable to match voter enthusiasm for his historic 2008 election; however, President Obama won reelection with smaller margins in the electoral college and popular vote than in Id. 2

5 B. Congress Democrats retained control of the Senate on Election Day as a series of unexpected primary defeats and political missteps by Republican candidates proved too much to overcome. Democrats entered the 2012 elections defending 23 Senate seats against only 10 seats held by Republicans the largest differential since 1980 (the election that brought Ronald Reagan to the White House and flipped the Senate from Democrat to Republican control). However, Democrats ultimately expanded the seat majority they held in the Senate since 2010 to (including two Independents who caucus or are expected to caucus with the Democrats). U.S. Senate 113th Congress Several noteworthy new Senators will join the 113th Congress, including Rep. Chris Murphy (D- CT), Rep. Tammy Baldwin (D-WI), Ted Cruz (R-TX), and Deb Fischer (R-NE), who defeated Democrat Bob Kerrey and flipped the seat formerly held by Sen. Ben Nelson (D-NE) to 3

6 Republicans. In three of the most contentious races of this cycle, Elizabeth Warren (D-MA) defeated the incumbent Sen. Scott Brown (R-MA), Rep. Joe Donnelly (D-IN) defeated Richard Mourdock (R-IN), and Heidi Heitkamp (D-ND) secured a narrow victory over Rep. Rick Berg (R- ND) to keep the seat of retiring Senate Budget Chairman Kent Conrad (D-ND) in Democratic hands. Veterans Sen. Claire McCaskill (D-MO) and Sen. Sherrod Brown (D-OH) also successfully defended their seats, and Sen. Jon Tester (D-MT) narrowly survived a strong challenge from Rep. Denny Rehberg (R-MT). Former Maine governor and Independent Angus King (I-ME) will fill the seat held by retiring Republican Sen. Olympia Snowe, and is widely expected to caucus with Democrats. U.S. House 113th Congress As predicted by many pundits, the Republicans will retain control of the House of Representatives during the 113th Congress. As of the time of publication, the partisan split in the House was 234 Republicans and 193 Democrats, with 8 races yet to be decided. Speaker Boehner will retain his gavel, while Majority Leader Eric Cantor (R-VA) and Majority Whip Kevin McCarthy (R-CA) are expected to return to their respective positions. C. Gubernatorial Contests With few exceptions, the 2012 elections did not significantly shift the partisan makeup of the nation's governors. With only 11 governorships on the ballot, mostly in safely red or blue states, very little changeover was expected. Of particular note was the victory by former Charlotte Mayor Pat McCrory (R) in the North Carolina gubernatorial race. Governor-Elect McCrory's victory was the only governorship that switched partisan hands on election night. As of the time of publication, gubernatorial elections in Washington and Montana remained undecided. D. Effect on Congressional Leadership The election results should only have a moderate effect on House and Senate Leadership. The highest profile open position is the Senate Republican Whip slot being vacated by retiring Sen. Jon Kyl (R-AZ). While Sen. John Cornyn (R-TX) is the only declared candidate for the position, other candidates rumored to have interest in moving up the leadership ladder include current Republican Conference Chair Sen. John Thune (R-SD) and former House Majority Whip Sen. Roy Blunt (R-MO). However, Sen. Cornyn has served two terms as Chairman of the National Republican Senatorial Committee (NRSC), and may seek to chair the NRSC for a third cycle. On the House side, no major leadership vacancies have been announced. However, speculation persists that current members of the House Democratic Leadership including 4

7 Leader Nancy Pelosi may soon retire, particularly since Democrats failed to pick up many seats in the 2012 elections. Current members of the Democratic inner circle, such as Rep. Chris Van Hollen (D-MD), are seen as likely to run for a higher position if a retirement occurs. Rumors swirled when Leader Pelosi announced that Leadership elections would be pushed back to late November, with some hypothesizing that Pelosi wanted to give potential challengers to Minority Whip Steny Hoyer (D-MD) time to rally support. Leadership elections in both chambers are expected to be held in November. changes in the leadership of key Committees are discussed in more detail below. Potential III. LAME DUCK SESSION Congress returns on November 13 for a Lame Duck session that may be one of the most challenging to date. At issue are a host of critical unsettled matters, commonly referred to as the fiscal cliff The expiration of the Bush tax cuts (December 31, 2012); The expiration of the latest patch to the Medicare Sustainable Growth Rate (SGR) formula ( doc fix ) (December 31, 2012); The expiration of the so-called Medicare extenders (December 31, 2012); The expiration of the payroll tax cut (December 31, 2012); The expiration of emergency unemployment benefits (December 31, 2012); The start of the sequestration put in motion by the 2011 deficit reduction deal (January 2, 2013); The annual Alternative Minimum Tax (AMT) patch (must be enacted by December 31, 2012); and The expiration of the so-called tax extender package (including the research and development (R&D) tax credit) (expired December 31, 2011, but often renewed retroactively). FISCAL CLIFF TIMELINE In addition to the above, Senate Majority Leader Reid (D-NV) has suggested that other items might be raised during the Lame Duck, such as a cybersecurity bill, an online poker bill, and if bipartisan agreement is reached track and trace pharmaceutical supply chain legislation. The Congressional Budget Office (CBO) has estimated that the impact of the fiscal cliff would be devastating: a 0.5% decrease in gross domestic product (GDP) and unemployment rising to 5

8 9%. Some experts have estimated that the impact would be far worse. Sequestration the automatic reduction of mandatory and discretionary spending that resulted from the failure of the 2011 supercommittee to work out a comprehensive deficit reduction deal would have significant consequences for many U.S. businesses. According to a recent report by the Office of Management and Budget (OMB), sequestration will require $54.67 billion in non-defense cuts each year from 2013 to Many of these cuts will come from health programs, with some programs seeing up to 8.6% annual reductions. Although Medicaid is exempt from sequestration and cuts to Medicare are capped at 2%, these cuts could have a significant impact on businesses across the health care sector. Although Democratic and Republican Leadership have publicly stated that the fiscal cliff cannot be allowed to go into effect, negotiations were hampered by the 2012 elections with each party hoping that they would gain a post-election advantage and the fallout from the failed 2011 deficit reduction negotiations. President Obama and Speaker Boehner have reportedly not discussed the fiscal cliff in months. The most significant bipartisan effort to avoid sequestration was a renewed round of discussions by the so-called Senate Gang of Eight (the Gang of Six that worked to find a bipartisan deficit reduction solution in 2011 Sens. Warner (D-VA), Chambliss (R-GA), Coburn (R-OK), Conrad (D-ND), Crapo (R-ID), and Durbin (D-IL) together with Sens. Bennet (D-CO) and Alexander (R-TN)). Although Members of the Gang have met frequently and appear committed to seeking a solution, they have not yet produced a plan, and by many accounts remain divided on key issues. The tight congressional calendar adds another layer of complexity to what promises to be challenging negotiations. The House and Senate are slated to return on November 13, but with scheduled recesses for Thanksgiving and Leadership elections scheduled for November, Congress will have limited time to seek a solution. With this in mind, possible outcomes for the Lame Duck range from no action at all to a potential grand bargain No action Given the complexity of the issues at hand, the short timeframe for action, and wide partisan divides that may have been deepened by the 2012 elections, it is possible that Congress will be unable to agree to any deal to postpone the fiscal cliff, and will adjourn and leave the matter to the 113th Congress. Given the potentially catastrophic impact of even a short-term fall over the fiscal cliff, however, Congressional Leadership can be expected to try to avoid this scenario. Must do items only In lieu of complete failure to resolve the fiscal cliff, Congress could instead strike a limited bargain to deal with the least controversial and most urgent provisions: the AMT patch (which the IRS has said cannot be done retroactively) and the doc fix (which has bipartisan support, a large and vocal constituency, and potentially devastating consequences for Medicare beneficiaries if not resolved before December 31). Congress may be able to find relatively noncontroversial offsets for a short-term extension of these provisions, leaving the remainder of the issues to the 113th Congress. Kick the can Alternately, Democratic and Republican Leadership could strike a deal to kick the can into 2013 by postponing the effective date of many of the elements of 6

9 the fiscal cliff (perhaps by three to six months). scenario: There are several variants of this o First, the legislation could have no offsets (spending cuts or revenue-raising measures designed to offset the cost of postponing elements of the fiscal cliff). This is perhaps unlikely, as many Republicans have insisted on offsets for virtually all measures in the 112th Congress. o Alternately, the legislation could have partial offsets in the form of relatively noncontroversial cuts (i.e., a down payment on a larger reform package). o The legislation could also be fully offset. This is perhaps unlikely, given the scale of the offset package that would be required and the controversial nature of many of the cuts. Such a deal might also be accompanied by the establishment of a new process to negotiate a larger deficit reduction deal, such as instructions to House and Senate Committees along with certain revenue targets (for example, committees would be instructed to report out legislation meeting a certain deficit reduction target as a result of policy changes to programs under their jurisdiction by a certain date; the committee proposals would then be combined into a single replacement package). In this scenario, Congress failure to reach eventual agreement on a replacement package would result in the fiscal cliff going into effect. Grand bargain Finally, Democrats and Republicans could agree to a so-called grand bargain that would replace the sequester and pay for other necessary extensions of elements of the fiscal cliff through a combination of revenue-raisers, spending cuts, and entitlement reform. A grand bargain remains a remote possibility, however, as little groundwork has been laid for a deal of this scope; additionally, past negotiations on a grand bargain collapsed with public finger-pointing by party leaders and the Administration. Moreover, Speaker Boehner s desire to have the support of a majority of a majority of House Republicans was one of the major stumbling blocks in the 2011 deficit reduction negotiations, and this is likely to be an even more difficult task in a shortened Lame Duck session. Although the Gang of Eight could perhaps reach an agreement that could be supported by 60 Senators, it is far from certain that this deal would be supported in the House. Post-election statements offered early clues as to the possible outcomes of the Lame Duck session. In President Obama s acceptance speech early on November 7, he spoke of looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together. Senate Majority Leader Reid similarly urged Republicans and Democrats to come together, saying, [w]e know what the issues are, let s solve them. On Wednesday afternoon, Speaker Boehner suggested that the parties might seek a down payment during the Lame Duck that would temporarily avert the fiscal cliff, but ruled out raising tax rates. With deep partisan divides, difficult issues, and a short timeframe for action, it remains to be seen whether any consensus can be reached. 7

10 IV. 113TH CONGRESS OUTLOOK Like the 112th Congress, the 113th Congress is poised to contend with significant health care issues related to the ACA, Medicare, and Medicaid. A. Affordable Care Act In President Obama s second term, the Administration will continue to focus efforts on the implementation of the ACA. The second tranche of the law s provisions including the individual mandate, the state Exchanges, and essential health benefits (EHB) requirements take effect in 2014, and the states and the federal government are far from ready. Many states particularly those with Republican governors delayed implementation of the ACA until the Supreme Court ruled on the law s constitutionality. Even after the Supreme Court upheld the law, many states decided to wait for the outcome of the 2012 elections before proceeding with implementation. The Administration, likewise, must issue additional guidance related to various provisions of the ACA, including the Exchanges and EHB requirements; many believe that the Administration was waiting to release this guidance until after the elections. In the 111th and 112th Congresses, Republicans made numerous attempts to repeal or defund all or parts of the ACA, with limited success. Although Republicans are unlikely to abandon their opposition to the ACA in the 113th Congress, many have acknowledged that full repeal would be impossible if President Obama was reelected. Congressional Republicans will therefore likely shift their tactics to focus less on repeal and defunding and more on oversight and investigations particularly in the House, where Republicans retain their majority. In 2011 and early 2012, House Ways and Means Committee Chairman Camp (R-MI) and House Oversight Committee Chairman Issa (R-CA) primarily focused their oversight and investigations activity on areas other than health care; however, in the months preceding the election, the Members showed renewed interest in investigating the Administration s implementation of the ACA, culminating in Chairman Issa s subpoena of documents related to the Medicare Advantage Quality Bonus Payment Demonstration program in late October. Chairman Camp and Chairman Issa as well as House Energy & Commerce Chairman Upton (R-MI), who has spent considerable time criticizing the Administration s handling of health carerelated matters will likely continue these efforts in the 113th Congress. For their part, Congressional Democrats will face pressure to fix certain elements of the ACA. Like any significant piece of legislation, the ACA contains technical errors, and the fact that the ACA and elements of the House bill were merged through the imperfect reconciliation process created additional problems. Democrats may also want to enact legislation to deal with the Supreme Court s ruling that the federal government cannot compel states to proceed with the Medicaid expansion. However, it remains to be seen whether any legislation that improves the ACA can pass the Republican House. 8

11 B. Medicare/Medicaid The 113th Congress will also face critical choices about the future of the Medicare and Medicaid programs. These issues are likely to arise in the context of deficit reduction legislation. In FY2011, Medicare, Medicaid, and CHIP accounted for 21% of the federal budget, 5 and any deficit reduction package is likely to include some programmatic changes. When President Obama and Speaker Boehner were negotiating a resolution to the debt ceiling crisis in the fall of 2011, Democrats were reportedly open to a number of Medicare and Medicaid reforms, including modest increases in Medicare means-testing and co-pays; cuts to skilled nursing facilities, home health care, clinical labs, and rural hospitals; cuts to medical education; cuts to Medicaid; cuts to hospital bad debt; and changes to Medigap plans. Some or all of these proposals will likely reemerge in entitlement reform discussions as a component of any final deficit reduction package. Even before the final election results were tabulated, some progressive organizations began laying groundwork to combat what they perceived as a potential grand betrayal on entitlement reform by President Obama, signaling that the President will not have an easy path securing consensus even among Democrats. For their part, Republicans will press to adopt more significant reforms, such as transitioning Medicare into a premium support system and block granting Medicaid, as called for in the Ryan budget. However, Senate Democrats and President Obama will strongly resist these changes. Although Republicans have little chance of getting 60 votes in the Senate in favor of premium support and/or block-granting Medicaid, they may be able to win support for a different structural reform proposal that addresses Democratic concerns. Finding a package of reforms that will win the support of a majority of Democrats many of whom are reluctant to see any changes to Medicare and Medicaid and campaigned on preserving the programs as-is as well as satisfy Republicans anxious for more fundamental changes will be a significant challenge, and strong leadership by President Obama and Republican Leaders will be needed to win sufficient support for a final package. C. Potential Changes Key Committees While several key House and Senate Committees suffered membership losses due to retirements and campaigns for higher office, in general, leadership in House and Senate Committees with health care jurisdiction will remain the same in the 113th Congress. Senate Finance Retiring o D: Kent Conrad (ND); Jeff Bingaman (NM) o R: Jon Kyl (AZ); Olympia Snowe (ME) Seats on the powerful Senate Finance Committee are historically coveted by members of both parties. The 113th Congress will be no different as, depending on final Committee ratios, at 5 CENTER ON BUDGET AND POLICY PRIORITIES, Policy Basics: Where Do Our Federal Tax Dollars Go? (Aug. 13, 2012), at 9

12 least two seats on each side of the aisle will be filled by new Committee members. Retiring Sens. Conrad (D-ND), Bingaman (D-NM), Kyl (R-AZ), and Snowe (R-ME) have combined to serve in the Senate for nearly a century, and will take a wealth of institutional knowledge with them when they leave the Senate at the end of this year. Senate Finance Committee leadership should remain stable for the 113th Congress. Sen. Max Baucus (MT) is expected to remain the top Democrat on the Committee. On the Republican side of the aisle, while there was some speculation that former Committee Chairman and Ranking Member Charles Grassley (R-IA) might attempt to reclaim the top Republican spot on the Committee if Republicans won control of the chamber, Sen. Orrin Hatch (UT) is expected to remain the lead Committee Republican. Health, Education, Labor, and Pensions (HELP) Retiring o D: Jeff Bingaman (NM) The election will not significantly impact the HELP Committee on the majority side as Sen. Tom Harkin (D-IA) will continue his role as top Committee Democrat. On the Republican side, Sen. Mike Enzi (WY) is term-limited from continuing his role as Ranking Member of the Committee. Next in seniority for the Republican side is Sen. Lamar Alexander (TN), while Sen. Richard Burr (NC) may also be interested in the post. Sen. Jeff Bingaman (D-NM) is the only current Committee member who will not be returning in the 113th Congress. Appropriations Retiring o D: Herb Kohl (WI); Ben Nelson (NE) o R: Kay Bailey Hutchison (TX) Several long-serving members of the Senate Committee on Appropriations will retire at the end of the 112th Congress, including Agriculture Subcommittee Chairman Kohl (D-WI), Legislative Branch Subcommittee Chairman Nelson (D-NE), and Commerce Subcommittee Ranking Member Hutchison (R-TX). Sens. Kohl and Hutchison will also leave behind two vacancies on the influential Subcommittee on Labor, HHS, and Education, although Sen. Harkin (D-IA) is expected to continue as Chair. Meanwhile, Sen. Daniel Inouye (HI) is expected to remain the top Democrat on the panel, but party term limit rules will prevent Sen. Thad Cochran (R-MS) from continuing as the Committee Ranking Member. Sen. Richard Shelby (R-AL) is expected to assume Sen. Cochran s slot as Ranking Member in the 113th Congress. Budget Retiring o D: Chairman Kent Conrad (ND) There will be limited, but significant changes to the Senate Budget Committee next Congress. With the retirement of Chairman Kent Conrad (D-ND), Democrats will select a new Committee leader for the 113th Congress. Next in seniority following Sen. Conrad on the Committee are 10

13 Senators Patty Murray (WA), Ron Wyden (OR), and Bill Nelson (FL). Sen. Jeff Sessions (AL) is expected to remain the lead Committee Republican. House Ways and Means Retiring o R: Wally Herger (CA); Geoff Davis (KY) Pursued Higher Office o D: Shelley Berkley (NV) (ran for Senate) (defeated) o R: Rick Berg (ND) (ran for Senate) (defeated) Defeated o D: Pete Stark (D) Ways and Means Health Subcommittee Chairman Wally Herger (R-CA) is among the Committee members who will not be returning in the 113th Congress. Chairman Dave Camp (R-MI) and Ranking Member Sander Levin (D-MI) are expected to retain their leadership positions on the Committee in Committee slots opened through the election will be among the most coveted positions available when the 113th Congress convenes. Among the biggest electoral shakeups in the House, long-time Ways and Means Committee member and former Health Subcommittee Ranking Member and Chairman Pete Stark (D-CA) lost his bid for a 21st term in the House. Committee Members who may take over his role on the Subcommittee include Rep. Mike Thompson (D-CA) and Rep. Jim McDermott (D-WA). Meanwhile, Rep. Charles Boustany (R-LA) will need to survive a runoff election in early December to retain his seat on the Committee, and Reps. Rick Berg (R-ND) and Shelley Berkley (R-NV) will leave the House as a result of their Senate runs. Energy and Commerce Retiring o D: Ed Towns (NY); Charlie Gonzalez (TX); Mike Ross (AR) o R: Sue Myrick (NC) Pursued Higher Office o D: Jay Inslee (WA) (ran for Governor) (undecided); Tammy Baldwin (WI) (ran for Senate) (elected) Defeated o R: Cliff Stearns (FL); John Sullivan (OK); Charlie Bass (NH); Mary Bono Mack (CA) Little change is expected at the top of the Energy and Commerce Committee next year, as both Chairman Fred Upton (R-MI) and Ranking Member Henry Waxman (D-CA) are expected to retain their Committee leadership positions. However, current Oversight and Investigations Subcommittee Chairman Cliff Stearns (R-FL) was among the Committee election casualties, losing to a relatively unknown challenger in the 2012 Republican primary. Three Democrats including moderate Blue Dog Rep. Mike Ross (D-AR) as well as Rep. Sue Myrick (R-NC) were among the Committee s retirees, while Rep. Mary Bono Mack (R-CA) and Rep. Charlie 11

14 Bass (R-NH) both lost their reelection bids. At the time of publication, Rep. Brian Bilbray (R-CA) remained locked in a tight, undecided battle for his San Diego area Congressional seat, while Rep. Tammy Baldwin (D-WI) will move to the Senate. Appropriations Retiring o D: Norm Dicks (WA); John Olver (MA); Maurice Hinchey (NY) o R: Jerry Lewis (CA); Steve LaTourette (OH); Steve Austria (OH) Pursued Higher Office o R: Denny Rehberg (MT) (ran for Senate) (defeated); Jeff Flake (AZ) (ran for Senate) (elected) Defeated o D: Steve Rothman (NJ) Several leading members of the House Appropriations Committee will depart the Committee in the 113th Congress. Most notably, Ranking Member Norm Dicks (D-WA) will retire at the end of this year. The race to replace him is expected to feature three long-time members of the Committee: Reps. Marcy Kaptur (D-OH), Nita Lowey (D-NY), and Rosa DeLauro (D-CT). Meanwhile, the powerful Labor, HHS, and Education Subcommittee is assured to have new leadership when Congress reconvenes next year, as current Chairman Rehberg elected to run for Senate. Budget Retiring o D: Heath Shuler (NC) Pursued Higher Office o R: Todd Akin (MO) (ran for Senate) (defeated), Paul Ryan (WI) (ran for Vice President) (defeated, but re-elected to House seat) Defeated o R: Frank Guinta (NH) While House Budget Chairman Paul Ryan s (R-WI) vice presidential bid was unsuccessful, he easily defeated his Democratic challenger to retain his Wisconsin House seat. While Chairman Ryan would need a term-limit waiver from Republican Leadership to return to the House Budget Committee, this is widely seen as a formality and Chairman Ryan is expected to retain his leadership position. On the minority side, Rep. Chris Van Hollen (D-MD) may retain his role as leading Democrat on the Committee, but rumors persist that he will choose to run for an undetermined Democratic Leadership position. 12

15 V. CONCLUSION With the reelection of President Obama and control of the House and Senate remaining unchanged, the post-election political landscape looks, on its surface, very similar to the preelection landscape. However, with the elections over and the fiscal cliff looming, Republicans and Democrats will face significant pressure to break through the partisan gridlock of the 112th Congress and reach a compromise to address the fiscal challenges facing the country. A deficit reduction agreement is widely anticipated to include health care provisions, including Medicare and Medicaid cuts and/or programmatic changes, and cost containment will be at the forefront of discussions. Meanwhile, while Republicans can be expected to continue their opposition to the ACA, the reelection of President Obama clears the path for intensified implementation of the legislation. As such, stakeholders should prepare for increased action and potentially significant policy shifts in the coming months. 13

16 About the DLA Piper Health Care Regulatory and Policy Group DLA Piper s Health Care Regulatory and Policy Group includes a group of attorneys and nonlawyer consultants who have expertise on a wide range of health care advocacy, policy, regulatory, and legal issues. Chaired by Mary Langowski, the group is bipartisan and bicameral and has worked for key members of Congress on health care committees of jurisdiction as well as in key agencies. The team works with a range of health care companies across the sector to provide strategic advice as well as advocacy, policy, and regulatory services. Consequently, team members have a deep understanding of health care policy and regulations as well as the industry, which enables us to be effective strategists and partners with our clients. About DLA Piper DLA Piper is a large, global firm with over 4,200 attorneys worldwide. Members of our nationally recognized Government Affairs team have served in senior elected, appointed and staff positions in Congress, various Administrations and state governments. Our Government Affairs team is co-chaired by former Michigan Governor and former US Ambassador to Canada, Jim Blanchard, and Thomas M. Boyd, former Assistant Attorney General in the Office of Legislative Affairs at the Department of Justice. Our team also includes Senator Tom Daschle, the former Senate Majority Leader and a nationally recognized expert in health care. DLA Piper is also fortunate to have another former Senator Majority Leader and former U.S. Special Envoy for Middle East Peace, George Mitchell (D-ME), serving as Chairman Emeritus and as an ex officio member on the firm s Global Board, and to have former Congressman and Governor Mike Castle (R-DE) as part of our team. These distinguished former officials enable DLA to bring a range of expertise, strategy, and visibility to the issues that matter to clients. Beyond our federal affairs and policy capabilities, the size and reach of our firm enables us to draw from a variety of sources to address legal issues that may arise, to engage in state outreach on the behalf of clients, and even to strategize and execute global client strategies. Team Members Sen. Thomas A. Daschle provides clients with strategic public policy advice on a wide range of international and economic issues. Senator Daschle has participated in the development and debate of almost every major public policy issue of the last three decades. In 1978, he was elected to the US House of Representatives, where he served for eight years. In 1986, he was elected to the US Senate and was chosen as Senate Democratic Leader in Senator Daschle is one of the longest serving Senate Democratic leaders in history and the only one to serve twice as both Majority and Minority Leader. Gov. Michael Castle served as Governor of the State of Delaware for two terms, as US Congressman for nine terms, and as Lieutenant Governor, Deputy Attorney General and State Senator. He has always held a deep interest in health care issues, and throughout his public life he has worked across party lines, building bridges and forming coalitions to find pragmatic, bipartisan solutions to some of the most pressing problems facing the country. His extensive state and federal experience provides a unique understanding on a wide array of issues faced by businesses that are dealing with federal laws and regulations. 14

17 Mary B. Langowski leads the Health Care Policy and Regulatory Group. She has extensive experience providing strategic consultation, developing government relations strategies, identifying business development opportunities and fundraising on the local, state and federal levels. Ms. Langowski has worked with for-profit and nonprofit organizations, as well as both federal and state governments. Prior to joining DLA Piper, Ms. Langowski advised clients on a range of domestic policy issues, with special focus in health care policy and appropriations. Ms. Langowski also served as a senior policy advisor to Senator Tom Harkin, where she managed the senator's health care policy initiatives and priorities, including public health and prevention, Medicare and pharmaceutical policy. Prior to joining Senator Harkin's office, she served as the chief policy advisor at the Iowa Department of Public Health under Governor Tom Vilsack, where she advised the director and the governor on health policy and was responsible for the oversight of federally funded policy projects. Ms. Langowski has also worked in the private sector on health care quality and cost containment issues with large self-insured businesses in Iowa. Piper Nieters Su advises health care clients, such as professional health associations and providers, drug and device manufacturers and others, on sophisticated regulatory and policy matters related to federal health care program reimbursement and compliance. In addition to providing formal legal advice on health care issues, Ms. Su is also an experienced legislative and regulatory strategist, handling matters before Congress, the Department of Health and Human Services and the Centers for Medicare and Medicaid Services. Ms. Su served as legislative counsel to Senator Ken Salazar (D-CO), where she was the principal advisor for his health care-related activities on the Senate Finance Committee. In this role, Ms. Su developed numerous policy proposals that were subsequently incorporated into laws like the Medicare Improvements for Patients and Providers Act of 2008 and the Medicare, Medicaid and SCHIP Extension Act of Steven Phillips represents corporations, associations, and foreign governments before Congress, the administration, and federal agencies with a concentration on health care, tax, communications, defense, homeland security, and insurance. He also advises clients on congressional strategies, the legislative process, and the regulatory process. Prior to joining DLA Piper, Mr. Phillips served as legislative director and counsel to Senator Jesse Helms, chairman of the Foreign Relations Committee. During his 10 years in Congress, Mr. Phillips developed and implemented the senator's legislative strategy and managed his legislative staff. Mr. Phillips has longstanding relationships with many Republican staff and Members of Congress. Nicole D. Carelli handles a diverse range of legislative, administrative and policy issues in the health care sector, helping clients understand the current landscape and representing their interests before Congress and the Executive Branch. Her clients have included state governments, health insurers, providers, drug and device manufacturers and universities. She counsels clients on developing and implementing comprehensive government affairs strategies on a variety of issues, including implementation of the Affordable Care Act (ACA), Medicaid funding and compliance and Medicare reimbursement. Ms. Carelli also advises clients on a range of domestic policy issues, including appropriations and federal laws governing lobbying and ethics. 15

18 Tiffani V. Williams concentrates her practice on regulatory and legislative matters relating to the provision of health care services. She advises various segments of the health care industry including, hospitals, dialysis providers, pharmaceutical and device manufacturers, independent clinical laboratories, third-party payers, and trade associations. Ms. Williams has counseled clients on numerous health-related issues, such as Medicare coverage, coding and reimbursement, compliance with the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Health Information Technology for Economic and Clinical Health (HITECH) Act privacy and security regulations, pharmaceutical drug pricing, and health information technology. She also assists clients draft comments to various proposed and final federal agency regulations, and regularly prepares health care advisories and trending reports for clients. John B. Slotman has more than 13 years of experience in health care policy, strategy, and government relations. He has an excellent working knowledge of post-acute care policy issues. Specifically, as the lead member of the American Hospital Association federal relations team on post-acute care issues, Mr. Slotman is uniquely positioned to assist long-term care hospitals with advocacy and policy efforts regarding LTAC patient and facility criteria. Mr. Slotman has also served on the staff of the House Ways and Means Committee Subcommittee on Health and as the lead House Republican on the federal relations staff of the Generic Pharmaceutical Association. Kristen E. Ratcliff advises health care clients on a number of complex policy, regulatory and strategic matters. Ms. Ratcliff was formerly Special Assistant to the National Coordinator for Health Information Technology in the Office of the National Coordinator for Health Information Technology at the Department of Health and Human Services. In this role, she defined policy, program and operations priorities for the office s leadership, managed a government wide task force on federal health information technology policy and investments, and worked with HHS leadership to implement the Affordable Care Act. Ms. Ratcliff was also a Presidential Management Fellow, working at the Office of Management and Budget during her fellowship. 16