Business & Lobbying

K Street to rake in healthcare cash; ‘Lobbyist Full-Employment Act’

K Street looks like a winner if healthcare reform reaches President Barack Obama’s desk.

Even though more than one lobbyist described healthcare reform as once-in-a-generation legislation, lobbyists speaking on background predicted a busy 2010 and beyond.

{mosads}“Every bill we’ve passed in the last 10 years we call ‘The Lobbyist Full-Employment Act,’ ” one lobbyist quipped. “Healthcare’s never going away.”

If healthcare reform passes, lobbyists for healthcare industries will be plenty busy trying to influence the implementation of the bill, both in Congress and in the Obama administration.

Sectors targeted for cuts in the bill will immediately begin trying to claw back the money they stand to lose. And lobbyists representing smaller interests will try to band together to get their perennial issues handled.

“If we were to pass this bad boy, we’re going to be working on this thing for 10 years solid,” a healthcare lobbyist said. “There’s going to be one mother of a fix-it bill before 2013.

“Good God, think about the business that would be generated by this thing,” the lobbyist said.

This year’s effort to overhaul the entire U.S. healthcare system has generated an enormous amount of lobbying from every player in the sector, the predictable result being a probable record year for healthcare lobbying revenue.

Through the end of July, interest groups had spent $263.6 million lobbying on healthcare, compared to the record $485.4 million from all of last year, according to data from the Center for Responsive Politics. The 2009 figure will balloon during the second half of 2009 as legislative activity reaches a fever pitch.

To be sure, even the most optimistic lobbyists do not expect anything to match the magnitude of this year’s healthcare reform battle. “Nothing could be this intense,” another lobbyist remarked.

“It will diminish somewhat because this is a once-in-a-generation bill. It won’t be as intense next year, but there won’t be a dearth of legislative activity,” the K Streeter said. “If nothing else, there’ll be all these guys doing stuff on rules and regulation.”

History suggests that lobbyists who expect the cash to keep flowing are on to something.

Over the past decade or so, Congress has passed a handful of major healthcare bills. Each led to follow-up legislation that may not have attracted the public interest but definitely attracted lobbyists to Capitol Hill.

In 1997, Congress slashed Medicare spending as part of the Balanced Budget Act. But much of those cuts never took place as lobbyists for healthcare interests persuaded Congress it had gone too far. The results were bills passed in 1999 and 2000 to give some of that money back.

“Givebacks” were part of the Medicare Modernization Act that created the Part D prescription drug benefit and expanded the private Medicare Advantage program in 2003 as well. In turn, the launch of Part D and the growth of Medicare Advantage produced a flurry of lobbying once they were implemented.

When Democrats took control of Congress in 2007, healthcare lobbyists turned to defending favored programs from cuts and working to inflate or defend their slice of the federal pie through bills such as this year’s expansion of the Children’s Health Insurance Program

That pattern can only repeat itself when it comes to the budget cuts that make up a big part of healthcare reform, one lobbyist predicted. “All these supposed savings in this bill — a lot of those are going to be deferred.” And because 2010 is an election year, this lobbyist remarked, lawmakers will be attentive to influential, moneyed special interests in their districts and states.

The current debate on preventing cuts to physicians who treat Medicare patients also underscores how healthcare seems to provide nearly limitless opportunities for healthcare lobbyists.

Congress has been unable or unwilling to find ways to cover the ever-increasing cost of fixing this problem — now pegged at $247 billion over 10 years — so lawmakers enacted a series of short-term fixes.

The physician lobby has had little choice but to make the annual “doc fix” its No. 1 priority. Next year, doctors would get a 21 percent cut without Congress’s help.

{mosads}But it’s not just physician groups that have to work hard when Medicare legislation looms.

Representatives of hospitals and other providers must lobby hard to protect their own payments from lawmakers hungry for budgetary offsets. In addition, lower-profile issues always need addressing, such as extending special payments for rural hospitals or preventing unwanted cuts in physical therapy benefits.

Without a big legislative vehicle like healthcare reform, the Medicare prescription drug benefit or the Balanced Budget Act, healthcare lobbyists will have to get more creative. “When there’s not some sort of overarching, key issue,” a lobbyist explained, “all these provisions end up being a large kind of Medicare bill unto themselves.

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