Healthcare lobbyists stand back as budget bill implodes

Some healthcare interest groups opposed to provisions in the House budget-reconciliation bill opted to employ a somewhat untraditional strategy as last week’s vote drew nearer: backing off.

Those opposed to changes the bill would make to Medicaid had drawn lines in the sand months ago. But lobbyists representing the nursing-home industry, retail pharmacies and drug makers appear to have decided not to make a last-minute push against those provisions as lawmakers were still desperately trying to round up votes before pulling the bill from the floor last Thursday, K Street sources said.

With the prospects of a rescheduled vote uncertain at press time, lobbyists whose clients have a lot at stake may be content to remain on the sidelines and let the internal GOP battle play itself out.

A lobbyist for one healthcare interest that strongly opposes parts of the bill summed up what may be the prevailing sentiment among business groups that do not support the budget-cuts package: “The thing’s imploding on its own.”

An aggressive lobbying campaign at the 11th hour, the lobbyists said, could backfire by drawing the ire of supporters of budget reconciliation, who could blame segments of K Street if GOP leaders are unable to find the votes to pass the bill.

Special interests that want to see the bill killed — or at least see provisions they dislike jettisoned — are already beginning to look ahead to a possible House-Senate conference or to other possible vehicles that could threaten their bottom lines.

For the healthcare sector, at issue are changes to the Medicaid system that are designed to save the program $12 billion over five years. The provisions also are meant to stand as the first stage of a plan by congressional Republicans and the White House to overhaul the massive healthcare program, which was designed to serve the poor but has evolved into the country’s leading provider of nursing-home benefits.

Last Thursday, to attract moderate GOP votes, House GOP leaders reportedly offered to reopen the Medicaid language offered by Energy and Commerce Committee Chairman Joe Barton (R-Texas). House GOP moderates have complained that the Medicaid savings in the bill, as well as cuts to food stamps and other programs, would unfairly affect low-income people.

The electoral interests of these Republicans happen to be closely aligned with the economic interests of some healthcare sectors, especially the nursing homes. For example, the budget bill would make it harder for older and disabled Americans to transfer their assets to their children, a way some senior citizens have used to qualify for Medicaid’s nursing-home benefit. It also would increase the penalties for trying to do so.

Among other things, the nursing homes complain that they would bear the brunt of the financial hit when someone is deemed ineligible for Medicaid after moving into their facilities (and could be put in the uncomfortable position of removing some of those patients).

But one healthcare lobbyist familiar with behind-the-scenes lobbying activity said the moderate members and the nursing homes are not working together.

The Pharmaceutical Research and Manufacturers of America (PhRMA), one of the most powerful voices in the healthcare industry, has been uncharacteristically quiet on the budget-reconciliation bill, healthcare lobbyists observed.

Although PhRMA’s members stand to lose money from the prescription-drug payment reforms in the House bill, the group seems to be saving its strength for bigger fights, such as the one in store when the Prescription Drug User Fee Act expires next year. The 1992 law and its 1997 and 2002 offspring were designed to accelerate drug approvals and are seen by many as a vital reason for the industry’s market successes.

PhRMA also has been busy working to fight back efforts by Democrats and some fiscally conservative Republicans to postpone or change the Medicare prescription-drug benefit set to debut in January.

The retail-pharmacy industry, led by the National Association of Chain Drug Stores (NACDS), has been considerably more strident in its public opposition to changes in prescription-drug reimbursement that it contends will underpay the pharmacists who dispense the medicines.

The NACDS’s approach last week was markedly more low-key compared to the onslaught of press releases, statements and advertisements it issued when the House and Senate committees and the Senate as a whole were considering versions of the budget-reconciliation bill in recent months.