Tuesday, May 02, 2017

Through the Revolving Door, Darkly

While the rare appointments to top health care positions by the Trump administration deservedly get considerable media coverage, lower level appointments sneaking through the revolving door do not.  So we hereby present our latest roundup of same, in chronological order by first coverage.

Lance Leggitt from Health Care Lobbyist at Baker Donelson to Chief of Staff for the Secretary of Health and Human Services

This appointment first appeared in StatPlus on March 2, 2017 but was behind a paywall.  It was more recently covered in the New York Times in a long article about revolving door appointments not specific to health care.  From the Times,

Lance Leggitt, who serves as chief of staff to Tom Price, the health and human services secretary, worked last year as a lobbyist for 10 different health care companies, including United States Medical Supply and Advanced Infusion Services. He focused largely on lobbying the agency related to Medicare billing rules, as well as rules for health care supplier accreditations, lobbying disclosure reports show. All these issues are routinely handled by the agency he helps oversee.

Note that a lobbyist for many large health care corporations would now be next door to the leader of government policy on health care. 

Makan Delrahim from Lobbyist at Brownstein Hyatt Farber Schreck to Assistant Attorney General for Anti-Trust

This was first reported by Reuters on March 17, 2017, and has health implications beyond the headline above,

Before coming to work at the White House following Trump's inauguration in January, Delrahim was a lobbyist with the law firm Brownstein Hyatt Farber Schreck, LLP.


Another client in 2016 was health insurer Anthem Inc, which this year lost a court fight with the Justice Department over whether it would be allowed to merge with rival Cigna. Anthem is appealing the loss.

In addition, per David Sirota, writing in the International Business Times,

Makan Delrahim served as one of the healthcare conglomerate’s top lobbyists working on antitrust issues as the company pushed the Justice Department to approve its controversial proposal to merge with Cigna.

Delrahim would head the office that Anthem is pushing to approve the merger, which physicians and consumer groups say could raise healthcare prices and reduce medical coverage for up to 53 million Americans.


According to federal lobbying records, Anthem paid $370,000 in lobbying fees to Delrahim’s firm, Brownstein Farber, between 2015 and 2016. Those fees paid for the lobbying services of Delrahim and William Moschella. Delrahim had previously served in the Justice Department’s antitrust unit under George W. Bush, and Moschella was also a top Justice Department official during Bush’s presidency. The lobbying records said Delrahim and Moschella were working on 'antitrust issues associated with Anthem's proposed acquisition of Cigna.' Lobbying records show Delrahim has also lobbied on antitrust issues for Pfizer, Qualcomm, Ardent Health Services and WMG Acquisitions.

Delrahim was last listed as an Anthem lobbyist five months ago. He is currently serving as President Donald Trump’s deputy White House counsel.

News of Delrahim’s appointment to the nation’s top antitrust job comes weeks after Anthem lawyers told a Delaware judge that they are relying on the Trump administration to settle the antitrust division’s current lawsuit blocking its Cigna merger. Between those court statements and Delrahim’s appointment, President Trump had a personal telephone call with Anthem’s CEO, Joseph Swedish. Anthem gave $100,000 to Trump’s inaugural committee, and after Trump assumed office, the Securities and Exchange Commission helped Anthem quash a shareholder resolution designed to force it to disclose its lobbying expenditures.
Note that Mr Delrahim has worked to promote consolidation of already large health care corporations, yet now would be charged with regulating such consolidation.

John Bardis from MedAssets CEO to Assistant Secretary of Health and Human Services for Administration

This first appeared in Modern Healthcare on March 22, 2017,

John Bardis, the founder and former CEO of MedAssets, has been named HHS assistant secretary for administration.

Alpharetta, Ga.-based MedAssets was a publicly traded group purchasing and revenue-cycle management company. Bardis founded it in 1999 and grew it into one of the largest healthcare group purchasing organizations. He oversaw the firm's diversification into other areas, like revenue-cycle services, for hospital and health system clients.

Bardis stepped down as CEO of MedAssets in early 2015.

 Note that most recently Mr Bardis was the CEO of a health care financial firm and thus was responsible for that company's financial fortunes.  While he has previous experience running other health care related companies, he seems to have no direct experience in health care or public health, per his official biography.

A Prelle Pfuelle from Lobbyist for the Mining Industry to Occupational Safety and Health Administration Administrator

This first and only appeared so far in the Managed Care Matters blog on April 2, 2017,

The Trump Administration’s pick to lead OSHA will push the President’s deregulation agenda far and deep as he shifts OSHA to a more 'business friendly' focus. According to Administrator-designee A. Prelle Pfuelle, the watchword will be 'compliance assistance' instead of enforcement.

Reports indicate the new Administrator, a former lobbyist for the mining industry, will provide 'leadership to curtail funding for enforcement, rescind rules under deregulatory orders, and drop defense of regulations facing legal challenges.' The mining industry has been actively applauding initial moves by President Trump to revoke, rescind, or withdraw several regulations and enforcement actions; Pfuelle may have been instrumental in those early actions.

Pfuelle’s past experience includes stints working as a manager in a diamond mining firm in South Africa, labor relations in Liberia’s oil industry, workplace safety officer in the Pakistani ship-breaking association and most recently lobbyist for the Oklahoma natural gas industry.

 Note that while the OSHA mission is to protect the health and safety of workers, this appointee's past work has involved the financial interests of the mining industry.  Health and safety protections may cost this industry money.  Furthermore, the article suggests that the appointee may be more "friendly" and sympathetic to corporations that employee workers than to to the workers whose health and safety he ostensibly would be protecting.  Note further that he seems to have no experience in public health or health care.

Brett Giroir from CEO of VibraCyte to Assistant Secretary of Health and Human Services

This was first reported by the Bryan (TX) Eagle on April 25, 2017,

President Donald Trump intends to nominate the former executive vice president and CEO of Texas A&M’s Health Science Center to a U.S. Department of Health and Human Services leadership position, according to a White House announcement.

Brett Giroir, who currently serves as president and CEO of biopharmaceutical company ViraCyte and as an adjunct professor at the Baylor College of Medicine in Houston, would serve as assistant secretary of health for the department.
 Note that Dr Giroir is currently responsible for the financial health of a biotechnology company.  He is however, unlike many of these other appointments, a physician.


When we started Health Care Renewal, the topic of conflicts of interest in health care got little attention in the media or in the medical and health care literature.  The topic of health care corruption was virtually taboo.  Through the years these topics have become somewhat more prominent.  But it took the Trump campaign and then the Trump transition and administration to really put them in the headlines.

So, for example, up to now we did not much discuss the amazing collection of conflicts of interest affecting the Trump administration's pick for leadership of the US Food and Drug Administration, Dr Scott Gottlieb.  His case has been well covered since he was named the nominee.  For example, the NY Times article noted above included:

 Dr. Scott Gottlieb, the nominee to lead the Food and Drug Administration, received more than $350,000 in payments in 2014 and 2015 from nearly a dozen different pharmaceutical companies, including Vertex Pharmaceuticals, whose two approved drugs are seen as breakthrough treatments for cystic fibrosis. (They carry list prices of more than $250,000 a year.) Dr. Gottlieb, who has never been registered as a lobbyist but has served as the director of eight pharmaceutical companies and one laboratory company, wrote in a letter that he was prepared to recuse himself as necessary to avoid any conflicts.

I should note that we have discussed previous examples, in 2007 and 2008 (look here, here, here and here), of Dr Gottlieb's strident promotion of the interests of pharmaceutical and biotechnology companies.  After 2008, I though we thought further discussion of this topic would be redundant.  Who would have thought that Dr Gottlieb, such a noisy champion of pharma and biotech, would be a nominee to run the FDA in 2017?  Whou would have thought.... 

But now headlines about conflicts of interest and corruption are so frequent that the less vivid but still important cases, as those discussed above, may get lost in the shuffle.  So the case of Dr Gottlieb is just the most prominent example of how the latest administration has set the revolving door spinning.  (See also previous posts here, here, and here.) 

As we noted previously, the revolving door is a species of conflict of interest. Worse, some experts have suggested that the revolving door is in fact corruption.  As we noted here, the experts from the distinguished European anti-corruption group U4 wrote,

The literature makes clear that the revolving door process is a source of valuable political connections for private firms. But it generates corruption risks and has strong distortionary effects on the economy, especially when this power is concentrated within a few firms.
The ongoing parade of people transiting the revolving door from industry to the Trump administration once again suggests how the revolving door may enable certain of those with private vested interests to have excess influence, way beyond that of ordinary citizens, on how the government works, and that the country is still increasingly being run by a cozy group of insiders with ties to both government and industry. The latest cohort of revolving door transits suggests that regulatory capture is likely to become much worse in the near future.

So, as we have said before.... The continuing egregiousness of the revolving door in health care shows how health care leadership can play mutually beneficial games, regardless of the their effects on patients' and the public's health.  Once again, true health care reform would cut the ties between government and corporate leaders and their cronies that have lead to government of, for and by corporate executives rather than the people at large.

1 comment:

Anonymous said...

Well, Trump is getting rid of lobbyists. He's making them government employees.