2012 Election Overview and Implications for the O&P Profession

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The Washington DC political environment changed only slightly as a result of the 2012 national elections, despite a lengthy campaign season that resulted in unprecedented political spending over the past two years. President Barack Obama won reelection, the Democrats remain the majority party in the Senate, adding two seats, and Republicans continue to lead the U.S. House of Representatives as the majority party. As a result, despite a fairly convincing win by President Obama and his Democratic allies in Congress, in the context of a divided country, the end result is pretty much the status quo.

Thomas

However, the election provides the president and Congress the opportunity to "reset" the debate surrounding a number of issues critical to the future of our country. Over the next few weeks and well into 2013, Congress will attempt to address many of the significant financial issues commonly referred to as the "fiscal cliff," including automatic cuts to spending (i.e., sequestration) scheduled to begin on January 1; the expiration of favorable tax provisions including the payroll tax, the Bush-era income-tax rates, and the current treatment of the Alternative Minimum Tax (AMT); and the need to again increase the federal debt limit in early 2013.

The results of this election and the compromises to be reached over the next few months will have far-reaching implications for the O&P profession. Congress will undoubtedly continue to debate entitlement reform to find ways to reduce federal expenditures for these programs. But the election results lessen the likelihood of converting the Medicare entitlement into a partially private system (commonly referred to as a voucher program) and to turn Medicaid into block grants. Nonetheless, both programs will continue to be at risk of additional spending cuts in the context of resolving the fiscal cliff.

President Obama's reelection means the Affordable Care Act (ACA) will continue to be implemented over the next four years, although implementation of the state insurance exchanges and federal subsidies to purchase insurance may be delayed as Congress debates ways to trim federal spending in the coming months. Conversely, the Administration has indicated that it plans to implement as many of the reform measures as quickly as possible on the assumption that the public will support health reform once the key provisions begin to take effect. The fate of the Medicaid expansion under the ACA will continue to remain ambiguous, as federal savings could be achieved by delaying the expansion and states assess the practicalities of expanding the program now that the election politics have subsided.

Congressional Race Results and the O&P Legislative Agenda


U.S. Senate

Thirty-three Senate seats were contested in this election, 21 of which were held by Democrats, ten by Republicans, and two by independents. The results constitute the strongest electoral showing for Senate Democrats in decades. Returns show that Democrats gained two seats, bringing them to 53 seats in the Senate (55 if both independents align with the Democrats). Republicans lost two seats, with the current tally showing they have 45 seats in the Senate. A total of 12 senators will be leaving Washington DC due to retirement or loss of primary or general elections.

A notable loss for the O&P community is the Senate race in Nebraska, where former senator and governor Bob Kerrey, a Democrat, Vietnam veteran, and lower-limb amputee, was not able to overcome his Republican opponent, Deb Fischer. Kerrey was a proven champion for the O&P community when he last served in the Senate ten years ago.

Senator Ron Wyden (D-OR), the sponsor of the Medicare Orthotics and Prosthetics Improvement Act, is in the middle of his fourth term as senator and will remain the profession's Senate champion on this important legislation. Senator Olympia Snowe (R-ME), however, decided to retire from the Senate, citing gridlock and partisanship as her main reasons for leaving. Snowe is currently a Republican co-sponsor of the Medicare O&P Improvement Act and the lead sponsor of the Insurance Fairness for Amputees Act. Her Maine Senate seat will be taken by independent Angus King.

Senator Kent Conrad (D-ND) is also retiring from the Senate, leaving open the chair of the Senate Committee on Budget and the chair of the Subcommittee on Taxation and Internal Revenue Service (IRS) Oversight. Senator Herb Kohl (D-WI) is also retiring. He currently serves as the chair of the Senate Special Committee on Aging, which does not have legislative authority but has engaged in Medicare and Medicaid issues for years. Both of these important committees will receive new leadership in the 113th Congress.

U.S. House of Representatives

Seventy-three members of the House will leave due to primary or general election losses or retirement. Prior to the election, Republicans held 241 seats in the House, Democrats held 192 seats, and there were two vacant seats. Republicans now hold 234 seats and Democrats have 201 seats. One seat remains undecided.

Notable races for the O&P community include a win in Illinois by Tammy Duckworth (D), a former Iraq War veteran with bilateral, lower-limb amputations, who is expected to be a champion of O&P and disability issues. Representative Pete Stark (D-CA), a 39-year senior Democrat, lost his reelection bid, opening up the ranking member seat for the House Committee on Ways and Means Subcommittee on Health. The current chairman of this same subcommittee, Congressman Wally Herger (R-CA), retired. This means that new leadership on both sides of the aisle will take positions on the Health Subcommittee, which has primary jurisdiction over Medicare Part A and shares jurisdiction over the rest of the Medicare program, including O&P Medicare policy.

Other races of note include Representative Bill Pascrell (D-NJ), who won reelection and will remain chair of the Congressional Brain Injury Task Force. He is also expected to retain his seats on the Committee on Ways and Means Subcommittee on Health and the House Budget Committee. Finally, Representative Jim Langevin (D-RI), co-chair of the House Bipartisan Disabilities Caucus and the only member of Congress with quadriplegia, successfully defended his seat and is expected to continue his leadership on disability and rehabilitation issues.

O&P Care under Healthcare Reform

The reelection of President Obama makes clear that the ACA will be implemented rather than being repealed. Over the next few months, the U.S. Department of Health and Human Services (HHS) will continue to issue a series of regulations and guidance. Recently, HHS released a series of regulations that will impact insurance coverage of O&P care in a variety of ways. The regulations address how states are to determine the contents of essential health benefits (EHB) packages, prohibit insurance companies from discriminating against individuals with pre-existing or chronic conditions, and set guidelines for developing workplace wellness programs.

The ten essential benefit categories listed in the ACA itself are very broad and do not detail specific treatments or devices; nor does the statute address the amount, duration, or scope of benefits covered. The proposed rules issued recently by HHS included detailed guidance to help states define the essential benefits categories. States are currently selecting and submitting "benchmark" plans to serve as EHB packages starting in 2014 to the HHS for approval. O&P advocates must continue to work to ensure that these state-based EHB plans are in compliance with the ACA. In particular, the O&P community must ensure that the ACA's benefit category of "rehabilitative and habilitative services and devices" is defined to include O&P care. This is the term used by Congress to convey their intention to cover, among other things, orthotics and prosthetics. Although the term "orthotics and prosthetics" is not specifically mentioned in the statute itself, there is strong legislative history that indicates that Congress intended orthotics and prosthetics to be covered under this benefit category.

Conclusion

The O&P profession can expect that Congress and the Administration will resume budget deficit negotiations after the election with renewed vigor. Compromises necessary to achieve federal savings will include changes to programs critical to the O&P community, particularly Medicare and Medicaid. At the same time, delivery reforms and insurance coverage reforms under the ACA will continue to be implemented, opening up new opportunities for patients and the providers who serve them.

Peter W. Thomas, JD, is general counsel for the National Association for the Advancement of Orthotics and Prosthetics (NAAOP). Theresa T. Morgan is the legislative director at Powers Pyles Sutter & Verville PC.

Impact on Potential O&P Legislation

  • Injured and Amputee Veterans Bill of Rights:
    Representative Bob Filner (D-CA), sponsor of the Injured and Amputee Veterans Bill of Rights, H.R. 805, retired from his seat, leaving open the ranking member position for the House Committee on Veterans' Affairs (VA). The bill also lost six of its 11 co-sponsors including Stark, Leonard Boswell (D-IA), Mike Ross (D-AR), Dan Boren (D-OK), Charles Gonzalez (D-TX), and Brad Miller (D-NC). New York State Representative Ann Marie Buerkle (R), current chair of the House VA Health Subcommittee, lost her race. Buerkle was the driving force behind recent hearings in the House on VA prosthetic care. How the losses of Buerkle and Filner will impact the O&P agenda on VA issues remains to be seen, but it is clear the O&P community will have to work hard to rebuild Congressional support.
  • Medicare Orthotics and Prosthetics Improvement Act:
    Congresswoman Shelley Berkley (R-NV) retired from her House seat to run for Senate, but was defeated. Berkley is currently the lead House sponsor of the Medicare O&P Improvement Act. Of the bill's nine cosponsors, Jason Altmire (D-PA) lost to his opponent in the primary, Boswell was defeated in the general election, and Ross retired. Ross' seat was won by 35-year-old Tom Cotton (R), a Harvard Law School, Cambridge, Massachusetts, graduate and a veteran of the Iraq and Afghanistan wars. The O&P community will also have to rebuild support for this legislation in the 113th Congress.
  • Insurance Fairness for Amputees Act:
    Representative Charles Dent (R-PA), who introduced the Insurance Fairness for Amputees Act in the House, was reelected and will presumably continue as the champion of this legislation. In light of the likelihood that President Obama will press for full implementation of the ACA in his second term, the O&P community will have to assess the current version of the Fairness Act to see whether changes will be necessary if and when a new bill is introduced in the 113th Congress.

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