Senate Panel Affirms Sebelius to Lead HHS

Kansas Gov. Kathleen Sebelius' nomination to serve as secretary of the U.S. Department of Health and Human Services moves to the full U.S. Senate, as the Senate Finance Committee approved the former state insurance commissioner in a 15-8 vote.

Named in early March as President Barack Obama's choice to serve the key oversight position for the administration's planned overhaul of the U.S. health care system, Sebelius earned yea votes from Republican committee members Sens. Olympia Snowe, R-Maine, and Pat Roberts, R-Kan., in addition to the panel's Democrats.

However, her nomination could still face challenges on the Senate floor, including a potential filibuster. Several GOP senators have raised concerns about Sebelius' tax compliance and alleged under-reporting of donations to her 1994 and 2001 insurance commissioner campaigns by a doctor who performed abortions. Senate Minority Whip Jon Kyl, R-Ariz. -- who voted against the nomination as a member of the committee -- also has taken issue with the governor's stance on "comparative effectiveness" research, a notion supported strongly by the Blue Cross Blue Shield Association.

"I believe in the right of every American to choose the doctor, hospital, and health plan of his or her choice. No Washington bureaucrat should interfere with that right or substitute the government?s judgment for that of a physician," Kyl said in a statement. "I will oppose Gov. Sebelius' nomination because of her insufficient commitment to these principles."

Sebelius served two terms as Kansas' insurance commissioner from 1995-2002, becoming the first Democrat elected to the post in more than a century. She served as president of the National Association of Insurance Commissioners in 2001, the same year she moved to block the for-profit conversion of Blue Cross Blue Shield of Kansas when Indiana-based Anthem proposed to acquire the company.

The governor is Obama's second pick for the post, which provides oversight to the Centers for Medicare & Medicaid Services, National Institutes of Health and the Food and Drug Administration, among other agencies. Former Senate Majority Leader Tom Daschle withdrew his nomination last month amidst questions about unpaid taxes, an issue that also has plagued several other Obama nominees.

Unlike Daschle, Sebelius is not being proposed to serve as head of the newly created White House Office of Health Reform. Obama separately named Nancy-Ann DeParle, former administrator of CMS' predecessor agency during the Clinton administration, to that post. DeParle's nomination did not require Senate confirmation.

In February, Obama unveiled an administration budget that would create a $634 billion health care reserve fund over 10 years, financed by a variety of tax increases and the virtual elimination of the Medicare Advantage program (BestWire, Feb. 26, 2009).

Under Obama's health care reform plan, there would be a federal mandate to purchase coverage for all children, while all but the smallest employers would face a "pay-or-play" requirement, in which they either provide minimum creditable coverage to their employees, or pay into a national pool. Subsidies would be offered to lower-income individuals purchasing through a National Health Insurance Exchange, and policies would have to meet federal mandates, with a minimum loss ratio. Guaranteed issue and community rating laws would be expanded nationwide, and a basic government-provided plan also would be available for all through the NHIE.

(By R.J. Lehmann, Washington bureau manager: raymond.lehmann@ambest.com)