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HCFA CANDIDATE WILENSKY HAS KEY POLITICAL TIES, POLICY ANALYSIS TRAINING, BUT LIMITED ADMINISTRATIVE EXPERIENCE: SULLIVAN FORWARDS NOMINATION AUG. 15

Executive Summary

HHS Secretary Sullivan's choice for the post of the Health Care Financing Administration chief is Gail Wilensky, currently is a vice president/policy analyst with the Washington, D.C. health think tank, Project HOPE. Wilensky, 46, has over 15 years of experience in the Washington health policy community. She has held advisory positions on a wide variety of government health funding projects -- including catastrophic health care and the outpatient drug benefit. Her administrative experience as the director of a major bureaucracy, however, is more limited. Her think tank duties have included some management duties, such as the supervision of project teams and the preparation of contract reports [EDITORS' NOTE: For a brief summary of Wilensky's career, see box on next page]. At HCFA, she will sit atop a department with more than 4,000 employees, annual Medicare reimbursements in excess of $ 90 bil. and claims processing contracts of more than $ 1 bil. Administration officials in interviews with Wilensky have questioned her about her management experience. She notes that during a three-year stint at the National Center for Health Services Research, she oversaw operations with a budget of $ 22 mil. She also points out that the HCFA administrator directly supervises only small number of employees. Wilensky has one of the prerequisites for the HCFA post: experience testifying before Congressional committees and a knowledge of the interests and tactics of Hill committees. A brief description of her duties at Project HOPE notes that she "has testified before Congress on many occasions." Her resume lists several appearances before retreat sessions of Congressional committees -- such as a Williamsburg, Va. retreat for the House Ways and Means Committee in March 1987 on the topic of "The Future of the Employer as the Provider of Major Fringe Benefits." Secretary Sullivan forwarded his choice for the HCFA post in an Aug. 15 recommendation to the White House. The recommendation will undergo further review before a formal nomination is made, but HHS officials expect a quick turn-around from the White House. Wilensky's nomination then must be reviewed by the Senate Finance Committee and the full Senate. The Senate Labor & Human Resources Committee could request a chance for a preconfirmation session also. While widely experienced on a variety of health reimbursement and policy topics, Wilensky has built a reputation as a policy analyst, rather than a policy advisor or advocate of specific positions. She is uniformly described as expert, credible, objective and not given to backing quick solutions to health care problems. As a veteran of the Washington cost estimate wars, she should be well prepared for the frequent HCFA disputes with the Office of Management & Budget and the Congressional Budget Office over projected program costs. A number of Washington health care groups hailed her selection as bringing to HCFA an administrator with whom they can negotiate. Wilensky is well-known by most of the Washington health establishment. She has been a frequent contractor and speaker to a number of those groups, but she has never been on the staff of a trade association. During the development of the outpatient drug benefit program, for example, she worked on several analyses of the costs of the benefit for the Pharmaceutical Manufacturers Association. One irony of her appointment is that her analyses of the cost of the outpatient drug program for PMA were often cited by the drug industry in arguments against the benefit. HCFA itself was an opponent of the drug benefit during the legislative development of the catastrophic coverage program. Wilensky's technical analyses for both HHS and private groups on the current hot topic in the HCFA arena -- Medicare catastrophic care coverage -- will shorten her learning period at HCFA. Her research also includes two other topical issues -- physician payment reform and health coverage for the uninsured. In addition to her six-year career with Project HOPE, Wilensky's background has included stints as a researcher at the HHS National Center for Health Services Research and Urban Institute, and academic positions at the George Washington University and University of Michigan. Wilensky is a registered Republican but has not held any party positions nor publicly campaigned for individual candidates. However, she did provide technical expertise on health issues to the Bush presidential campaign. However, Wilensky has strong ties with the Republican health establishment. The head of Project HOPE, William Walsh, is a prominent figure in that group and was an early advisor to the first Reagan campaign and administration. He also was one of the Washington insiders who informally helped to show Sullivan the ropes when the Morehouse medical school dean was appointed HHS secretary earlier this year. Illustrative of her reputation on both sides of the aisle in Congress, Wilensky has made presentations to policy retreats held by both Republican and Democratic members of the House Ways and Means Committee as well as to meetings of the House Wednesday Group, an invitation-only Republican policy study group chaired by Rep. Gradison (Ohio). Wilensky has served on various federal advisory commissions, including the Physician Payment Review Commission. Most recently, she was asked to provide data analysis to the Advisory Council on Social Security, which is chaired by Deborah Steelman, the chief domestic policy advisor to the Bush presidential campaign. Although Wilensky's name has appeared on White House "short lists" previously, her candidacy has not been pushed by any one industry group or senator. Some of the previous candidates were directly linked to influential sponsors. The lack of a policy trail or affiliation could smooth the nomination and approval process. New Jersey Medicaid Commissioner Drew Altman, Sullivan's previous choice, withdrew in part because his reputation as a regulator and as a moderate-to-liberal Republican drew opposition from health care provider groups, White House officials and Senate conservatives. Wilensky also can avoid the problem faced by the first almost-nominee, Sheila Burke, chief of staff to Senate Minority Leader Robert Dole (Kan.). Burke withdrew due to concerns about conflicts of interest with her husband, a top exec at Aetna. Aetna is a recipient of HCFA contracts. Wilensky's husband is a private physician practicing in the Washington, D.C. area. Chart omitted.
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