Washington lobbying giants cash in on health reform debate

Introduction

While patients, taxpayers and lawmakers debate the impact of the health care reform law President Obama signed on Tuesday, one result of the epic battle is clear: a bonanza for K Street.

And among lobby firms that worked the issue, the richest generally got richer. A Center for Public Integrity ranking of the top dozen with the most clients involved in health care last year reveals a host of high-profile Washington concerns — companies like Patton Boggs LLP, Alston & Bird, LLP, Holland & Knight LLP and the Podesta Group.

About 1,750 businesses and organizations spent at least $1.2 billion in 2009 on lobbying teams to work on health reform and other issues, according to a Center analysis of Senate lobby disclosure documents. Since lobbyists are not required to itemize the amount spent on each issue, the precise amount that went to health reform remains unknown. But if only 10 percent of that lobby spending went toward health reform, the amount would total $120 million – and that’s likely a record for a single year’s spending on a particular issue, experts say.

The clients who hired these firms ranged from the most influential industry associations to small non-profit advocacy groups. Many companies and organizations hired more than one of the top firms to lobby its interests. Pharmaceutical Research and Manufacturers of America, for example, hired Capital Tax Partners LLP, Dutko Worldwide, Mehlman Vogel Castagnetti, Inc. and 22 other outside firms, in addition to its in-house lobbyists. Wal-Mart Stores Inc. hired Patton Boggs LLP, Podesta Group Inc, Mehlman Vogel Castagnetti, Inc, and Bryan Cave LLP. Narrative continues beneath chart.

The Top Twelve

Below are the top 12 firms, based on the number of clients they represented on health reform in 2009. However, the total dollar amounts listed for contracts may include lobbying on multiple issues beyond health care reform. The disclosure documents analyzed by the Center included “health reform” or similar wording but lobbyists are not required to delineate how much money in a given contract is devoted to a specific issue.

No. 1: Patton Boggs LLP

• 53 clients
• How much clients spent on health care and other issues in 2009: $7,675,000
• Washington’s biggest lobby firm, Patton Boggs represented Wal-Mart Stores Inc., Florida’s Pinellas County, and Bristol-Myers Squibb Co.
• Founded in 1962, the law firm’s current chairman, Thomas Hale Boggs, Jr., is the son of former House Majority Leader Thomas Hale Boggs, Sr.

No. 2: Alston & Bird LLP

• 40 clients
• How much clients spent on health care and other issues in 2009: $4,610,000
• The Atlanta-based firm represented Aetna Inc., Verizon Communications Inc., and Safeway Inc.
• A 900-lawyer firm, its partners have included golfer Bobby Jones, former Senate Majority Leader Bob Dole, and Neal Batson, who was appointed examiner for bankrupt Enron Corp.

No. 3: Foley Hoag LLP

• 32 clients
• How much clients spent on health care and other issues in 2009: $4,064,500
• Represented mainly pharmaceutical companies including Pfizer Inc., Eli Lilly & Co., Merck & Co., and Amgen Inc.
• Founded in 1943, the firm has nearly 225 lawyers; antitrust, corporate, and intellectual property work have been recognized as strengths.

No. 4 (Tie): Podesta Group Inc.

• 28 clients
• How much clients spent on health care and other issues in 2009: $5,160,000
• Represented a diverse group of medical and other interests, including Davita Inc, Novartis AG and Nestle USA.
• Chairman Tony Podesta was one of two lobbyists on GQ’s 2009 list of the 50 most influential people in Washington. His brother, John Podesta, was President Bill Clinton’s chief of staff, and created the think tank Center for American Progress.

No. 4 (Tie): Capitol Tax Partners LLP

• 28 clients
• How much clients spent on health care and other issues in 2009: $3,640,000
• Represented Time Warner Inc., Kraft Foods Inc., and Delta Air Lines Inc.
• A consulting firm, Capitol Tax focuses on tax policy and regulatory issues and says it offers clients “an intimate, first-hand knowledge of the tax-writing committees and the Treasury.”

No. 4 (Tie): Holland & Knight LLP

• 28 clients
• How much clients spent on health care and other issues in 2009: $2,840,000
• Clients included the Association of Critical Care Transport, Health First Inc., and the Florida Hospital Association.
• The 1,150-member law firm has offices in a dozen U.S. cities, China, Israel, Mexico, UAE, and Venezuela.

No. 5 (Tie): Dutko Worldwide LLC

• 25 clients
• How much clients spent on health care and other issues in 2009: $3,740,000
• Represented, among others, insurer United Health Group, drugmaker association PhRMA, and medical device firm Medtronic Inc.
• A lobbying and public affairs firm, Dutko has offices in 10 U.S. and European cities. The company was acquired last November by London-based Huntsworth Plc, which also focuses on health care issues.

No. 5 (Tie): Drinker Biddle & Reath LLP

• 25 clients
• How much clients spent on health care and other issues in 2009: $1,950,000
• Represented National Psoriasis Foundation, National Association of County and City Health Officials, and American Association of Bioanalytics.
• With 700 lawyers in a dozen U.S. offices, the firm’s clients are concentrated among health care providers, pharmaceutical firms, asset managers, and transportation industries.

No. 6: Mehlman Vogel Castagnetti Inc.

• 24 clients
• How much clients spent on health care and other issues in 2009: $3,490,000
• Represented Mayo Clinic, Merck & Co Inc., and Hewlett-Packard Co.
• The government affairs firm was founded by Bruce Mehlman, former general counsel to the House Republican Conference; Alex Vogel, former chief counsel to then-Senate Majority Leader Bill Frist; and David Castagnetti, a senior strategist in John Kerry’s presidential campaign.

No. 7 (Tie): Sonnenschein Nath & Rosenthal LLP

• 23 clients
• How much clients spent on health care and other issues in 2009: $2,620,000
• Represented mostly health care clients, including California Association of Physician Groups, Lance Armstrong Foundation, and Dynavox Inc.
• A century-old law firm, it has more than 700 lawyers in offices throughout the United States and Europe.

No. 7 (Tie): Bryan Cave LLP

• 23 clients
• How much clients spent on health care and other issues in 2009: $2,240,000
• Represented Blue Shield of California Life and Health Insurance Co., Puerto Rico Federal Affairs Administration, AstraZeneca Pharmaceuticals LP, and American Academy of Family Physicians.
• The firm has more than 1,000 lawyers in offices worldwide.

No. 7 (Tie): Van Scoyoc Associates

• 23 clients
• Represented health care interests and colleges, including University of Alabama System and University of Connecticut.
• How much clients spent on health care and other issues in 2009: $1,630,000
• Founded in 1990, the Washington-based government affairs firm began as a specialist in tax and appropriations issues and has since expanded to more than 20 areas ranging from agriculture to water policy.

Financial industry lobbyists have so far won few large victories during the reform debate, but the battle has boosted K Street balance sheets already plump from the extended skirmish over health reform.

From former congressional aides to former agency heads, the firms unleashed highly connected lobbyists to push their clients’ agendas, including Thomas Scully, a former administrator of the Centers for Medicare and Medicaid Services under President George W. Bush, and Colette Desmarais, a former top health policy aide to Republican Sen. Charles Grassley. Scully is now a lobbyist with Alston & Bird LLP and Desmarais works for Mehlman Vogel Castagnetti, Inc.

Paul Kim, a partner at Foley Hoag LLP — the only health lobbyist willing to speak to the Center on the record — downplayed the importance of personal connections with Congress and agency staff. Knowledge of the issues is more important, he said. “I think what we have found is it hasn’t been head count or access, necessarily, that is most important in serving clients,” Kim said.

Pharmaceutical companies, which stand to garner increased profits from the newly insured under the bill, made up the majority of Foley Hoag’s health reform clients. Kim said the lobby work sprang from other legal work the firm does for drug industry. “Foley Hoag is a law firm that is heavily concentrated on the life sciences,” he said.

In addition to direct lobbying, some of the top firms also reward members of Congress with campaign contributions funneled through firm political action committees, and by individual lobbyist donations. The political action committee at Patton Boggs LLP — the biggest lobby firm in Washington — contributed more than $500,000 to candidates during the 2008 cycle, according to Center for Responsive Politics. John Jonas, a top Patton Boggs health lobbyist who declined to be interviewed, donated more than $50,000 during the 2008 cycle, almost exclusively to Democratic candidates.

James Thurber, director of the Center for Congressional and Presidential Studies at American University, said that among the major players there are “no surprises”. But the tremendous financial boost that health reform brought to lobby firms in 2009 was greater than even veteran observers expected. “I think it is unprecedented,” Washington lawyer and lobbying expert Ken Gross said about the amount of money spent on the health reform battle.

The length of the debate, paired with the more than 1,750 business and organizations that signed up to lobby on health reform bills, likely made it the strongest and most expensive lobby push ever, Gross said.

“First of all, it went on for so long,” Gross said. “Second of all, it was high stakes poker. It stands to reason that it would be a record-breaker.”