WASHINGTON -- Not since the Tax Reform Act of 1986 has one bill done so much for so many lobbyists. It's probably no surprise that health care reform has turned into a massive boondoggle this year for anyone representing any special interest even remotely tied to the health care industry. But what some may not realize is that the legislation could Keep lobbyists in fat city for some time to come.
As originally proposed by President Clinton, health care reform would guarantee insurance coverage to all Americans -- but not until 1998. That so-called universal coverage would be paid for by a controversial plan requiring employers to pick up the tab.
The employer-mandate provision has become such a political hot potato that congressional leaders have recently been talking about delaying its effective date. They can't jettison the mandate completely, or they would have to cast about for another big revenue raiser. But by delaying the employer mandate, they could buy a little time and at least get past the 1996 presidential election before the pain from that provision would be felt.
Putting off the employer mandate would, in turn, probably mean that the 1998 starting date for universal coverage would have to be pushed back as well. Enacting a bill this year but making two key provisions effective down the road leaves a lot of opportunity for fiddling with the new law in the intervening years.
So the delay would make health care reform "the full employment bill for health care lobbyists," said one Capitol Hill watcher.
"I'll bet there are law firms celebrating,'' said this source, herself a lobbyist, who admitted her comments sounded somewhat cynical. "No matter what happens, they're going to be popping those champagne corks. They'll have clients forever."
But the goodies won't flow only to lobbyists, she pointed out. Delaying the start of health care reforms also means "a steady stream of election contributions" for lawmakers involved in those issues, she said.
There are plenty of precedents for bills that cause Congress to drag its feet and end up, albeit inadvertently, lining the pockets of lobbyists. None is more obvious than the Tax Reform Act of 1986.
Within that act, there were a whole host of tax breaks that Congress deferred decisions on, including the tax exemptions for .mortgage revenue bonds and small-issue industrial development bonds.
In the 1986 act, Congress declared that the mortgage bond exemption would terminate in 1988 and the IDB exemption would end in 1989. Others had similar expiration dates: the low-income housing tax credit, the targeted jobs tax credit, the research and development tax credit, and so on and so on.
Did any of those tax breaks expire on schedule? Not a one. For several more years, Congress kept granting them temporary extensions. Many members of Congress called for decisions to be made once and for all as to which tax breaks should be kept and which should be allowed to die.
But Congress never seemed to be willing to bite the bullet and make the tough decisions. Many Capitol Hill watchers attributed the foot-dragging to a desire by lawmakers to keep the campaign contributions rolling in from interested parties. A number of legislators admitted as much. And some lobbyists even conceded they would be sorry to see their favorite expiring provisions be made permanent, because it would be bad for business.
Last year, Congress did finally grant permanent extensions to a number of those tax breaks, including the mortgage bond and IDB exemptions and the low-income housing credit.
But now, just as those opportunities for money-making, Washington style, are disappearing, health care reform looms on the horizon as a brand new extended income machine.
"It's no longer tax issues now. It's health care," said that cynical lobbyist. "You look at the money that's rolling in."
