Rough Rider

x-Wisconsin Gov. Tommy Thompson likes to regale audiences with a tale about his humbling first day in Washington as Health and Human Services secretary. As Thompson tells it, he walked over to admire the grandeur and solemnity of the Capitol building and happened to see Sen. Edward Kennedy, D-Mass., walking toward him.

"I extended my hand, and he extended his, and when I tried to shake his hand he pressed some car keys into my palm and said: 'It's the black Mercedes out in front there,'" Thompson said in a speech earlier this year. "Now when Ted Kennedy thinks you're his driver, you know you've really come onto the scene."

The Mercedes story is apocryphal, of course. Kennedy never mistook Thompson for his driver. But Thompson's fondness for telling the story speaks volumes about how he perceives his new job as HHS secretary. No longer "King Tommy," as he was known for his record 14 years as Wisconsin's chief executive, Thompson now casts himself as a lackey to the big wheels at the White House and on Capitol Hill.

By Thompson's own account, it's been a bumpy ride. In Wisconsin, he won national acclaim for his innovative welfare, health care and education reforms. But Thompson, now 60, has struggled to stay on course since taking the helm of HHS in February 2001. The anthrax crisis, a host of volatile social issues and the sheer politics of life inside the Beltway seem to have caught him off guard. Thompson has won praise for his refreshing candor and take-charge attitude-he rides a Harley in his spare time and boasts that he abhors the status quo. But he's also been dogged by controversy.

Thompson's public statements following last fall's anthrax attacks were widely criticized as clumsy and contradictory. His attempts to impose a top-down management style on the department's sprawling bureaucracy have met with mixed reviews. He's clashed with the White House on issues ranging from stem cells to tobacco regulation. He's struggled to fill top political posts throughout his department. And he's peddling a welfare reform plan-approved in the House but stalled in the Senate-that leaves many governors cold.

Thompson would have a tough job under the best of circumstances. With more than 65,000 employees and a budget of $489 billion, HHS is among the world's largest government entities. Its 300 programs run the gamut from scientific research to food safety, family violence and drug abuse. Each one of its dozen major operating divisions-including the Centers for Disease Control and Prevention, the Food and Drug Administration, the National Institutes of Health-is a bear to administer.

Running the department is "perhaps the consummate management challenge in the federal government," says Robert Moffit, who directs domestic policy studies at the Heritage Foundation, a Washington-based think tank, and who served as a deputy assistant secretary at HHS in the Reagan administration.

For Thompson, that challenge became nightmarish last fall, when the World Trade Center and anthrax attacks thrust bioterrorism front and center. Thompson has largely recovered from his anthrax miscues, installing across the hall from his office a round-the-clock war room to handle bioterrorism. But his task-rebuilding the nation's crumbling and long-neglected public health system-is overwhelming.

Even before Sept. 11, Thompson's hands were full. He took over HHS when virtually every element of the nation's health care system seemed to be reeling toward crisis. Medical costs are soaring; the Medicare system, soon to be overwhelmed by retiring baby boomers, is headed for bankruptcy; and more than 40 million Americans are uninsured. Yet partisan disputes have stalled action on health policy indefinitely.

"Find me somebody that's happy with health care in America right now," says Dr. Richard Roberts, who chairs the American Academy of Family Physicians. "Everybody's frustrated. The cost, the hassle, the questionable quality. It seems we've kind of lost our way in terms of priorities." What Thompson can do, Roberts adds, "is help us begin a national conversation around what it is that we truly need, want and value when it comes to health care."

It's a conversation that may not come naturally to Thompson. The job wasn't even his first choice for a Cabinet post. A former chairman of Amtrak, Thompson had his eye on the Transportation Department. He's developed quite a spiel, in fact, for what a letdown Washington has been. In speeches he describes how as governor, he could come up with an idea in the morning and have people working on it by the afternoon.

In Washington, Thompson's standard preamble goes, an idea has to be vetted by the entire department, then by the "Supergod"-his term for the office of Management and Budget-and by the "young Turks" at the White House. If they approve, it goes to the president, and if the president approves it goes to Congress-at which point, Thompson tells his audiences, "It's time to retire."

It's little wonder that speculation has been rampant that Thompson is not long for this administration. Earlier this year, rumor had it that Thompson had submitted his resignation, and that President Bush had refused to accept it. Predictions of an early departure also were made of Thompson's friend and predecessor, Donna Shalala, who also hailed from Wisconsin. Yet Shalala stuck out the entire Clinton administration and served longer than any HHS secretary.

Recently, Thompson has issued mixed signals on how long he will stick around. At a public appearance in August, he said he had made no commitment to serve more than two years and had received private sector job offers. After the news media picked up on those remarks, Thompson hastily clarified in September that he would stay on through President Bush's four-year term.

Aides say Thompson is content in the position and isn't going anywhere. Thompson told Government Executive: "There's no question that in the first year, I had a very difficult time adjusting. But I've learned to live with the bureaucracy, and I've made a difference, and I'm enjoying it. And I'm going to stay for a while."

A CRITIC TAKES CHARGE

One argument for not stepping down is Thompson's reputation as a fighter. He grew up in small town Wisconsin, polishing eggs and earning a quarter an hour from his father, who ran a grocery store and gas station. Thompson worked his way through college and law school, and at age 24 toppled an incumbent to win a seat in the legislature.

As governor, Thompson was so popular that people called him "Governor for Life." His work-driven welfare reforms reduced caseloads by 90 percent and became a national model. He went on to overhaul the state's health care system with a "BadgerCare" program that made low-income working families eligible for health insurance. If a particular program didn't work, Hefty says, Thompson would simply scrap it and start again.

It's an approach that's been hard to duplicate at HHS. Indeed, much of Thompson's success in Wisconsin was built on throwing out federal rules. He asked for more waivers from federal regulations than any other governor, and chafed at how slowly HHS granted them. In his book Power to the People: An American State at Work (HarperCollins, 1996), he disparaged Washington as "Disneyland East."

Now he's been put in charge of the very agency that used to exasperate him. His instincts as a governor have both helped and hurt. His public speaking skills and his passion for helping people have won praise. He's gone on a diet and challenged all department employees to lose weight. He's embraced prevention as the key to controlling health care costs, launching celebrity and media campaigns to warn Americans about diabetes, smoking and obesity. He's thrown himself into promoting organ donation and fighting breast cancer.

Thompson strikes many as the antithesis of a bureaucrat. "The reaction to him is that he is very open and he's a quick study," says Dick Davidson, president of the American Hospital Association. "He understands very complex issues. And he likes to listen."

But his tendency to micromanage has ruffled feathers. Thompson set out to practically reinvent HHS, telling senior managers bluntly that "if they are not living on the edge, they are taking up too much room." His first target was the agency known until recently as the Health Care Financing Administration, which manages Medicare, Medicaid and the State Children's Health Insurance Program. According to Thomas Scully, the agency's administrator, Thompson told him bluntly on arriving at HHS: "I hate HCFA."

Thompson renamed HCFA the Centers for Medicare and Medicaid Services (CMS) and reorganized it to respond better to beneficiaries and providers. The response time for a written inquiry has been slashed from 80 days to less than 20 days, he brags, and he wants it down to 10 days.

CMS also has rolled out a simpler enrollment form for doctors and has invited providers to a roundtable once a month to hash out ways to ease regulatory burdens. The agency is handing out waivers at a rapid rate, encouraging states to experiment and find ways to cover prescription drugs for Medicare recipients-even as lawmakers on Capitol Hill continue to argue over a federal drug benefit.

But Thompson's "one department" initiative, which will centralize many HHS functions now handled by individual divisions, has been controversial. All public affairs and legislative affairs activities, for example, are being brought under Thompson's watchful eye. The initiative reflects Thompson's sense that HHS was a department verging on managerial chaos when he took over. As he describes it, e-mail systems were separated by floor, hundreds of press and public affairs personnel were scattered from Atlanta to Baltimore, and HHS had no fewer than 2,000 Web sites totaling about a billion pages.

"My top management objective is to build an integrated department-one computer system, one bookkeeping system, and to build an integrated approach to handling the operations of the 300-plus programs to be administered," he told Government Executive.

But some on Capitol Hill fear that consolidating communications and press operations, in particular, will backfire and create bottlenecks.

"I'm concerned about whether or not this will add an additional layer of review by the secretary's office," said Sen. Max Cleland, D-Ga., during an April hearing by the Senate Governmental Affairs Committee. Centralizing communications, Cleland warned, might slow the flow of information from federal health experts to their state and local counterparts-a major problem during the anthrax episode.

Some wonder whether the top-down management style that worked for Thompson as governor is even adaptable to HHS. In contrast to Shalala, whose natural instinct as former chancellor of the University of Wisconsin was to delegate authority, Thompson has "made a lot of moves to get control of things," observes ex-Surgeon General David Satcher. Yet it may not be possible to administer an agency as far-flung as HHS in quite that way, some observers say.

Thompson's instinct for seizing the microphone served him poorly during the anthrax crisis. He overstated U.S. preparedness and speculated that the first anthrax victim may have contracted the illness by drinking from a stream. Members of Congress have since given Thompson an earful on the need to let credible, knowledgeable health officials speak during a crisis.

Thompson, to be sure, has received kudos for setting up an Office of Public Health Preparedness to coordinate and oversee bioterrorism response. Its first director was smallpox vaccine pioneer Dr. D.A. Henderson, who agreed to serve for six months. Thompson later named Jerome Hauer, his adviser for national security and emergency management, to succeed Henderson. Hauer now has been elevated to acting assistant secretary for public health emergency preparedness.

Even Thompson's harshest critics have been impressed with how quickly he's moved federal dollars into the hands of state public health officials. The administration has set aside $1.1 billion to help states respond to terrorism and has asked for another $4.3 billion for fiscal 2003, a 45 percent increase. HHS gave states 20 percent of the initial outlay right away, asking state officials to submit comprehensive plans for how they would strengthen and unify their public health systems. HHS approved those plans in June and will now distribute the remaining 80 percent of the funds.

"I think this is the fastest that money has ever gone from the federal government to the states," says Muhammad Akhter, executive director of the American Public Health Association. Akhter's group has faulted the administration on several fronts, including its failure to fill top HHS vacancies. But Akhter has high praise for Thompson: "He's done more for building public health infrastructure in his first year and a half than many people have done in their entire term."

MISSING PLAYERS

Even Thompson acknowledges, however, that the nation is underprepared for a bioterrorist attack. At the April hearing, Chairman Joseph Lieberman, D-Conn., asked Thompson to rate national preparedness for a bioterror attack on a scale of one to 10. "Once the money is out, I would say we're at six, going on seven," Thompson replied.

The public health system has been neglected for so long that even the administration's substantial investments are a down payment at best, experts say. The nation's hospitals, front-line responders in disasters, remain understaffed and overcrowded. Just equipping hospitals to handle nuclear, biological and chemical emergencies would cost more than $11 billion, according to the American Hospital Association.

Thompson also is hampered by a lack of coordination at the federal level. He is in regular contact with Homeland Security Director Tom Ridge (a fellow former governor) and with the Central Intelligence Agency, Defense Department and Federal Bureau of Investigation. But tensions over who's in charge remain unresolved. It's unclear whether President Bush's plan for a Homeland Security Department, which would absorb some HHS activities, would correct these problems.

Thompson doesn't even have a full team to back him up. The Bush administration entered its second year with no one to lead the CDC, FDA, NIH, or the Health Resources and Services Administration. Dr. Jeffrey Koplan resigned as head of the CDC in March, some speculated because of fallout over the anthrax attacks. And Satcher's term as surgeon general ended on Feb. 13.

Bush has since nominated Arizona trauma surgeon Richard Carmona to replace Satcher, and the Senate recently confirmed Johns Hopkins University radiologist Elias Zerhouni to head NIH. In July, Thompson appointed infectious disease expert Dr. Julie Gerberding to head the CDC. She had been in charge of the agency's counterterrorism efforts.

But Thompson has complained openly about the slow pace of filling vacancies, saying it would never be tolerated in the private sector. Thompson has attempted to move the process along. Last fall he recommended that the White House appoint Lester Crawford, a veterinarian with a doctorate in pharmacology, to be FDA commissioner. But the administration has named Crawford deputy commissioner to run the agency until a permanent FDA chief is found.

Some speculate that the problem lies with ideological litmus tests imposed by the White House, which has waded into one controversy after another, from stem cells to cloning to contraceptives. The selection of who will head top HHS agencies "is clearly not his call," says one health care lobbyist of Thompson.

The vacancies might also be a failure of recruitment. After leaving HHS, Shalala reflected that one of the key lessons she learned about managing a large bureaucracy was the importance of recruiting agency heads who are both team players and world experts in their fields.

"Everyone has trouble appointing people if you don't get most of it done in the first couple of months," she told Government Executive. "You also need to recruit, not wait to see who's interested. We decided who the best people were, and went after them."

Like Shalala, Thompson has learned that much of federal health and welfare policy comes out of the White House. The Clinton administration left Shalala out of its sweeping-and ultimately unsuccessful-health care reforms. But Thompson does manage to get his oar in. "Watching him in meetings, he is very quick to express the view of those at HHS who advise him, and his own views," says Sen. Bill Frist, R-Tenn.

Still, plenty of White House heavyweights are working on health care and welfare policy. They include Ron Haskins, a senior adviser to Bush for welfare policy and a former welfare expert with the House Ways and Means Committee-not to mention OMB Director Mitch Daniels, with whom Thompson has reportedly clashed over budgetary constraints.

That might explain why some administration proposals issued with Thompson's signature in Washington differ markedly from the programs he championed in Wisconsin. Known as an independent-minded, "Main Street" Republican, Thompson invested heavily in social programs as governor. He candidly told his fellow governors that it would take extra money to properly reform the welfare system.

But in Washington, the money isn't there. Thompson is working with a flat budget at best. On the health care front, the administration has stressed tax credits that would allow individuals to buy their own insurance coverage. In the welfare arena, the administration wants to boost work requirements from 30 hours to 40 hours per week, but failed at the outset to offer states more child-care funding. The welfare bill recently approved by the House does boost child-care spending somewhat, but some governors remain unsatisfied. They complain that the plan undercuts state flexibility, something Thompson embraced as governor.

"My guess is that left on his own, he might very well pursue a different collection of strategies," says Don Kettl, a professor of public affairs and political science at the University of Wisconsin at Madison. "But now he is part of an administration where it is clear that the prime decisions are going to be made by the White House and OMB."

Democrats, in particular, grouse that higher-ups in the administration don't listen to Thompson as much as they should. "I wish he would lead on the subject of health care policy," says Rep. Fortney "Pete" Stark, D-Calif., the ranking Democrat on the House Ways and Means Health Subcommittee. "And I think the administration would end up serving the needs of certain seniors better. They should let Gov. Thompson be Tommy, and then we'd get something done."

At a recent Ways and Means Committee hearing, Stark ribbed Thompson about a recent poll that some Wisconsin Republicans commissioned to see how the former governor would do if he quit the Cabinet and came back to vie for his old job again.

Thompson disavowed the poll. But Wisconsin has no term limit for governors. Noted Kettl: "He could come back and still be 'Governor for Life.'" In the meantime, Thompson is likely to keep up his quips about life in Washington. The only question will be how seriously to take them.