Jeffrey Thompson investigation is far from over

Posted at 05:43 PM ET, 09/26/2012

Jeffrey Thompson investigation is far from over

By Mike DeBonis, Washington Post

It’s been too long since I last used this photo. (C-SPAN) On Tuesday morning, federal prosecutors and lawyers for embattled campaign financier Jeffrey E. Thompson entered a closed courtroom to argue over what to do with the 60 boxes of documents and 20 million pages of electronic records seized from Thompson in March.

The dispute is over who should have the first opportunity to peruse the records, which have been sealed because Thompson has not been charged with a crime. Should it be a Department of Justice “filter team,” walled off from prosecutors, that selects pertinent records for criminal review? Or should Thompson’s own lawyers decide which documents are responsive to the government’s search warrant?

The conflict was laid out in a unsealed May court opinion by U.S. District Judge Royce C. Lamberth, whose decision in favor of prosecutors is now being appealed by Thompson.

With the case and Tuesday’s proceedings sealed, there’s no telling what the three U.S. Court of Appeals judges hearing the case are thinking or how soon they might rule. But the fact that investigators have yet to crack open the voluminous Thompson files indicates it could be months before there is significant progress on prosecutions related to the ”shadow campaign” said to have been funded with $653,000 of Thompson’s money.

His erstwhile right-hand woman, Jeanne Clarke Harris, pleaded guilty in July to concealing and disbursing those funds, from a “co-conspirator” that several people familiar with the investigation have confirmed is Thompson.

With Thompson continuing to fight prosecutors tooth and nail, it’s clear that if they want to get their hands on him or the politicians he funded, they’ll have to do it without Thompson’s help.

In Capitol Hill’s shadow, health reform gets underway

In Capitol Hill’s shadow, health reform gets underway

Posted by Sarah Kliff, Washington Post, on September 25, 2012 at 12:08 pm

If you want to know what health reform in action looks like, here’s what you should picture: a nondescript conference room, on the fourth floor of a government building, with about four dozen people sitting in rows of red chairs and one fluorescent light that keeps flickering on and off. No hope, change or death panels to speak of.

This is a public meeting of the District of Columbia Health Benefits Exchange Authority, which convened at 5:30 p.m. on Monday, about a half-mile from the Capitol Hill buildings where legislators wrote the law. It wasn’t exactly a must-attend event. About four rows of chairs, way in the back, were left empty.

But this is actually a pretty important place. It’s where government officials decide what the Obama administration’s signature legislative achievement will look like for residents of the nation’s capitol.

As a resident myself —and an admitted health policy nerd— it seemed worth understanding how my representatives were deciding what health benefits my insurance plan will cover and what my insurance market will look like come 2014.

As far as health exchange boards go, the District’s has some serious health policy star power, a product of the many think-tanks and universities in its jurisdiction. The Brookings Institute’s Henry Aaron sits on the board, as do health policy professors from Georgetown and George Washington universities. As one meeting attendee remarked to me, “It’s kind of cool to think that we really have the best of the best.”

“Cool” wasn’t necessarily an adjective that came to mind during the 80-minute meeting that took place squarely in the weeds of health policy.

It started with the first agenda item: Deciding what set of essential health benefits the District of Columbia will require all insurance carriers to cover. Even in one of the most Democratic-leaning districts in the country, there’s was not exactly enthusiasm for this new piece of federal regulation.

“This is mandated by the law,” District of Columbia insurance commissioner Bill White noted. “This is not something anyone here decided to do.”

Still, they did have to set an essential benefit package – and heard from a few local voices on how to do it. Peter Rosenstein directs government affairs for the American Academy of Orthotists and Prosthetists and urged more comprehensive coverage for orthotics and prosthetic devices for children.

“One role you all have is determining levels of coverage,” Robinson said. “Have you considered things like prostheses for a child who loses their legs in an accident or cancer? If your child is 3-years-old when he loses his legs, he’ll need six prostheses by the age of 21.”

Another consumer health advocate commended the board on including a pediatric vision benefit (which also is required by the federal law). But the one who followed contended that the one pair of glasses-per-year provision didn’t go far enough, pointing out that “often times kids have glasses and lose them. If they’re limited to one, a child might have to go a whole year without them if a parent can’t afford a replacement.”

These are just two among a multitude of decisions, on everything from orthotics to optometrics, that the exchange board will have to decide as it figures out its essential benefit package. It’s not exactly the most exciting of debates, but it’s important in shaping the medical care that local residents will have access to.

Next up on the agenda was the District of Columbia health insurance exchange, the new marketplace where residents will be able to use federal subsidies to purchase insurance coverage.

The District of Columbia has been one of the more aggressive implementers of President Obama’s signature health-care legislation (the politics of the District make it an easier sell than in, say, neighboring Virginia). It is among only a handful of states that have committed to running their own health insurance exchange, rather than ceding the task to the federal government.

Even with widespread support, the District still has a to-do list that stretches 11 PowerPoint slides long. They have to decide whether all insurance plans will be sold through the insurance exchange, or if there will still be an outside market.

Processes need to be put in place to vet insurance plans to make sure they meet new federal mandates. A communications plan must be put in place, so that District residents actually know about the new marketplace. There’s also the not-so-small matter of hiring an executive director. These are big decisions that will shape how residents buy insurance here just 15 months from now.

All of it is supposed to be done by Jan. 1, 2013, but officials here recognize, despite their commitment, it’s just not possible. Even the most stalwart of Obamacare supporters just simply have too much work to meet that deadline, and will instead seek “conditional approval”: They will lay out what they plan to do for the federal government, rather than have it done.

“No state is going to be able to be fully certified on Jan. 1,” said Bonnie Norton, D.C’s acting director of health reform.. “When they passed the ACA, they were highly optimistic about the timeline for states to implement exchanges.

As Norton went through her presentation her microphone kept going fuzzy with interference, interrupting her presentation and causing audio-visual specialists to intervene.

It got noisy enough that, at one point, board member Henry Aaron quipped “I hope your processes go better than this.”

Many of those at the sparsely attended-meeting smiled in agreement.

D.C. Environment staff unsettled by ‘Attila the Hun’ talk after firing

D.C. Environment staff unsettled by ‘Attila the Hun’ talk after firing

Called to ‘march of shame’ meeting

By Jim McElhatton

The Washington Times

Tuesday, September 25, 2012

Not long after the sudden firing of the District’s top environmental official, Christophe Tulou, last month, employees from the city’s Department of Environment were told to report to a hastily arranged meeting at the D.C. government offices on Fourth Street Northwest.

The purpose, the staff members were told, was to reassure them that Mayor Vincent C. Gray’s administration fully supports the agency. It was the sort of morale-boosting pep talk that employees of an agency where the director gets fired might expect to hear.

But in a wide-ranging talk that lasted about 20 minutes, D.C. City Administrator Allen Lew informed the employees that they were fortunate his chief of staff, Warren Graves, wasn’t in charge.

"You guys are really lucky I’m the city administrator because if Warren Graves was in charge, there would be a lot more collateral damage," Mr. Lew said, according to an audio recording of the meeting obtained by The Washington Times. The Times confirmed the meeting and comments through multiple agency sources.

In subsequent comments, Mr. Lew joked about how a colleague said Mr. Lew had gone to the Attila the Hun school of management, a line that didn’t get any laughs. Mr. Lew also said that Mr. Graves had suggested that Mr. Lew ought to manage by fear. The city administrator, adding that he disagreed with Mr. Graves’ management suggestions, later remarked on what he thought was an "incestuous relationship" between DDOE and the Environmental Protection Agency (EPA).

Taken together, the remarks have left some DDOE employees feeling far from reassured, according sources inside the department who spoke on the condition that their names not be made public for fear of losing their jobs.

"It feels like the agency has been neutralized," one DDOE employee said. "I think the real message he was trying to get across was to instill fear. It’s had a devastating impact on staff morale."

The remarks by Mr. Lew also have raised deeper concerns about the department’s stormwater oversight duties involving the District’s water and sewer utility, D.C. Water, where Mr. Lew serves on the board of directors. A spokesman for Mr. Lew recently told the Washington Business Journal that Mr. Lew was planning to take "a hard look" at DDOE operations after Mr. Tulou’s firing to ensure that the agency isn’t overstepping its regulatory role.

It was a plan backed in part by D.C. Water that set off the chain of events that led to Mr. Tulou’s firing, sources said. In response to a request from the EPA, the DDOE submitted comments on a draft agreement by the EPA, D.C. Water and the mayor’s office on a "green infrastructure" project to reduce sewer overflows into the Anacostia and Potomac rivers and Rock Creek, according to sources with knowledge of the DDOE comments. An EPA spokesman declined to comment other than to say the federal agency has worked closely with DDOE and will continue to do so.

The Gray administration has explained the reason for Mr. Tulou’s firing was a "serious breach of protocol." Reached by phone, Mr. Tulou declined to comment. Though he is the most visible example of the "collateral damage" referenced by Mr. Lew, Barry Weise, who served as the department’s regulatory and legislative liaison, was dismissed on the same day Mr. Tulou was fired. He, too, declined to comment. Two other department lawyers were suspended, The Times has learned.

Donna Henry, a DDOE spokeswoman, said Tuesday that Mr. Gray still supports the department and that he visited the agency last week.

"Nothing has changed," Ms. Henry said. "There’s been no shift in the administration’s feeling toward us or support of us."

Asked about Mr. Lew’s remarks, Tony Robinson, a spokesman for Mr. Lew, wrote in an email that the city administrator wasn’t available Tuesday.

"Also, he will not make any further statement on the recent DDOE disciplinary action or subsequent communication with staff as these are personnel matters," Mr. Robinson wrote in an email.

Mr. Lew was more talkative in his remarks to DDOE staffers, telling them that everybody in the department, as well as in other agencies, ought to have as their top priority supporting the mayor.

"The rest of us are just the supporting cast," he said.

One employee at the meeting raised questions about communicating with the EPA in light of media accounts surrounding Mr. Tulou’s firing, but was interrupted by Mr. Lew.

"You ever heard the line ‘Timing in life is everything,’ you ever heard of that line?" Mr. Lew asked.

"Sure," the employee said.

"This is not about not communicating. We’re not talking about censoring. It’s the timing of some of those communications," Mr. Lew said, adding that malice might not have been behind what he said was one problematic communication by DDOE to EPA.

"Obviously, there’s a very close relationship with EPA," Mr. Lew said, referring to what he called an incestuous relationship between federal and city environmental agencies. Through a spokesman, he declined to elaborate.

Another employee at the gathering questioned why all the workers were told to travel to city offices on Fourth Street rather than Mr. Lew coming to the DDOE headquarters, likening the trip to a "march of shame" for DDOE staffers.

"There was no intent to demoralize you," Mr. Lew replied, saying he wasn’t going to pay rent for space in the convention center. "In fact, I’m trying to boost the morale, not bring you down further."

Poverty Rates in DC Remain High for Certain Groups of Residents

In the Wake of the Great Recession, Poverty Rates in DC Remain High for Certain Groups of Residents

September 21st, 2012 | by DCFPI

New data released today from the Census Bureau’s American Community Survey reveal that the aftermath of the Great Recession continues to hit certain groups of DC residents much harder than others, even amidst signs of economic recovery for the city as a whole. While the District continues to grow, it also is becoming more divided economically among residents.

Poverty in DC rose from 16 percent in 2007, the last year before the recession began to impact the District, to 19 percent in 2011. This means that in 2011, some 109,000 residents lived below the poverty line, or $23,021 for a family of four. Yet, at same time, median income for the District – the income of the household in the middle of the income distribution — rose nearly 8 percent, from $58,700 to $63,100, after adjusting for inflation to equal FY 2011 dollars, over the same time period (Unless otherwise noted, all figures are adjusted for inflation to equal 2011 dollars). The fact that poverty and median income grew simultaneously suggests that as the District begins to grow and recover from the recession, it is doing so in a way that is leaving many groups of residents behind.

Differences in the poverty rate and median household income citywide between 2010 and 2011 were not statistically significant due to large margins of error with the data.

The Recession Continues to Impact Certain Groups of DC Residents

Since 2007, poverty among DC’s children has risen by one third, from nearly 23 percent in 2007 to just over 30 percent in 2011 (see Figure 1), leaving nearly 32,000 children under 18 below the poverty line. Moreover, the percentage of residents of all ages living in deep poverty, or below half of the poverty line, has risen by 21 percent since the recession hit. From 2007 to 2011, the percentage of DC residents in deep poverty (less than $11,511 for a family of four) rose from 8.5 to 10 percent. This means that in 2011 more than 60,000 people lived below half of the poverty line.

Poverty among Black District residents increased from 23 percent to 28 percent over the four year period. The poverty rate among Hispanic residents rose even more sharply, from 11 percent to 18 percent. At the same time, the income for the typical Hispanic household grew from $45,000 to more than $59,000. These findings may suggest economic disparities within the District’s Hispanic population. For example, it may indicate that while middle-income Hispanic households in DC are doing better in 2011 than in 2007, it also suggests that significant share of low-income Hispanic residents have fallen below the poverty line. Meanwhile, poverty among White, Non-Hispanics stayed relatively unchanged over the same time period and stood at 7 percent in 2011.

To read the full report, click here.

CareFirst ruling could spark other challenges

CareFirst ruling could spark other challenges

Experts: Watchdog groups could benefit

Premium content from Washington Business Journal by Ben Fischer, Staff Reporter

Date: Friday, September 21, 2012, 6:00am EDT

Ben Fischer

Staff Reporter- Washington Business Journal

Some legal experts say the D.C. Court of Appeals has given consumer and public interest watchdog groups a new avenue to challenge pro-business regulatory decisions.

In a Sept. 13 opinion throwing out a D.C. insurance commissioner’s ruling that favored CareFirst BlueCross BlueShield, judges found that D.C. Appleseed — a CareFirst critic for more than a decade — would have had legal standing to object even if it weren’t a CareFirst customer because earlier work challenging the insurer’s business practices became one of its primary functions.

In other words, judges found, Appleseed could challenge a regulatory decision because that decision stemmed from a law it helped create, the 2009 Medical Insurance Empowerment Amendment Act, which triggered the review of CareFirst’s premium-funded reserves.

For nonprofit advocacy groups, neighborhood coalitions or environmental activists that fight businesses and the government on the regulatory matters, it’s a subtle, but potentially significant, expansion of their opportunities.

Under current law, such groups sometimes struggle to win the right to challenge rulings because they are pursuing a general social goal and can’t demonstrate a specific harm done to them.

“The court was careful to try to not have the barn door open too wide, but at this point, the barn door’s open,” said Thorn Pozen, a partner at Stinson Morrison Hecker LLP and former staffer in the D.C. Attorney General’s office.

CareFirst had argued Appleseed couldn’t prove it had been directly harmed by the regulatory ruling, in which then-Commissioner Gennet Purcell found that the Owings Mills, Md.-based insurer’s D.C. subsidiary did not have excessively large reserves.

The appeals court, led by Senior Judge Vanessa Ruiz, did not weigh in on the merits of Purcell’s ruling, but did order her successor, William White, to reconsider the case under different standards.

Ruiz wrote that Appleseed could expect a refund had the ruling gone another way, so it already suffered an injury.

Also, she said, D.C. Appleseed had invested so much of its time trying to get nonprofit CareFirst to bankroll more community health initiatives that Purcell’s ruling harmed its operations.

Even though Appleseed does not directly provide health care services, the court found it could sue in “light of its long and dedicated pursuits of the benefits to improved access to health care in the District of Columbia that would flow from greater community investment by [CareFirst],” the ruling reads.

It’s an opportunity, but not a decisive ruling, said Tillman Breckenridge, counsel at Reed Smith LLC and head of the firm’s D.C. and Virginia appellate group. In some detail, the court noted that Appleseed went to extraordinary lengths to press the CareFirst matter — beyond the usual lobbying role.

Some lawyers predicted a rash of lawsuits seeking more clarity on this issue.

“A lot of organizations will try to use this as a basis for standing in the future,” Breckenridge said. “And it remains to be seen whether the court will clarify its language about reducing the effectiveness [of the nonprofit] in a way that makes this decision a narrow one or a broad one.”

However, other lawyers dismissed the standing aspect altogether, saying the court was merely applying a precedent from the Havens Realty Corp. case in 1982, in which a Richmond low-income housing group successfully won the right to sue a real estate developer over allegedly illegal practices.

But, the court said Appleseed was more entitled to standing than another group in a prior case, the Friends of Tilden Park,which tried to stop construction of a Cleveland Park apartment building on the theory that it generally would lower the quality of the neighborhood.

The Hill: Hatch presses HHS for details on federal exchange

Hatch presses HHS for details on federal exchange

By Sam Baker – 09/25/12 05:43 PM ET

The Obama administration hasn’t given states enough information to decide whether they’ll implement the central feature of the Affordable Care Act, Sen. Orrin Hatch (R-Utah) charged in a highly critical request for more guidance.

Hatch, the top Republican on the powerful Senate Finance Committee, said states can’t make well-informed decisions about whether to establish their own insurance exchanges or let the federal government step in with a fallback.

"The President promised ‘an unmatched level of transparency, participation, and accountability across the entire Administration,’ yet the details of his single policy achievement have been hidden from the public and the very people who will are [sic] required to implement the President’s idea of health reform," Hatch said in a letter to Health and Human Services Secretary Kathleen Sebelius.

HHS has said states have three options: set up their own exchange, work in partnership with the federal government or step back entirely while HHS establishes a "federally facilitated exchange."

The Obama administration has pushed each state to take on at least some control over its exchange, saying each state’s insurance market is different. But several Republican governors say they’re unwilling to implement "ObamaCare" by creating a state-based exchange, meaning HHS would have to step in.

HHS has released few details about the federal exchange — states aren’t sure which costs they’ll have to cover if they leave the task up to HHS, Hatch said.

"I respectfully request that the politicization by the Administration of the President’s health law end and that the transparency promised by the President be shown by offering the states a complete understanding of their choices and the cost associated with such choices," Hatch’s letter states.

It’s also unclear, he said, whether HHS will establish a separate federal exchange in each state, and how they will vary from state to state.

Source: http://thehill.com/blogs/healthwatch/health-reform-implementation/258663-hatch-presses-hhs-fo-details-on-federal-exchange

DISB News: D.C.’s Insurance Regulator, Federal Agency Agree to Share Information to Fight Money-Laundering

DISB header
For Immediate Release:

September 18, 2012

Contacts:

Department of Insurance, Securities and Banking

Michael Flagg

Director of Communications

(202) 442-7756, michael.flagg

Financial Crimes Enforcement Network

Steve Hudak

Chief, Public Affairs

(703) 905-3770, steve.hudak

D.C.’s Insurance Regulator, Federal Agency Agree to Share Information to Fight Money-Laundering

Washington, D.C. (September 18, 2012)— The D.C. Department of Insurance, Securities and Banking became the sixth insurance regulator nationwide to agree to share insurance-related financial information with the federal Financial Crimes Enforcement Network in order to prevent money-laundering and other financial crimes.

The department has already signed an agreement to share information on regulated banks and the securities industry with the federal agency, known as FinCEN. The states that have already signed the insurance agreement are Louisiana, California, Wisconsin, Nebraska and Kansas.

“Laundering money is crucial to terrorists and organized crime,” said the department’s commissioner, William P. White. “To fight these sophisticated organizations, law enforcement needs to be just as sophisticated. Sharing information is a big part of that, and I look forward to working even more closely with FinCEN.”

Said FinCEN Director James H. Freis Jr.: “FinCEN is steadily increasing its efforts to work more closely with state financial regulators, and the District will be a key partner for us. Together, we can accomplish more than we can alone and we’ll both be better able to deter, detect, and track criminals.”

FinCEN, a Bureau within the U.S. Department of the Treasury, was created to collect and analyze information about money-laundering, fraud and other financial crimes.

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