Louis Sullivan Comes Out Of His Foxhole

If there's one thing that Health & Human Services Secretary Louis W. Sullivan learned early on, it's to keep his head down. Even before his confirmation, the White House forced him to back off his pro-choice stance on abortion. Then, when he said he favored giving clean needles to drug addicts, it pressured him to recant. Later, Sullivan announced that the Administration supported the medicare catastrophic insurance bill, only to be reversed hours later. For Washington's cognoscenti, it was all the proof they needed: The nation's top doctor had the political savvy of Pat Paulsen and no control over policy.

Sullivan has come a long way since he took over the $544 billion department three years ago. By picking his fights carefully, he has won praise for expanding services to the poor and for crusades against the tobacco industry--worthy initiatives, to be sure, but small victories at best.

Now, the 58-year-old hematologist from Atlanta no longer has the luxury of a low profile and narrow niches. He is about to take center stage on what will be a pivotal issue during the Presidential election campaign: health care reform. President Bush was to unveil his health care plan in Cleveland on Feb. 6, and he has picked Sullivan as point man to sell his proposal. The HHS Secretary will appear on talk shows, make speeches, debate Democrats, and try to soothe worried lobbyists and lawmakers.

EXAM TIME. This lead role is clearly Sullivan's biggest challenge yet--and a opportunity to burnish his reputation. Until this year, he was under the thumb of heavyweights in the White House and the Office of Management & Budget on major issues such as family planning and health care reform. But now John H. Sununu, who as White House Chief of Staff held an iron grip on domestic issues, is gone. And Budget Director Richard G. Darman's star no longer burns as bright. "This is Sullivan's big test," says one Administration official. "How he performs will determine whether the past three years have paid off as a first-class education or whether he has flunked."

From the beginning of his tenure, Sullivan was a rare commodity in Washington. A personal friend of Barbara Bush, he brought with him a passion for helping the poor and a reputation for integrity. But the founder and former president of the predominantly black Morehouse School of Medicine in Atlanta was unprepared for the cutthroat battles he would have to wage to assert control over the divisive issues facing his sprawling department.

After his rocky start, Sullivan seemed resigned to navigate within the constraints imposed by White House ideologues and the budget deficit. The HHS Secretary decided to go with his strengths and concentrate on areas where he thought he could have an impact. "Lou Sullivan is a man who looked at the landscape and picked his shots," says a Capitol Hill staffer. "He doesn't have to engage in battle on every issue."

Indeed, he was one of the few Cabinet members who worked tirelessly to help Bush keep his promise of a kinder, gentler America. Sullivan has used his bully pulpit to promote preventive health measures. And he has raised the visibility within HHS of minority health issues and the social problems of black males--areas neglected in the past. Sullivan "has done a fantastic job," says Deborah Steelman, a lawyer who advises Bush on domestic issues.

POSTAL POLITICS. In an era of tightfisted federal budgets, Sullivan also has been able to expand health services for the poor, such as community health centers and programs to increase the number of physicians in underserved areas. He won plaudits for his crusades against the sponsorship of women's sporting events by tobacco companies and for the "slick and sinister" marketing of cigarettes to children. He has hired strong, well-respected managers to run his agencies (table). And he has used his position as the only black Cabinet member to influence Administration policy on civil rights issues.

Yet if there is one policy arena that an HHS Secretary should lay claim to, it's health care reform. And here, while Sullivan has made inroads, Darman has held sway--with what may be disastrous results for the Administration.

Sullivan realized two years ago that the Bush Administration couldn't ignore the rising public clamor for reform much longer. But Sununu opposed any overhaul and refused to give Sullivan a chance even to discuss his views with Bush. So Sullivan began to deliver a series of policy speeches laying out the direction an Administration health policy should take. He also circumvented Sununu's control in August by mailing Bush a letter to his private post office box in Maine, imploring him to move on the matter. Bush's final plan is expected to include many of the proposals Sullivan had been pushing. "We have had a major--no, the major--impact," Sullivan told BUSINESS WEEK.

`SIXTH FLOOR SWAMP.' But officials close to the deliberations say that though Sullivan laid the groundwork, he never came up with a final, detailed plan. Darman rushed in to fill the vacuum. According to sources, Darman is running the meetings that Sullivan and other top officials attend and is coordinating the work of various agencies. "Sullivan himself could have had everything ready by now," says one official involved in the process. "He could have costed it out and made sure everything matched."

Darman's control has not served the Administration well, however. After an uproar from GOP lawmakers, the White House at the last minute was forced to delete references in its 1993 budget to a proposal that would have taxed the health benefits of affluent families--a proposal Sullivan had opposed internally.

Health care reform is only the most visible evidence of Sullivan's inability to control his agency's issues. Last spring, when he came up with a pet program to combat infant mortality, Darman refused to give him new money, forcing HHS to take funds from other poverty and health programs. It was Sununu, not Sullivan, who negotiated with family-planning groups to reach a compromise that would overturn a U.S. Supreme Court ruling and allow clinics funded by HHS to counsel patients on abortion. Talks failed, and Bush vetoed the bill.

Last October, Sullivan announced that the White House would veto a Democratic bill that would have given the Food & Drug Administration new enforcement powers. HHS had earlier penned a similar bill but backed off after industry lobbyists found a sympathetic ear at the Council of Competitiveness, a White House group headed by Vice-President Dan Quayle.

Some Administration insiders complain that the HHS chief doesn't even have full control over his own staff. Decisions he makes sometimes get bogged down in the "sixth floor swamp." For instance, last year, Sullivan verbally signed off mn a controversial regulation changing the way medicare reviews new technology to determine if it should cover its use. But aides have yet to send the rule to the OMB for review, sources say.

Given the White House's determination to dominate domestic policy, Sullivan's prospects for success may have been limited from the start. But now, with health care reform propelling him into the limelight, he has a chance to prove his mettle. The next few months could demonstrate whether the kindly doctor from Atlanta will be a forceful player or just a nice guy with good intentions.

       -- Hires strong managers
       -- Took a high-profile stand against tobacco sales to
      minorities and children
       -- Won new dollars for
      public health programs
        -- Raised the status of
      minority health issues
       -- Doesn't have full control of his own staff
       -- Opposed tobacco ads and exports, then refused to back federal action
       -- Pushed health care reform but failed to develop a detailed plan