House Committee Labors for New Laws

Insight on the News, Oct 27, 2003

Byline: Jennifer G. Hickey, INSIGHT

House Committee Labors for New Laws

The House Education and the Workforce subcommittee on Employer-Employee Relations has approved a series of measures to increase transparency concerning labor-union disclosure forms and strengthen the authority of the Labor Department to hold unions accountable. Three bills (HR 992, HR 993 and HR 994) moved to the full committee on a 12-10 party-line vote Oct. 2 but face uncertain action. Initiatives to update financial-disclosure forms, or LM-2s, sponsored in the 107th Congress by Rep. Sam Johnson (R-Texas) never emerged from committee.

Election-year politics may thwart chances of passage of any of these measures, yet reform has taken another step, albeit down another route. A day after the subcommittee vote, the Labor Department announced final rules to update the disclosure forms required under the Labor-Management Reporting and Disclosure Act, as well as requiring greater detail about spending practices by unions with more than $250,000 in annual receipts. As many as 500 small unions will be exempted from filing the more-detailed reports, according to the department.

The changes came after a public-comment period in which the department received more than 35,000 statements. In addition to requiring moredetailed itemization of spending of compulsory union dues, the revisions will permit members to obtain information about transactions involving union trusts and "joint funds." The Labor Department will provide computer software, to facilitate online filing, without charge.

Nonetheless, the large unions affected by the rules did not embrace the action. AFL-CIO President John Sweeney issued a statement in which he attacked the department's motives as a "blind determination to weaken workers' organizations." He also maintained the new rules would increase "red tape for all unions, large and small."

The Problems With Health Coverage

With Senate action still pending on the Small Business Health Fairness Act of 2003 (HR 660), the General Accounting Office (GAO) has released a report analyzing the extent of federal and state requirements on the provision of health-care coverage by small businesses. Sen. Richard Durbin (D-Ill.) made the request for the analysis in light of legislative proposals to permit small businesses with fewer than 50 employees to pool coverage through association health plans (AHP).

The GAO examined eight states with varying degrees of coverage and found that while "federal law generally requires all private employers offering health coverage to their employees to meet certain minimum requirements, states have primary responsibility for regulating health-insurance policies sold by insurers." For example, only half of the states analyzed mandated coverage for mental-health care, and among those states the threshold that must be met for coverage and associated services varies widely.

The Senate last acted on the AHP legislation on June 30, referring the measure to the Senate Health, Education, Labor and Pensions Committee. On June 19, the House passed the bill by a vote of 262-162. The GAO report may not force any legislative hands, but it shines some light on how and why it is so difficult to address rising health-care costs and falling coverage from the federal level.

Wrangling Over Waste, Fraud and Abuse

With newfound fiscal discipline being exercised with the Bush administration's $20 billion Iraq reconstruction plan, some are wondering when the pruning sheers will be taken to the overgrowth of waste and fraud in government spending. Alas, penurious politics likely will not be a new trend if disagreement over a new report is any indication. On Oct. 2, House Budget Committee Chairman Jim Nussle (R-Iowa) released a compilation of data gathered by congressional committees and the General Accounting Office about waste, fraud and abuse.

Included in the conference report on the budget for fiscal 2004 was a requirement that House authorizing committees track and document examples of waste, fraud and abuse and then recommend efficient ways to combat such spending. The 427-page report identified waste totaling $85 billion to $100 billion over 10 years, be it from double payments, fraudulent claims or a failure to require cost-saving competitive bidding for federal programs.

"Government waste cannot be eliminated by a single agency, or a single legislative vehicle or a single report," Nussle said of the report, which he added was neither the beginning nor the end of the process.

Rep. John Spratt of South Carolina, the ranking Democrat on the panel, took issue with the Nussle report for failing to suggest legislative changes that would produce $132 billion in savings from the mandatory budget. Furthermore, Spratt said, while the 15 authorizing committees were to submit their findings by Sept. 2, the Armed Services, Resources and Science committees had failed to do so.

Although it might be tempting to "add up the estimated costs of all examples of waste and fraud identified by departmental inspectors general and then declare the problem solved," Spratt said, the report only highlights "that the more challenging task is figuring out what steps Congress can take actually to save taxpayer money by reducing waste, fraud and abuse."