Private Health Care Lobby Dictates Terms in Health Care Reform

The frequently imbibing comedian W. C. Fields once proudly
declared: “Everything I do is either illegal, immoral, or fattening.”  The adjectives used by Fields perfectly
characterize the role of the private health insurance industry in the debate
about health care reform.  As the
debate intensifies more and more private health care profits are being recycled
into the political decision-making process — framing debates, shaping legislation,
padding election war chests, and marginalizing increasingly popular attempts at
the abolition of private health insurance.


“It’s a bonanza!  Hallelujah!” declared ex-private Health Insurance CEO
Robert Laszewski when asked about the health care reform being proposed by the
US House of Representatives (HR 3200). 
A seemingly strange reaction, after all the high-sounding rhetoric from
the White House about the deficiencies of the private health care
industry.  Strange, that is, until you
begin to follow the money.  The
health insurance and pharmaceutical lobby works from the top to the bottom of
the political system.  Large-scale
contributions to the presidential campaigns of Barack Obama and John McCain
coupled with smaller payments to all the legislative players in Washington
serve to infect all parts of political decision making.

The powerful lobbying arm of health care was on an unusually
public display during a sensitive period in the health care reform debate from
May to July of this year.  The
lobby spent a massive $1.4 million a day to ensure their control over the
proceedings.  This frenzy
contributed to the sector racking up $133 million in lobbying expenditures in
the second quarter of 2009 alone, by far the highest total of any interest

Lobbying is an insider game and the health care lobby has
assembled an impressive collection of former congressmen, aides, and even
congressional family members to do its bidding.  All told, more than 350 former government staff members are
employed as lobbyists by private health insurers and pharmaceutical companies.  This army of insiders is deployed each
day in Washington to ensure privileged access to elected representatives who
hold the fate of health care reform in their hands.

The line between private industry and public office is,
therefore, a frequently crossed one.  Examples abound, but the political
careers of two insiders best illustrate the incestuous relations between
politics and industry.  After a political career that saw him transform
himself from a “Blue-Dog” Democrat to a full-fledged Republican,
Louisiana native Billy Tauzin realized his true calling as a health care
lobbyist.  The Pharmaceutical
Researchers and Manufactures of America jumped at the chance to capitalize on
Tauzin’s 24 years of insider connections. 
For Tauzin, the handsome sum of more than $2 million a year far eclipsed
the meager salary of a public official. 
Jack Ebler took a different route working from his job as president of
the Alliance of Community Health Plans to a position as a senior adviser for
health policy to the House Energy and Commerce Commission.  The Commission played a key role in
crafting the current HR 3200 proposal.

Ebler continued to receive consulting fees from at least
five private health insurance companies while he advised the Commission.  Together, Tauzin and Ebler have
profited from the revolving door between government and industry, accumulating
fat paychecks while placing limits on much needed reforms.

Corporate Family Values
in Indiana

The corporate hand directing legislation is so thorough
that, in Indiana at least, it even extends to the dinner table.  Here Evan Bayh, House Representative
from Indiana, and Susan Bayh, member of the Board of Directors of Wellpoint Health,
sit down for nightly meals to discuss the events of the day.  Evan could mention the latest proposal
for health care legislation while Susan might offer details of a recent
diatribe against the role of the public sector in health care.  This power couple has profited mightily
from their relationship.  February
3, 2006 was a particularly good day. 
Evan had just passed legislation which allowed seniors to extend
long-term medical care offered by private companies, while Susan exercised
stock options to buy 20,001 shares of Wellpoint stock.  Joyous dinner table talk indeed.

Susan Bayh is not just any private health care executive and
Wellpoint is not just any private health insurer.  Bayh is a leading voice in opposition to public health care.
 “Traditional Medicare,” she
argued in a recent BusinessWeek article,
“pays for quantity rather than quality, and all of the pilot programs that
were intended to help government change that . . . have failed.”  Bayh spoke against any public option,
but claimed to support reforms that provide coverage to everyone through
private insurance plans to ensure that “everyone is in the pool.”  The acceptable role for the government,
according to Bayh, is to enforce requirements that people purchase private
health insurance.  No surprise then
that Evan Bayh has followed his wife’s lead by declaring opposition to
single-payer (HR 676) and describing himself as “agnostic” on the
issue of the public option.

Susan Bayh is not, of course, the only resource mobilized by
Wellpoint.  As the nation’s largest
private health insurer, selling plans to more than 80 million people through
its Blue-Cross/Blue-Shield network, the company has much to lose in the health
care reform debate.  It has swamped
the political process with money to limit any potential reforms.  In 2008, Wellpoint made $2.6 million in
campaign donations split evenly between Democrats and Republicans.  This includes 265 members of the House
and 71 Senators.  Not surprisingly,
representatives sitting on the House Ways and Means and Energy and Commerce
Committees, the two key committees for health care reform, were targeted by Wellpoint
campaign contributions — more than $200,000 each.

The Real Town Hall

Not satisfied with purchasing the legislative process,
health care companies have now embarked on an attempt to shape town hall
meetings on health care being conducted throughout the country.  Private health insurance, it seems,
merely suffers from an image problem. 
To combat this, the industry is dispatching thousands of employees to participate
in the town halls.  The goal,
according to a spokesperson for America’s Health Insurance Plans (AHIP), the
leading industry group for private insurers, is to use the meetings as a forum “to
strongly push back against charges that we have very high profits.”  AHIP reports that more than 50,000
employees have also participated in letter-writing and phone call campaigns to
elected representatives to push a pro-private health care agenda.

In many cases, however, there is little need for health
insurance employees to shape the agenda at public town halls on health
care.  Politicians, flush with
campaign contributions, have already completed that task.  In the Bronx, New York, an advertised
town hall meeting was transformed into one-on-one meetings where Representative
Joseph Crowley (D) spoke against single-payer and refused to commit to
supporting a public option.  Crowley
received $5,000 in contributions from Pfizer, Abbott Technologies, and Blue
Cross/Blue Shield (Wellpoint).  A
Brooklyn, New York town hall was reduced to an adolescent classroom as the
crowd was prohibited from speaking and asked to silently write questions out on
index cards.  Representative Yvette
Clark (D), the host of the meeting, received $3,000 from GlaxoSmithKline,
$2,000 from Pfizer, and $2,000 from Blue-Cross/Blue-Shield (Wellpoint).

Thinking beyond
Health Care

Considering the number of resources mobilized by the private
health insurance lobby, there can be little surprise that HR 3200 is a 1,000-page
legislative mess.  The pressure of
the lobby ensured that any reform is framed as part of new “health
insurance exchanges.”  This
idea was concocted by the conservative Heritage Foundation, transmitted by the
health care industry lobby, and is now being mouthed by an assortment of
politicians as a trailblazing virtue — note Obama’s “choice and
competition” slogan.  Yet, the
exchange is one part of a multi-pronged strategy which aims at allowing
mega-corporations the right to sell policies across state lines.  This is the real motivation behind
Susan Bayh’s desire to make sure “everyone is in the pool.”  Once in, the private insurers would do
what they do best — monopolize market shares and inflate prices in the service
of enhancing corporate profits.  They
own the pool.

What passes for democracy in America these days feels like
little more than one facet in a well-financed public relations campaign.  This is why the struggle over health
care is no longer just about this or that reform; it is about the expression of
public will inside a democratic system. 
The question now is how, or even whether, this will can be
expressed.  Industry pressure,
media silence, and politicians on the payroll have managed to effectively
marginalize the only proposal for real health care reform — a single-payer
system.  Americans should recognize
that every day the private health insurance companies are allowed to exist is
one day more of illegal, immoral, and fattening acts.  One more day without health care.  One more step away from an increasingly distant notion of

Billy Wharton is the editor of The Socialist magazine and the Socialist WebZine.   His article “Obama’s No Socialist.  I Should Know” appeared in the Washington Post in March 2009 and was run in several other publications.  Contact: <>.