The lobbying expenses of the top 13 health insurers and their industry association, America's Health Insurance Plans (AHIP), spent nearly $8.2 million in the third quarter of 2009 to influence Congress on upcoming health care legislation, according to analysis released today by the nonpartisan campaign finance watchdog Public Campaign Action Fund (PCAF). The total marks an 11 percent increase over the pace of their spending in the first half of the year.
According to PCAF analysis, which was based on figures compiled by the Center for Responsive Politics, these top insurers and AHIP have spent $22,957,382 to lobby Congress and the Administration from January through September. AHIP, the insurers' trade association, has spent more than $6 million this year. The analysis reviewed data for the top insurance companies as identified by Fortune magazine's rankings.
Corporation/Association
Lobbying
Lobbying
Total
Q1-Q2 2009
3Q 2009
Aetna Inc
$1,441, 639
$580,743
$2,022,382
AHIP
$3,900,000
$2,410,000
$6,310,000
Amerigroup Corp
$215,000
$160,000
$385,000
Centene Corp
$230,000
$130,000
$260,000
Cigna Corp
$720,000
$260,000
$980,000
Coventry Health Care
$300,000
$150,000
$450,000
Health Net Inc
$680,000
$330,000
$1,010,000
Healthspring
$90,000
$60,000
$150,000
Humana Inc
$950,000
$900,000
$1,850,000
Molina Healthcare
$270,000
$140,000
$410,000
UnitedHealth Group
$2,500,000
$1,010,000
$3,510,000
Universal American Financial
$865,000
$895,000
$1,760,000
WellCare Group
$200,000
$70,000
$270,000
Wellpoint
$2,420,000
$1,080,000
$3,500,000
Total
,$14,781,639
$8,175,743
22,957,382
"These insurance industries have invested heavily in expensive lobbyists and campaign contributions to make sure their needs are met while the rest of us are stuck with a broken health care system and little way to have our voices heard in Washington," said Donnelly. "It's time to sever the ties between special interest money and our elected officials. It's time to pass the Fair Elections Now Act."
A top lobbyist for the major private insurance industry trade group, America's Health Insurance Plans (AHIP), urged Congressional Republicans to not even consider helping Democrats pass health care reform lest they aid an 'enemy who is down.'
Steve Champlin, a lobbyist for the Duberstein Group who represents AHIP, declared that the road to a bipartisan health care reform bill was, essentially, dead. And he urged GOP members to keep it that way.
"There is absolutely no interest, no reason Republicans should ever vote for this thing. They have gone from a party that got killed 11 months ago to a party that is rising today. And they are rising up on the turmoil of health care," said Champlin. "So when they vote for a health care reform bill, whatever it is, they are giving comfort to the enemy who is down."
AHIP - the insurance industry, has funded a new study attacking the Senate Finance Committee health reform bill, claiming it will hike family premiums.
The White House to then issued new talking points attacking the study as a “self serving” effort to defend its “profits."
While the study seems to help reform foes, it actually makes a good case for Single-Payer or a Medicare like Public Option and should make it easier for Dems to cast opposition to reform as orchestrated by the insurance companies.
Ezra Klein shreds the report on the facts, as does Jonathan Cohn who got MIT economist Jonathan Gruber to review AHIP's PriceWaterhouseCoopers report and says that the AHIP Claim on Benefits Tax is "Implausible".
The health insurance industry has been working until recently to help draft legislation, while publicly endorsing President Barack Obama's goal of affordable coverage for all Americans. The alliance has grown strained as legislation advances toward votes in Congress.
Late Sunday, the industry trade group America's Health Insurance Plans sent its member companies a new accounting firm study that projects the legislation would add $1,700 a year to the cost of family coverage in 2013, when most of the major provisions in the bill would be in effect.
I think they make an excellent case for Single-Payer... Medicare For All:
Study: Premium increase
Premiums for a single person would go up by $600 more than would be the case without the legislation, the PricewaterhouseCoopers analysis concluded in the study commissioned by the insurance group.
"Several major provisions in the current legislative proposal will cause health care costs to increase far faster and higher than they would under the current system," Karen Ignagni, the top industry lobbyist in Washington, wrote in a memo to insurance company CEOs.
The study projected that in 2019, family premiums could be $4,000 higher and individual premiums could be $1,500 higher.
But the PricewaterhouseCoopers analysis attempted to get at a different issue — costs for privately insured individuals.
It concluded that a combination of factors in the bill — and decisions by lawmakers as they amended it — would raise costs.
The chief reason, said the report, is a decision by lawmakers to weaken proposed penalties for failing to get health insurance. The bill would require insurers to take all applicants, doing away with denials for pre-existing health problems. In return, all Americans would be required to carry coverage, either through an employer or a government program, or by buying it themselves.
Other factors leading to higher costs include a new tax on high-cost health insurance plans, cuts in Medicare payments to hospitals and doctors, and a series of new taxes on insurers and other health care industries, the report said.
While I do believe the Insurance Industry through AHIP is being disingenuous with this report, it does still demonstrate how current plans under review are far more complicated and expensive than they need to be. We have a historic opportunity for members of Congress to go on the record in support of single-payer legislation and we should push for those votes. A significant of YES votes helps establish a benchmark so with healthcare reform returns for debate again - as it will given the plans offered - we won't have single payer taken off the table before then negotiations begin.
Note that the text in the above forms will need a bit of revising - which you are free to do and should do. I would also urge you to ask them to request that the Congressional Budget Office score HR-676. Let Congress and the public see where the real efficiencies are.
Industry representatives put Congress and the Obama administration on notice that if health-reform legislation doesn’t send even more new customers the industry’s way or if a windfall profits tax is included, the industry would hit businesses, individuals and the government with higher premiums, effectively defeating one of the initiative’s top goals, reining in ever-rising costs.
The industry’s chief complaint, which was raised in connection with an already-industry-friendly bill cobbled together by Senate Finance Committee chairman Max Baucus, is that the legislation would push 29 million more Americans into the insurance market, but that they might be the sickest and thus costliest people.
The industry wants more of the estimated 25 million still uninsured – especially healthy, young people – to be compelled to buy policies, too. Without more healthy customers added to the mix, the industry says it will have no choice but to raise rates.
BILL MOYERS: You know from the news that early next week the Senate Finance Committee is expected to vote on its version of health care reform. And therein lies another story of money and politics.
Polls show the overwhelming majority of Americans favor a non-profit alternative -- like Medicare -- that would give the private health insurance industry some competition. But if so many Americans and the President himself want that public option, how come we're not getting one?
Because, the medicine has been poisoned from day one, in part because of that same revolving door that Congresswoman Kaptur and Simon Johnson were just talking about. Movers and shakers rotate between government and the lucrative private sector at a speed so dizzying they forget who they're working for.
The American Association for Justice — the trial lawyers’ lobby group — has just released an astounding statistic: medical malpractice insurance companies’ average profits are higher than those of 99 percent of Fortune 500 companies.
AAJ’s report released today finds that the average profit of medical malpractice insurance companies is higher than 99 percent of all Fortune 500 companies and 35 times higher than the Fortune 500 average for the same time period; and malpractice insurers have seen their profit margins range from 5.9 percent to 74.8 percent, with an average of 31.2 percent. The report also finds that malpractice insurers have publicly overestimated their losses and underestimated their profits in an attempt to suggest the insurance business and medical practice in general faces a crisis that must be resolved by so-called “tort reform” — i.e., making it harder for patients to sue and to collect damages for their injuries.
Determined to get as many people as possible covered, lawmakers first proposed fines of as much as $3,800 per family for health insurance scofflaws. But they have been steadily scaling back the penalties, with the Senate Finance Committee last week dropping them to $1,500 maximum per family in their version of a health care bill. The committee also phased the penalties in over five years with no fines at all in the first year and eliminated all criminal and most civil punishments for failure to pay.
The industry -- counting on millions of more Americans buying insurance -- says the penalties are now so weak they practically beg to be ignored. The result, the companies warn, is that people would wait until they get sick to buy coverage. That would raise premiums for everyone else, since Congress' health care overhaul would also require insurers to take all applicants.
Read more at: http://www.huffingtonpost.com/2009/10/05/health-insurance-companie_n_310591.html
Netting $2.5 billion in profits last year wasn't enough for WellPoint, the nation's largest insurance company. Now, WellPoint's affiliate, Anthem Blue Cross and Blue Shield, is suing the state of Maine for refusing to guarantee it a profit margin in the midst of a painful recession.
While the Senate Finance Committee is slogging through more than 530 amendments to Sen. Max Baucus’ flawed health care reform bill, more than 2,700 lobbyists are working overtime to protect the private health insurance industry and other health care corporations.
Yesterday, AFL-CIO President Richard Trumka called for an investigation into the connection between the millions of dollars that health insurance companies are spending on lobbying expenses to kill health care reform and soaring premiums. Today, Bloomberg News reports that more than half of the health care industry’s hired-gun lobbyists are former congressional staffers, White House employees or government agency veterans—55 are former members of Congress.
Sen. Jay Rockefeller (D-W.Va..) and Sen. Chuck Schumer (D-N.Y.) each plan to offer a public option amendment next week. Says Rockefeller:
A health-care plan without a public option is a much weaker health plan because insurance companies continue to rule. [A public option] is going to force other companies to bring down costs over time.
All 10 committee Republicans will oppose the amendments and it may not win enough of the 13 Democratic votes. If it fails in committee, Schumer says he will take the fight to the floor when the full Senate votes.
It's also a waste of taxpayer money when a physician opts out. 'We are all paying out of our pockets to produce doctors,' said Mosley.
That's because medical residency programs are mostly funded by Medicare to the tune of $9 billion to train about 100,000 residents annually, according to the Medicare Payment Advisory Commission.
'It's Medicare that funds hospital costs to house residency programs, pay salaries of residents and sometimes pay faculties' salaries,' said Mosley.
Dr. Patricia Perry, 44, a dermatologist based in Burbank, Calif., operates a solo practice. She mostly performs medical procedures such as skin biopsies.
Perry said she's 'seeking to get out' of her profession because she's fed up with insurance reimbursement challenges while struggling to cover other costs associated with being a doctor.
'When you get to a point where you feel unappreciated and you're arguing with people about being paid, it takes away the passion for what you do,' Perry said."
I admit that I was unaware that our government run Medicare program was also helping pay for so much to provide the nation with doctors. On top of making sure that all of our elderly citizens have access to basic medical care. Seems like a great return on our investment.
The rest of the article relates to other costs, like malpractice insurance premiums, that continue to rise while reimbursements from insurance companies are not increasing.
Individuals and businesses have seen insurance premiums skyrocket. But doctors are not getting increases in reimbursements for services. Where is the money going? Funneled into CEO salaries instead of providing care.
Earlier this week, the Wall Street Journal reported that AHIP — the multimillion dollar lobbying juggernaut for the health insurance industry — has mobilized 50,000 employees to lobby Congress to defeat the public option. ThinkProgress has learned that AHIP’s grassroots lobbying is being managed by the corporate consulting firm Democracy Data & Communications. DDC has made a name for itself as one of the most effective stealth lobbying firms. Earlier this summer, DDC was caught by reporters using a front group called “Citizens for a Safe Alexandria” to attack the Obama administration for seeking to prosecute Guantanamo Bay prisoners in Alexandria, VA.
According to the server-information hub Domaintools.com, the AHIP grassroots outreach website AHIPAdvocacy.org is hosted on a server owned by DDC. Though DDC conceals the hosting of its other websites using a service called DomainsByProxy, ThinkProgress has obtained a list of the domains hosted on DDC servers. A review of this data shows that DDC maintains the grassroots outreach websites for large health insurance companies, but also for big tobacco and Koch Industries:
– phillipmorrisusaactioncenter.org (Altria)
– tobaccoissues.com (Altria)
– kochpac.com (Koch Industries)
– aetnavotes.com (Aetna)
– healthactionnetwork.org (WellPoint)
– humanapartners.com (Humana)
– ahipadvocacy.org (AHIP)
DDC is a firm that promises “high impact” outreach programs to not only influence the grassroots, but “change attitudes for the long term.”
As the Washington Post explains, DDC pays over 500 contract workers to “spend much of their day telephoning people around the country and asking them to sign letters to Congress that press for legislation.” The firm helped orchestrate “grassroots” support for President Bush’s push to privatize Social Security, and helped manage online efforts for the right-wing attack group Freedom’s Watch. DDC is headed by B.R. McConnon, a former associate of Jack Abramoff’s lobbying partners, and a former employee of the Koch-funded astroturf organization known as Citizens for a Sound Economy.
Citizens for a Sound Economy — which has also received funds from private health insurers in the past and played a critical astroturf role in killing reform under Clinton — eventually split, with one wing forming Americans for Prosperity in 2003, and another forming FreedomWorks in 2004. Both organizations, which are still funded by the Koch Industries empire, were instrumental in organizing the anti-Obama tea party protests, and have been spreadingmisinformation and anger at the current health reform effort. Americans for Prosperity’s anti-health reform front group, Patients United, has hosted speakers comparing the House health reform bill to the Holocaust.
Curiously, DDC servers also host anti-health reform letters from the Chamber of Commerce and Rep. Charles Boustany (R-LA), as well as continual news updates about the reform debate. All three documents are under a subsection titled WellPoint.
Given the stealthy nature of astroturf lobbying firms, it is difficult to discern the extent to which DDC is managing AHIP’s efforts. UnitedHealth, another large insurer, was caught recently using a call center to direct people to a radical tea party anti-health reform protest outside of the offices of Rep. Zach Space (D-OH).
Already, the health insurance industry has flexed its muscle to water down reform. After spending millions on lobbying, advertising, and direct contributions to lawmakers, the Senate Finance Committee made a major concession allowing insurers to reimburse only 65% of medical bills (down from the 76% proposed requirement). And indeed, although AHIP has made grandiose promises of self regulation, many insurers have recently broke promises made by AHIP President Karen Ignagni. On June 16, despite Ignagni’s pledges of commitment, insurance executives from UnitedHealth Group, Assurant, and WellPoint specifically refused to “commit” to ending the controversial practice of rescinding coverage after an applicant files a medical claim.
With DDC’s stealth lobbying assistance, AHIP may well kill the public option too.
By the time Congress returns from its recess and takes another whack at the health insurance mess, Rep. Henry Waxman, D-Calif., will have started revealing the deceit that protects health business profiteers.
Waxman has already begun by demanding that major insurance companies reveal how much they pay top executives and board members and, most important, the size of their profits from selling policies.
He is getting to the heart of the health insurance debate. It’s all about the health business—insurance, hospitals, pharmaceutical and biotech companies, medical equipment makers and others.
A spokesman for America's Health Insurance Plans, the industry's trade group, admitted in an article published Monday that as many as 50,000 industry employees are involved in an effort to fight back against aggressive healthcare reform.
The admission, published in the last sentence of a Wall Street Journal article, highlights the stakes of potential healthcare reform for the private health insurance industry. Insurers and investors alike are terrified at the prospect of a so-called “public option,” which would create a government-run health insurance program to compete with private insurers. Because the government plan wouldn't have to earn a profit, the plan would be able to undercut the premiums of private firms, pressuring profit margins.
Not only is Obama clearly ready to throw the public option overboard, he is embracing the requirement that we all be forced to buy insurance from private insurers. That means your tax dollars and mine will be used to pay subsidies to the big insurers to provide coverage to people who can't afford to buy their policies, because the big insurers charge far more than they should because Wall Street investors demand that they do.
One of the people who undoubtedly talked Obama away from the public option and into supporting this mandate is his new BFF, Aetna CEO Ron Williams. Williams, who made $65 million off of Aetna's policyholders' premiums over the past two years and who was the mastermind behind Aetna's shedding of eight million members a few years ago to meet Wall Street's demands, is the insurance industry's leading champion of requiring us all to buy insurance. And, of course, without a public option, we'll all be forced to buy coverage from Aetna or one of the other private insurers.
According to a recent article in Forbes, Williams has been to the White House a half a dozen times recently to advise the president and his staff on health care reform. That same article quoted a Wall Street analyst as saying that Aetna likely will dump about 600,000 policyholders during the coming months to satisfy its investors' unrelenting profit demands.
During his speech in Montana, Obama talked a lot of trash about the insurance industry. Don't be fooled by that tough talk. It's all part of a strategy to try get us to believe we'll get the reform he promised during the campaign. Industry leaders are in fact delighted he's denouncing their behavior, because they believe most of his supporters -- who were hopeful the stars might finally have aligned for real reform -- will be fooled into thinking the reform bill that reaches his desk will benefit them more than the special interests with their armies of lobbyists. And they know the nonprofit cooperatives Sebelius and Gibbs are now trying to sell us on don't have a prayer of succeeding. The big for-profits will never let them get off the ground in any meaningful way.
Sadly, I believe the fat cats are winning and that the bill Congress sends the president will be one that gives an industry with an unsustainable business model a new lease on life and a guarantee of unprecedented future profits.
So I hope the president's aides are buying lots of lipstick. He'll need all he can get to put on that pig of a bill.
Special Comment on Health Care Reform in this country, and in particular, the "public insurance option":
Excerpt:
You get something done, at a doctor's, at a dentist's, at an emergency room and the bills are in your hands before the pain medication wears off. And if you're one of the lucky ones, and you have insurance, you submit the endless paperwork and no matter whether it's insurance through your company, or your union, or your non-profit, or on your own dime, you then get your turn… at the roulette wheel.
How much of it is the insurance company going to pay this time? How much of it is the insurance company — about which you have next to no choice, and against which you have virtually no appeal — how much is this giant corporation going to give you back? What small percentage of what they told you they were going to pay you, will they actually pay you? You know the answer. And, you know the answer if you don't have insurance. But do you know why that's the answer?
Because the insurance industry owns the Republican Party. Not exclusively. Pharma owns part of it, too. Hospitals and HMO's, another part. Nursing homes — they have a share. You name a Republican, any Republican, and he is literally brought to you by... campaign donations from the Health Sector.
Americans United for Change, a group that supports President Obama's plans to overhaul the health care system, released a new television advertisement on Monday, lumping together Republicans and health insurance executives as allied forces trying to derail reform:
Although still very much under-recognized and fought against by the medical industrial complex and complicit corporate media, there is only one solution to cost containment of our runaway market-based health care system. H. R. 676, coupled with a private delivery system, is a paygo alternative that assures universal coverage of necessary health care for all Americans. It would save up to $400 billion a year and provide a structure within which to put in place other cost-saving efficiencies.
The private health insurance industry is an impediment to reform, not part of the solution. It has survived to this time only through generous subsidies from the government, whether in the employer-based or individual markets or privatized Medicare and Medicaid programs. Until we recognize this, all of our incremental approaches to build on our multi-payer system will be of no avail.
In the health care debate, the one question we should be asking is: What is the marginal value of having private health insurance? Advertisement
After all, if the purpose of health insurance is to mitigate the financial consequences of catastrophic illness or injury, the current level of medical bankruptcy shows that having such “insurance” is, for many Americans, anything but. Recent research from Harvard University and Ohio University showed that 78% of the individuals whose illness led to bankruptcy had health insurance at the onset of the illness that pushed them or their families into bankruptcy court.
Yet we continue to trust private insurers. Policymakers and federal legislators seem to have blind faith in their ability to solve the problems of American health care.
