Monday, December 14, 2009

How Big Bucks Lobbies Sabotaged Health Care Reform

Dorgan, McConnell, Lieberman and the Money Behind the Politics

By John F. Wasik

I know what the future of America holds if health-reform isn't passed.

More people will be uninsured. Premiums will rise. More employers will either drop coverage or raise out-of-pocket costs. Self-employed folks like me will either lose coverage or pay exorbitant premiums because of chronic conditions or expensive diseases like cancer (our situation now). More people will be bankrupted. More will die because they can't afford life-saving care.

This is not the forecast of a health-care economist, a politician or even Ralph Nader. It is a guaranteed fact because of the current health-insurance business model, the aging of America and the way politics is financed.

Money, politics and health-care lobbies are in a dysfunctional marriage. It's an unholy union that isn't good for most people.

Claims are losses, in insurance lingo. As people get older and sicker they have more health issues. A vast swath of the population is overweight, underexercised and eating poorly. There's a heap of hurt coming to those who have to pay future bills, which is everyone.

As a progressive -- someone interested in a shared prosperity -- it mystifies me why the concept of a fair and affordable national health program is imperiled. We all need it. To me and many others it should be a basic human right and part of our constitution.

Yet as I explore the ecology between political financing, lobbyists and political agendas, the mystery is solved. Let's follow the money.

When Senator Byron Dorgan's (D-North Dakota) amendment finally surfaced last week to import drugs from Canada, the Senate debate melted down. Who could possibly be against allowing Americans to afford life-saving medication?

Dorgan's fellow Democrats Robert Menendez and Frank Lautenberg from New Jersey had a big problem with Dorgan. It didn't surprise anyone that they would object: New Jersey is home to more than 50 pharmaceutical companies and tens of thousands of jobs in that industry.

You could argue that the Garden State senators were protecting constituents; drug companies certainly contributed to their campaigns. An obvious connection.

There's no reason to let the Jersey solons off the hook, though. Lautenberg has a proposal to allow Canadian imports if the Department of Health and Human Services can certify every drug imported is safe. That's the equivalent of asking the Postal Service to inspect every piece of mail. Big Pharma speaks in many harsh voices.

Contributions from Big Pharma didn't appear on a list of top-20 industry donations for Dorgan, however, according to, which monitors campaign financing. Lawyers, electric utilities and Wall Street, certainly, but drugmakers spread their money around elsewhere.

In rare act of political bravery, Dorgan held up the entire Senate health-care debate until he gets a vote on his amendment.

The White House would like to see Dorgan's modest proposal evaporate because it had cut some still undisclosed deal with Big Pharma earlier this year. Nearly every Republican would like the Dorgan amendment disappear to avoid going on record saying that they don't want Americans to be gouged by U.S.-based drugmakers.

Here's another case where big-money politics is completely at odds with the needs of the American people.

I know Canadian (or anywhere outside the US for that matter with national health programs) prices are cheaper because I've priced my wife's chemo-anti-nausea medicines and can save more than half on what they charge at my local pharmacy. It's the same medicine at lower, much more affordable prices. What a concept!

Let's look at a senator from a state with relatively little Big Pharma presence: Republican Mitch McConnell of Kentucky. There are five major pharmaceutical facilities in the Bluegrass State, representing a fraction of the workers that New Jersey employs.

Horse breeding is likely a much bigger industry in the Senate Minority Leader's Commonwealth. Yet drug company PACs were the single-largest contributor to McConnell in the current cycle -- some $262,785 out of a total $416,285.

Ironically, McConnell has a good reason to refuse drug company money. In 2003, the Kentucky Attorney General sued the nation's five largest drugmakers for allegedly boosting prices on drugs for that state's Medicare and Medicaid programs, overcharging them an estimated $100 million.

But McConnell's loyalty to the idea of keeping drug prices high was worth less than a half million dollars. What a bargain for Big Pharma!

What's more important to politicians than getting industry money for a campaign? Not getting it. A half-million dollars is still a lot of money in Kentucky. And it still takes tens of millions to run a successful Senate campaign, even if you're an incumbent.

Notice I haven't said a word about the even-bigger behind-the-scenes player in the health-care debate: the insurance industry. They know whatever happens, they will win big. The current House and Senate plans leave most of the private industry in place.

Insurers -- exempt from federal anti-trust laws -- will likely get even bigger with 30 to 40 million more policies to write if health-reform passes. A handful of companies dominate most states.

While Senators Patrick Leahy (D-Vermont) and Sheldon Whitehouse (D-Rhode Island), are seeking to repeal the antitrust exemption, it's largely a side issue at this point that hasn't been seriously discussed.

The House's recently passed financial reform bill does nothing to aggressively regulate insurance companies, which are monitored by much weaker state agencies.

As former Labor Secretary Robert Reich said in a recent blog:

"From the start, opponents of the public option have wanted to portray it as big government preying upon the market and private insurers as the embodiment of the market. But it's just the reverse. Private insurers are exempt from competition. As a result, they are becoming ever more powerful. And it's not just their economic power that's worrying. It's their political power, as we've learned over the last 10 months."

Finally we have Joe Lieberman, the erstwhile independent from Connecticut, home to many insurers. Over the weekend Lieberman said he wouldn't support the Senate proposal to allow people to buy into Medicare, the last gasp of introducing some competition into the mix.

It's rather anticlimactic to note that insurance money was the single-largest source of Lieberman's PAC funding. Since he's estranged from the Democrats -- although nominally part of the caucus -- he's going to hang onto every dollar coming his way.

Once again the corporate state has subverted democracy. Public-interest politics continues to be hijacked by billions in campaign dollars that flow like effluent. Everybody outside of the power circles of K Street and boardrooms suffer as a result. Can we have meaningful reform in anything without disconnecting the big bucks lobbies from campaign funding?

You can crow all you want about letting the free market create competition and keeping government out of health care. Yet when it comes to votes in the most exclusive club on earth -- the U.S. Senate -- big bucks lobbies have cornered the market.

John F. Wasik is an investigative writer and author of The Audacity of Help: Obama's Economic Plan and the Remaking of America ( and The Cul-de-Sac Syndrome: Turning Around the Unsustainable American Dream.


1 comment:

Journey Home said...

If we get a compromise reform Bill through this Congress that extends coverage to millions of people, ends the pre-existing conditions exclusions, adds full insurance portability, makes it illegal for insurers to drop patients or raise their rates just because they get sick, repeals the anti-trust exemption, allows for national programs and gets the same prices congressmen and women get - as well as setting up exchanges to increase competition, then we will really have done something important.

Paul Burke
Author-Journey Home