Roll Call reports that a new group called “Partnership for America” has announced a $3 million campaign to repeal health reform. The stated goal is to “‘freeze, investigate and replace’ the health care law known as the Patient Protection and Affordable Care Act.”

The website for the group describes itself as a “grassroots” uprising to “ensure a new era of American greatness.” But an examination of the group’s backers reveals more of the same: health care industry consultants using a front group with a lofty name to accomplish a corporate lobbying goal.

Kaiser Health News reports that the team behind the Partnership for America includes former Republican bureaucrats-turned-industry lobbyists Bob Wood, James Capretta, James Wootton and Chuck Cooper. The leadership biography page on the Partnership for America website lists the men involved, but makes significant omissions about their current lobbying clients that stand to benefit from the group’s irresponsible repeal campaign:

– Partnership for America leader Bob Wood is a lobbyist whose portfolio of clients include Eli Lilly, Pharmaceutical Research and Manufacturers of America (better known simply as PhRMA, a lobbying association for drugmakers), Select Medical, and XL Health Corp, a Medicare Advantage provider.

– Partnership for America leader James Capretta is no longer a registered lobbyist, but is currently listed as a “Principle” at a government affairs firm that represents health insurers like CIGNA, UnitedHealth, and America’s Health Insurance Plans (a trade association for the entire health insurance industry).

Other Partnership for America leaders, like James Wootton and Chuck Cooper, have a history of working for health care industry-related interests. Wootton was a former lobbyist for and an official at the U.S. Chamber of Commerce, a trade association with a sordid past of secretly funneling health insurance cash into far right anti-patient and anti-health reform causes. Cooper is an attorney at a law/lobbying firm with an active health care practice that has counted PhRMA as a client in the past.

Fronts like the Partnership for America thrive when media outlets report on them as bonafide citizens groups. It doesn’t appear that there is anything authentic about the organization. Even the office location listed for the group is actually an anonymous mailbox/corporate conference room service two blocks from K Street.

In California, Democrats in the legislature proposed a bill to add greater oversight over the health insurance industry. The rate regulation bill, proposed by Assemblyman Mike Feuer (D-Los Angeles), would have allowed the Insurance Commissioner to review rate hikes proposed by insurers, and block hikes if they are without justification.

The bill, which mirrors similar policies for the auto insurance industry and health rate review laws in other states, died a sudden death yesterday as health care industry lobbying intensified:

Groups representing insurers, hospitals and doctors lobbied against the bill, saying the regulations would add bureaucracy and do nothing to address high and fast-rising medical costs that help drive rate increases. Ultimately, they argued, rate regulation could reduce access to care.

As ThinkProgress reported back in June, health insurers mobilized opposition through a number of third party groups funded by health insurers and other health care industry businesses. For instance, the California Chamber of Commerce slated Feurer’s bill, AB 52, as a “Job Killer,” but obscured the fact that Kaiser Health Plans, UnitedHealthcare of Southern California, and Anthem Blue Cross of California are major donors to the Chamber’s political coffers.

Although Feurer’s bill is dead for now, the fight has not yet ended. Next year, advocates will push again for the bill, which passed the Assembly earlier this year and died due to obstruction in the Senate.

Rate regulation might also see momentum in the form a ballot initiative drafted by California Watchdog for the polls next year. According to reports, California Watchdog’s rate review initiative would not only include elements of Feuer’s bill, but also require a 20 percent rollback of existing rates. “We’re preparing an initiative to be ready to go on health insurance reform if we’re not able to get satisfactory results in the Legislature,” said Doug Heller, executive director of the group.

The San Francisco Chronicle is reporting that Kaiser Permanente plans to raise rates by more than 10 percent for about 300,000 Californians enrolled in policies offered through small businesses. Kaiser Permanente, which operates as a quasi-nonprofit, has reported record profits of $921 million in the first quarter of 2011 alone. The company reportedly has healthy reserves, and has filed disclosures noting that it has rewarded top executives with million-dollar bonuses in recent years.

While public outcry temporarily stalled California insurers from forcing through egregious rate hikes last year, pending legislation may provide a better path. This week, the California state Senate is expected to vote on AB 52, legislation sponsored by Assemblyman Mike Feuer’s (D-Los Angeles) to allow regulators to review proposed rate hikes by health insurance companies. However, California health insurance companies are fighting back with an onslaught of lobbying.

Like the national legislative battle over President Obama’s health reforms, insurance companies in California are attempting to undermine AB 52 by showcasing widespread opposition to the bill. The California Association of Health Plans — the trade association representing major insurers in the state like Kaiser Health Plans, Anthem Blue Cross (WellPoint), Aetna, UnitedHealth, HealthNet, and Cigna — is leading the charge, firing off press release after press release noting the “diverse group” of California organizations against the rate review bill. However, a closer look at the groups the insurers are touting reveals multiple financial ties to insurers opposed to AB 52:

– The California Chamber of Commerce has announced that AB 52 is on the top of its list of “Job Killers,” meaning they will make killing the legislation a top priority. The Chamber purports to represent all businesses in the state, but its board membership reveals mostly multinational corporations. Health insurers have a seat at the table. California Chamber board members include Greg Adams, a top Kaiser Health Plans official, David Anderson, CEO of UnitedHealthcare of Southern California, and Pam Kehaly, President of Anthem Blue Cross of California. Diamond membership to Chamber requires annual dues of at least $100,000, suggesting that top insurers have funneled hundreds of thousands of their customers’ premium money to a right-wing lobbying group, rather than spending it on actual medical services. Although the Chamber has not registered with the Secretary of State for grassroots lobbying, the Chamber’s e-lobbying platform is calling for members to contact legislators to oppose the bill.

– The Pacific Research Institute (PRI), a conservative think tank based in San Francisco and Sacramento, has attacked the legislation. PRI fellow John Graham has claimed there is “little or no evidence” rate review provides relief to consumers. In fact, numerous studies, like this one from Families USA, have found broad benefits to consumers through rate reviews instituted in other states. Perhaps PRI’s opposition is partially rooted in the fact that Michael Carpenter, a top lobbyist for Kaiser Health Plans, is a former board member of the group who has been featured at PRI events.

– A number of the other local chambers of commerce touted as opponents of AB 52 are funded by health insurance companies. For example, the Los Angeles Area Chamber of Commerce receives annual donations of at least $50,000 from Kaiser Health Plans.

– The Civil Justice Association is paraded around as an opponent of the AB 52. Health insurers like Kaiser Health Plans and Anthem Blue Cross are among the dues-paying board members.

ThinkProgress has learned that the lobbying firm Fiona Hutton and Associates has been charged with helping to recruit and push these insurer allies.

Earlier this month, Los Angeles Times columnist Mike Hiltzik absolutely eviscerated the policy arguments insurers have advanced to discredit AB 52. But policy arguments are only part of the equation when it comes to legislative debates. According to disclosures filed with the state, health insurers like UnitedHealth, Cigna, and Anthem are hiring top Sacramento lobbyists and pouring more than $1 million dollars into lobbying. As the Courage Campaign highlighted in a recent letter, despite its registration as a nonprofit, Kaiser is spending vast amounts of money on direct lobbying as if they were a normal for-profit insurer. Sadly, the searchable donations reveal only part of the picture. Health insurers have not only purchased lobbyists with their customers’ premium money, they have purchased friends to build their anti-AB 51 “coalition.”

Throughout the health care reform debate, Congressional Blue Dogs lobbied then-House Speaker Nancy Pelosi (D-CA) to adopt provisions that would lower health care spending and reduce the deficit, but curiously opposed the so-called robust public option. That measure reimbursed providers 5 to 10 percent above Medicare rates and would have reduced the deficit by as much as $110 billion over 10 years. In July of 2009, the fifty-member Blue Dog Coalition wrote a letter to Pelosi revealing “strong reservations” about an earlier House version of the health care bill. “After reviewing the draft tri-committee health care reform proposal, we believe it lacks a number of elements essential to preserving what works and fixing what is broken,” they wrote, noting:

A “Medicare-like” public option would negatively impact hospitals, doctors and patients…using Medicare’s below-market rates would seriously weaken the financial stability of our local hospitals and doctors.”

That argument was debunked repeatedly by MedPAC — which argued that Medicare rates are adequate and consistent with the efficient delivery of services — and relied heavily on insurance industry talking points. The industry feared that it would lose market share if forced to compete against a more efficient public plan. In March 2009, he industry’s chief lobbying arm, AHIP, provided lawmakers with this presentation, ‘What you should say when asked about the public option“:

You could end up not being able to see the doctor of your choice as the government plan would reimburse doctors so little for their services they stop accepting or dropping patients by the government plans.

And so, given all this, it is perhaps not surprising that today’s Politico Pulse reports that Erik Komendant, the policy director for the Blue Dog Coalition, has now accepted a job at AHIP as “VP for federal affairs.” After all, it’s like he was working for them already.

The health sector has kept quiet throughout the GOP’s futile effort to repeal the Affordable Care Act in the House, saving its ammunition for the more serious campaign of changing and tweaking parts of the law. This morning Karen Ignagni, the insurance industry’s chief spokesperson, offered a glimpse into what insurers will be lobbying for in the months and years ahead. She hinted that the industry isn’t interested in repeal and is instead focusing on the following issues. Watch it:

Let’s go through it piece by piece:

- Eliminating new taxes on the health insurance industry: Beginning in 2014, the health law imposes an annual fee on the health insurance sector, but Ignagni refers to this as “an unprecedented sales tax on small businesses and individuals” — “a health care sales tax.” Unless the industry offsets the increase through innovation, some of the costs may be passed down to employers and employees — but both of these groups will be receiving tax credits to offset the purchase of coverage. Generally speaking, in a law that pays for its coverage expansions and reduces the deficit, somebody has to pay more if others get more.

- Wants to charge younger people more for insurance: Ignagni claims that “anyone under 40 would see a huge increase” in costs and the industry has already been lobbying the Department of Health and Human Services to adopt a transition period for the age-rating provision of the Affordable Care Act. Under the law, beginning in 2014, insurers will have to guarantee coverage to everyone who applies and charge older people no more than three times what younger individuals would pay. But the industry is saying that if it had to adopt that change instantaneously in January of 2014, younger individuals would face big price increases. This argument isn’t particularly convincing, however, since many young people will actually pay less for coverage because they’ll qualify for subsidies and possibly even Medicaid. That will significantly increase participation among young adults, improve the risk pool, and probably outweigh any negative effects due to age rating. My post on that here.

- Essential benefits packages should be very narrowly defined: Ignagni claims that “if the essential benefit package is so broadly structured that these individuals and small businesses are going to find that the current proposals are unaffordable and they’re going to have to buy up, that is going to be a third leg of the stool in terms of cost increases. ” While there is a reasonable argument that regulators shouldn’t overfill the minimum benefit package and give insurers flexibility in design, you don’t want them to have so much flexibility that they can “continue to compete based on risk-selection, rather than price and quality as intended by the ACA and what is critical for a better functioning health insurance market.” My post on that here.

During the interview, Ignagni was also asked about Wendell Potter’s new book criticizing the industry and its PR practices. Ignagni — who Potter describes in the book as an incredibly effective spin-master — said she hadn’t read the book and didn’t address Potter’s accusations.

The Affordable Care Act prevents health insurers from cherry picking only the youngest and healthiest applicants by requiring insurers to accept anyone who applies without regard for prior conditions and charge applicants a modified community rate. But the industry is now trying to work its way around this goal and is lobbying the government for more flexibility in designing benefit packages:

America’s Health Insurance Plans and the Blue Cross Blue Shield Association both said in their comments that HHS should tread lightly when defining essential benefits, saying an overly broad policy could raise costs and make the process more confusing for consumers. “General principles and criteria should allow for plan innovation and flexibility to meet evolving market and consumer needs,” BCBSA stated. And AHIP said HHS should “only seek to identify general categories of care, rather than specific health care services.” [...]

But a health policy expert who reviewed the industry groups’ comments said too much flexibility could lead to adverse selection. If the regulations on essential benefits are too lax, the source said, insurers would be able to design their plans to appeal to healthy patients. She said that if HHS only sets broad principles for an essential benefit, leaving it largely to individual plans to determine which services meet those principles, plan design would become a tool for the same type of underwriting that health reform otherwise curtails or prohibits.

Indeed, if one designs a health plan without coverage for an expensive treatment or condition, patients who suffer from that particular ailment will go elsewhere for coverage. Conversely, a plan that offers discounts for gym memberships and focuses on primary care and prevention and is light on everything else, will likely appeal to healthier (read: less expensive) individuals. Given too much latitude, insures have an economic incentive to design the more profitable plan.

As the Center on Policy and Budget Priorities’ Edwin Park put it, “While there is a reasonable argument on the part of insurers that they continue to retain flexibility to design benefits that can improve quality while lowering costs (i.e. value-based insurance design based on comparative effectiveness research), you don’t want them to have so much flexibility that they can continue to compete based on risk-selection, rather than price and quality as intended by the ACA and what is critical for a better functioning health insurance market. ” He added that beneficiaries “wouldn’t want a particular plan claiming it covers one of the enumerated essential benefits like inpatient care and only cover one hospital day, or cover prescription drugs except for all the drugs used by people with HIV/AIDS, cancer, severe heart disease, or certain chronic illnesses like diabetes, etc, or charge much higher co-payments or co-insurance for certain higher cost services required by people in poorer health.”

Of course, all of this is a ways away, but it’s worth reiterating that while the legislative fight may be over, the various interest groups are now gearing up for ways to shift the law in their favor. For their part, insurers are already lobbying to, among other things, delay lowering rates for older people.

This Ben Smith post really ties together the two arguments I made yesterday, namely that health insurers are extremely effective in shaping public opinion and that Fox News began referring to the public option as the government option to help sink reform, not offer a better explanation of the provision. As it turns out, that phrase first originated not with Fox or Frank Luntz, but AHIP — the insurance lobby powerhouse that shaped much of the law to its liking:

A former Republican Hill staffer closely involved in the battle over the health care plan — and concerned that credit go where it’s due — e-mails that the case for the linguistic shift first emerged in February in research provided the GOP by the health insurance industry group America’s Health Insurance Plans (AHIP).

AHIP focus groups from late February (whose findings appear in this document, provided by the former aide) found that voters like the idea of a “public” plan, and that the most negative term is a “government-run health insurance plan.”

A round of polling from AHIP in February and March confirmed that argument. “It is clear the most negative language to use when describing a ‘public plan’ is ‘a government-run health insurance plan,’” reads a presentation the group distributed, starting in March, to allies, Republican staff and opinion leaders and to conservative media, according to the former aide.

Sen. John Ensign was the first to pick up the talking point in a March 24 release blasting a “Government-Run ‘Public’ Health Insurance Plan.”

This is fairly significant because it once again reaffirms the existence of a messaging pipeline which stretches from the industry to the lobbyist to the lawmaker and to Fox — and not necessarily in that order. The effectiveness of this communication system was on full display during the health care debate, when Republicans went to the floor and literally read from the industry-sponsored critique of the health law and then again echoed their arguments about the causes of premium increases after the law passed. None of this happened through some coincidence or a meeting of the minds. More likely than not, Republicans and their friends in the media were reading from talking points they received directly from the industry.

But the industry’s influence stretched far beyond the phrase “government option.” Insurers went to great lengths to develop messages that shifted public perceptions against the provision. As this AHIP presentation demonstrates, almost all of the following phrases became standard Republican talking points against reform — and they came straight out of the industry’s polling:

In his book Deadly Spin, Wendell Potter explains how this process works through the help of public relations firms and a mass distribution of information to friendly news outlets (read: Fox News) and conservative think tanks who then place favorable editorials in the country’s leading newspapers. This example deserves a prime spot in the book’s second edition, which, with some more investigative work, could contain whole treasure trove of anti-reform phrases and talking points that originated with AHIP.

Read AHIP’s research on the ‘public option’ here and see their presentation here.

In Deadly Spin, insurance insider Wendell Potter describes how insurers rely on public relations firms to handle moments of crisis. The industry brought on APCO to discredit Michael Moore’s SICKO, worked with PR companies to shape their message during the health reform debate and consulted these companies when dealing with a death of a beneficiary to whom it had denied treatment. As Potter explains it, these groups have the contacts and the know-how to distribute industry talking points to editors, columnists, think tanks and reporters in a way that distorts their origin and boosts their legitimacy.

This approach is very effective in shifting public opinion and perceptions. The final health care law was fairly similar to AHIP’s original plan and it’s likely that the industry’s attack ads (funneled through the Chamber of commerce) and slew of negative made-to-order reports about reform probably had some impact in shifting the bill further to the right. With that said, it’s troubling to see that the industry is now re-grouping and looking for new PR representation as it moves into the all-important implementation phase of reform:

Five of the nation’s largest health insurance companies are taking a key step toward building their own inside-the-Beltway coalition to influence implementation of the new health law and congressional efforts to change it. The companies – Aetna, Cigna, Humana, UnitedHealthcare and Wellpoint – are shopping around Washington for a public relations firm to represent them, according to a source familiar with their work. Public Strategies and APCO are among PR firms that have spoken with the insurers, the source said.

“They plan to go public,” the person said. “They spent a ton of money [in 2009 on lobbying and the election] and liked being influential and they don’t want that to go away.”

The unfortunate thing for advocates of health reform is that with a Republican Congress — which came into power with the help of contributions from the industry — influencing the debate shouldn’t be terribly difficult, particularly when HHS is already “expanding quality bonuses to Medicare Advantage plans that receive only average quality ratings.” Agreeing, in other words, to the industry’s demands before they even settle on their PR representation. Imagine the other provisions insurers will be able to successfully water down if there isn’t serious push back on Capitol Hill and the advocacy community.