Health Insurers Spent $173 Million To Defeat Public Option, Affordability Measures

In anticipation of the August recess, the health insurance industry is gearing up to oppose the four health care bills out of committee — and the GOP is cheering it on. “GOP aides on the Hill and Republicans on K Street” are urging America’s Health Insurance Plans (AHIP) — the insurers’ lobbying arm — “to get tougher,” Politico reports. “Hopefully, these guys will realize their approach hasn’t been working and will get into the game,” said a senior Republican aide on the Hill.

Answering the GOP’s call, AHIP’s director of strategic communications, Robert Zirkelbach, promised that the trade group is “going to be very active,” implying that the lobby is urging industry employees to “go to town meetings with members of Congress in August to confront them”:

We have people on the ground in more than 30 states. There are thousands of industry employees who have now had their integrity called into question. They want to have their voices heard as part of this.

Insurers are willing to accept limited government regulations (modified community rating, guarantee issue) — as long as all Americans under the age of 65 are required to purchase private coverage. In an interview with the New York Times, AHIP President and CEO Karen Ignagni “noted that the industry had endorsed many of the administration’s proposed changes, including ending the practice of refusing coverage for pre-existing conditions, and said it would work with lawmakers to develop a bill that did not include a public plan.” “The rhetoric that we are hearing is reminiscent of ’93, ’94, but we’re on the 2009 playbook,” she said, adding, “The inconvenient fact is that we support those reforms.”


Ignagni’s conciliatory tone obscures the lobbyist’s efforts to derail the public option and certain industry regulations. In her view, no entity — certainly not the government — should compete for the business of the uninsured; they are the private industry’s entitlement. Insurers spent “about $40 million on an army of lobbyists and lavishing campaign contributions on Democrats and Republicans to kill the public option. In all, the health industry spent $133 million in the second quarter alone, more than a million bucks a day.” According to the Wall Street Journal, insurers are also “pushing back against several proposals that lawmakers see as favorable to consumers. One proposal would prevent insurers from charging older Americans more than twice the rates charged to younger people. Insurers want to be able to charge older people as much as five times more.” WellPoint Inc., the nation’s largest insurance company, has set up an “online network where it makes the case against the public health insurance plan and urges consumers to contact their elected officials.”

The industry may not be re-playing the old ‘Harry and Louise ads,’ but it’s certainly twisting the legislation in its favor. If reports about the Senate Finance Committee’s bill are accurate — the bill will not contain a public option and would allow insurers to charge older Americans more than 7.5 times the rates charged to younger Americans — then the $173 billion the industry has spent on lobbying Congress was certainly a smart investment.