Why Do So Many Grassley Amendments Benefit The Health Care Industry?

Most of the Republican amendments to Sen. Max Baucus’s (D-MT) mark seek to obstruct legitimate debate, but Sen. Chuck Grassley’s (R-IA) amendments suggest that the ranking member of the Senate Finance Committee won’t support reform legislation that undermines interests of the health care industry.

Grassley, who has spent his entire summer attacking reform legislation, has offered at least 10 amendments that would directly benefit the health industry, of which he is the top recipient of campaign contributions. According to an analysis of records compiled by the Center for Responsive Politics, Grassley received the most health industry contributions this year — $223,600. Sen. Max Baucus (D-MT) was second with $141,000.

While “there is not a quid pro quo,” Sheila Krumholz, executive director of the Center for Responsive Politics explains, “there is an expectation that a contribution gives you a chance to be heard by the member.” Approximately one-third of Grassley’s amendments benefit the industry.

Three separate amendments aim to protect government’s subsidy of private insurers participating in Medicare Advantage. As a senator from a rural state, Grassley is sensitive about ensuring that his constituents have access to health care services, but his devotion to the 13% subsidy undermines the stability of the broader Medicare program, from which 88% of Iowa Medicare enrollees benefit. Traditional Medicare is actually less expensive to administer and is no less effective than private plans in Medicare Advantage. In fact, according to a Government Accountability Office private plans in Medicare Advantage channel the extra payments into profit, not improved benefits.

Four Two of Grassley’s amendments replace the individual mandate to purchase coverage with a reinsurance policy that would allow insurers to pay into a “reinsurance fund” that would finance very high medical expenses. Without an individual mandate, reinsurance could protect the entire insurance pool from picking up the costs of individuals who purchase coverage after a crippling diagnosis. While ‘reinsurance’ does contradict AHIP’s public embrace of the individual mandate, the scheme would benefit private reinsurance firms (some of which are AHIP members).

Grassley also offers four separate amendments to eliminate fees on health insurance providers, medical device manufactures, clinical laboratories, and manufactures and importers of branded drugs. The industry strongly opposes this fees and is lobbying Congress to eliminate them.