There is an old saying in Washington: “If you’re not at the table, you’re on the menu.”
According to the Center for Responsive Politics (CRP), the healthcare sector spent nearly $400 million in the first nine months of 2009 to have a seat at the table and lobby the federal government over healthcare reform.
The Billion Dollar Lobbying Effort
Add in the insurance industry’s $122 million, another $200 million spent on television advertising for and against overhauling healthcare and independent expenditures from the “527” advocacy groups and you quickly approach more than a billion dollars.
For all industries, 14, 808 lobbyists spent $3.3 billion teaching and, with a bit of sweat, influencing official Washington in 2008. The American Medical Association (AMA) and the insurance industry bought excellent seats at the table.
The Centers for Medicare and Medicaid Services (CMS) say we spend about $8, 000 per person on health care in the United States each year. The money spent on lobbying for health care would pay for one year’s worth of health care for 125, 000 citizens—roughly ten times the population of Warsaw, Indiana.
David Levinthal of the CRP told PBS’s Gwen Ifill on December 22 that the money spent on healthcare lobbying this year, “could potentially be…the biggest lobbying effort ever on a single piece of legislation the U.S. has ever seen.”
One of the reasons cited by Levinthal for the billion lobbyist bill is that this healthcare issue has been in play ever since President Obama took office early in the year. In addition, with 16% of the economy at stake, many players have a lot to lose or gain.
“When you have so many different entities vying for a piece of this pie, trying to control the trajectory of this legislation, trying to insert this or take out that, and the process lasts literally a year, that’s why you have these dollar figures that are really unprecedented, ” said Levinthal.
What’s the money buying?
In a word says Levinthal: Access. In other words, if you don’t pay, you don’t get a seat.
Once you’ve paid for your seat, you have to be heard. To get heard, the healthcare players hire lobbyists who are former Congressmen and staffers to make their case. The lobbyists in turn fund congressional campaigns.
Targeted Contributions
Healthcare lobbyists increase their effectiveness by strategically targeting their campaign contributions or the donations of the interests they represent. According to the CRP, health industry contributions to congressional candidates more than doubled this past decade, rising to $127 million in the 2008 election cycle from $56 million in the 2000 election, with disproportionate sums going to the party in power and to members of committees that oversee health care.
Campaign Contribution Leaders
CRP found that many senators in the healthcare debate have been among the top recipients of campaign contributions from health insurance and health-related companies, trade associations and groups.
Senate Majority Leader Harry Reid Announces Senate Passage of Healthcare Bill
Between January and September of this year, Senate Majority Leader Harry Reid collected the most from these interests via his campaign committee and leadership PAC, with $718, 575. During the same time, he also raised $252, 350 from labor interests.
- Senator Arlen Specter and
Vice President Joe BidenPennsylvania Senator Arlen Specter ranks second, with $562, 000 in contributions from health and health insurance-related interests during the first three quarters of 2009, in which he also collected $28, 500 from labor interests. - Senator Blanche Lincoln of Arkansas ranks third, with $561, 550 in such contributions between January and September. She’s raised $35, 600 from labor interests during the same period. Arkansas, according to the CRP, was one of the most targeted places for TV advertisements from both supporters and opponents of healthcare legislation.
Charles SchumerSenator Chuck Schumer collected $509, 500 from health and health insurance-related interests between January and September. In that time, he’s also collected $205, 000 from labor.- And finally, Senator Chuck “Sunshine” Grassley, the ranking member of the Senate Finance Committee rounds out the top five Senate recipients of health care campaign cash. Grassley collected $458, 500 from health and health insurance-related interests during the first three quarters of the year and has not collected any money from labor. (In fact, notes the CRP, he refunded one $1, 000 labor-related contribution.)
Revolving-Door Lobbyists
According to Bloomberg News, there are 3, 300 healthcare lobbyists registered to influence Congress. With 535 members of Congress, that’s about six lobbyists per lawmaker.
Of those 3, 300 lobbyists, more than 1, 400 used to work for Congress, the White House or federal agencies. Fifty-five are former lawmakers themselves and 166 are former aides from the congressional leadership offices and committees considering the healthcare bills.
Government employees and lawmakers make a fraction of what lobbyists get paid. With a revolving door of staffers and lawmakers joining lobbying firms, the guests at the table resemble a large incestuous family.
Congressional salaries currently top out at $174, 000 annually for lawmakers and $156, 000 for aides, though committee staff members can earn slightly more.
Said Levinthal,
If you do come in and you have…working on your behalf former members of Congress or former high-ranking congressional staffers, that’s certainly going to help your case. And so many clients who employ lobbyists are hiring people who have worked in Congress before, because they know the system. They know the players. And they are intimately familiar with the issues. So, all these things put together are very expensive, but they also can definitely pay dividends for the people who are hiring the lobbyists.
Alan Abramowitz, an Emory University political scientist told the Chicago Tribune recently, “There’s always a worry they may be thinking about their future employment opportunities when dealing with these issues…”
AdvaMed at the Table
One example of a former insider is AdvaMed’s Senior Vice President David Nexon who was a staffer for the late Senator Edward Kennedy.
AdvaMed’s David NexonNexon and AdvaMed took the lead in lobbying against a proposed $40 billion medical device tax in the healthcare bill spread out over the next ten years. AdvaMed and Nexon’s efforts, along with objections from Senators from medical device-heavy states like Indiana and Minnesota, got the device tax lowered to $20 billion over ten years.
This revolving-door culture wouldn’t raise concerns if there was a clear and transparent picture of all the relationships. As we recall, Senator Grassley of Iowa demands the same of surgeons and device companies.
What lawmakers preach is not what they practice.
“Sometimes you don’t know what the effect has actually been by the lobbying efforts, ” said Levinthal. “That’s because the laws don’t allow you to find out, for example, who has actually lobbied whom. So, if you want to find out, for example, if a lobbyist for a large healthcare firm has spoken to Max Baucus or Joe Lieberman or this senator or that congressman, you’re not going to be able to find that out, because it’s not federally required for the client of the lobbyist to disclose that.”
AMA Versus Surgeons
So are physicians at the table or on the menu?
It depends. A schism has opened between the AMA and surgeon societies.
The American Medical Association definitely paid for its seat at the table. AMA supported the healthcare measure passed by the Senate on Christmas Eve and it is one of the top political action committees to make campaign contributions.
In the last ten years, the AMA was outspent only by the U.S. Chamber of Commerce in lobbying expenditures, spending over $212 million over that period of time. The American Hospital Association, the Pharmaceutical Research and Manufacturers of America, and AARP round out the top six spenders. (General Electric was the other.)
What has the AMA gotten for its money? The AMA supports the legislation because it increases the number of people who will be insured for receiving healthcare. It is also maintaining its monopoly on reimbursement codes and will see its members who are primary care physicians see higher reimbursements. What it didn’t get was a permanent fix to the flawed Medicare reimbursement formula.
What about the orthopedists and spine surgeons?
The surgeons may feel like they are on the menu because they oppose the legislation passed by the Senate. They fear access to their specialty services will be reduced at the expense of primary care services.
A look at the top political actions committees on the CRP Web site shows the AMA, dentists and ophthalmologists are the largest healthcare provider contributors. There is no sign of the orthopedic and spine societies in the top 50 lists of campaign contributors.
Congress will have to finish its healthcare bill when it returns from the holiday recess. So far the apparent winners have paid their way fair and square to decide who will be on the menu. The AMA and surgeons will have a lot of sorting out to do after the feast is over.
