PNHP

Biotech lobbyists cast their nets

Biotech lobbyists cast their nets

Biotech firms lobby for say on healthcare

$66m effort to protect drug-patent exclusivity

By Lisa Wangsness
The Boston Globe
July 21, 2009

The 46 million Americans without health insurance are probably not spending much time thinking about how Congress should curb monopolies on expensive biotech drugs. But the issue, which offers a case study in the ways of Washington influence, is among dozens that have spurred a lobbying frenzy this summer as Congress debates a historic healthcare overhaul.

Pharmaceutical interests alone, including many from Massachusetts, spent more than $66 million on lobbying in just the first quarter of this year, up 25 percent from last year, according to the nonpartisan Center for Responsive Politics.

Biotech firms produce the most expensive drugs on the market, charging $10,000 to $100,000 a year for a single patient, and generics would seriously undercut those prices. In their quest to win a 12-year exclusivity period for their drugs, free from such competition, biotech companies have launched a massive education campaign about what they say are the sky-high research and development costs involved with bringing them to market.

To help carry the message, they are paying well-connected lobbying firms, sponsoring radio ads as well as academic studies, and contributing to the campaign coffers of influential lawmakers.

“You get one crack at it,” said Robert Coughlin, president of the Massachusetts Biotechnology Council, speaking of the task of drawing up a licensing system for “biogenerics.” “If it isn’t done right, it could literally put the biotech industry out of business.”

The quest for influence is not always obvious.

Howard Dean, the former Democratic Party chairman, wrote an opinion piece this month in The Hill, an influential Capitol Hill newspaper, arguing that fewer than 12 years of monopoly rights for biotech companies’ products “would prematurely rob innovators of their intellectual property and . . . destroy incentives to develop new cures.”

Within hours Joe Trippi, a Democratic consultant who ran Dean’s 2004 presidential race, hyped Dean’s opinion piece in a blog post that he sent to The Huffington Post, a widely read website. “He’s a doctor and lifelong advocate for health reform – he knows what he’s talking about,” Trippi wrote, urging readers to contact their lawmakers.

Dean failed to note in his editorial that he is an adviser to McKenna, Long & Aldridge, a global law firm that is advising the Biotechnology Industry Organization, the influential trade group. Nor did Trippi mention that his public relations firm handles social media projects in a partnership with the Boston public relations company Brodeur Partners, which also has BIO as a client.

Dean said his editorial was part of McKenna’s rapid-fire response to an unexpected, eleventh-hour Senate health committee proposal (which biotech firms ultimately fought off).

“It was a huge scramble, all hands on deck,” Dean said.

The legions of lobbyists, strategists, and legal consultants involved include former senior aides to key lawmakers and executives. Top biotech companies are clients of Foley Hoag, a law firm with offices in Boston and Washington, which has deployed Nick Littlefield, former staff director and chief counsel for Senator Edward M. Kennedy’s health committee, and Paul Kim, the former deputy health counsel to the Kennedy’s committee.

Biotech won a major battle last week when Kennedy’s Senate health committee gave biotech firms the 12-year protections they wanted, plus six months for pediatric versions. The committee rejected a proposal by Senator Sherrod Brown, Democrat of Ohio, for a much shorter monopoly period. After the vote, generics companies said they wouldn’t even bother trying to make generic biologics because the 12-year protection would make the enterprise unprofitable.

“The pharmaceutical industry, especially the biotech industry has an awful lot of power in the halls of Congress,” Brown told reporters.

State leaders from around the country, including Governor Deval Patrick, wrote letters to their delegations supporting a biotech-friendly bill. CEOs have flown to Washington to drive their points home. The Globe reported earlier this year that Amgen donated $1 million to the Edward M. Kennedy Institute for the United States Senate at the University of Massachusetts Boston, a project being developed by people close to the senator but not Kennedy.

In the health committee vote last week, a number of other left-leaning Democratic senators sided with the industry, including Patty Murray of Washington, Barbara Mikulski of Maryland, Jack Reed and Sheldon Whitehouse of Rhode Island, and Kay Hagan of North Carolina. Kennedy supported the measure by proxy.

Hagan, a freshman senator whose state is home to a biotech sector, was assigned to the health committee this winter. Few were surprised when she cosponsored the industry-friendly amendment. But biotech firms were not taking chances: In the first half of this year, they poured $16,000 into her campaign account. Hagan believes the protections are necessary to support research for new drugs.

http://www.boston.com/news/health/articles/2009/07/21/biotech_firms_lobby_hard_for_say_on_healthcare/

July 14 qotd on the 12-year data exclusivity amendment:
https://pnhp.org/news/2009/july/senate_help_amendmen.php

Comment:

By Don McCanne, MD

The vote on the data exclusivity amendment was covered in a qotd last week, at the link above. More background information is provided by Lisa Wangsness in her Boston Globe article. Because of the implications for the reform process unfolding in Washington, we are taking a second look.

Having a twenty year patent on a biological that can command a one hundred thousand dollar price tag is not enough for the biotech firms. They also want a 12 year lead time before competitors can begin to use the data, produced in our academic medical centers, for developing new innovative drugs or even generic equivalents. This doesn’t change the 20 year patent exclusivity, but it requires future competitors to wait 12 years before beginning their research that would be based on the existing data.

That slows future innovation and research. It slows the introduction of generics that can result in competitive pricing. It decreases the chance of breakthroughs that could replace a one hundred thousand dollar biologic with a two hundred dollar product that might be more effective and less toxic.

Watching the prolonged committee deliberations on the 12 year data exclusivity amendment, it was obvious that the arguments presented by the senators in support of this amendment had been written by the biotech lobbyists. It was also obvious that only a few of the senators had rejected the lobbyists’ overtures.

The Boston Globe article demonstrates that this was not about policy, but about process. It shows how the most powerful lobbyists can cast their nets and pull in the best of them.

Howard Dean was a part of the “all hands on deck” scramble to support the data exclusivity amendment. It was simply a job that he was expected to do as part of the McKenna rapid-fire response team.

It was particularly painful to watch Senator Dodd, acting chairman of the Senate HELP Committee, cast an aye vote by proxy on behalf of Sen. Ted Kennedy, even though Sen. Dodd had already cast a no vote on his own behalf. It would be unfair to speculate what may have caused Sen. Kennedy to communicate his wishes on that vote, but it is likely that Amgen feels that they paid a million dollars for that vote, fair and square.

Does anyone else agree that we need a fully transparent re-start on reform?

Drug Makers Score Early Wins as Plan Takes Shape

By ALICIA MUNDY and LAURA MECKLER
The Wall Street Journal
JULY 17, 2009

WASHINGTON — The pharmaceuticals industry, which President Barack Obama promised to “take on” during his campaign, is winning most of what it wants in the health-care overhaul.

The final contours of the legislation are far from settled, but the industry, led by a onetime powerful congressman, has notched a string of victories.

Legislation expected soon in the powerful Senate Finance Committee will leave out cost-cutting steps as part of an agreement with the industry and the White House, according to Congressional aides, industry lobbyists and others involved in the talks.
[a hefty dose]

The missing items include two planks of Mr. Obama’s campaign platform: allowing cheaper drugs to be imported from Canada and giving the federal government the right to negotiate Medicare drug prices directly with pharmaceutical companies.

While the industry has engaged in vigorous lobbying just as Mr. Obama took office, that alone doesn’t explain all the success. Reimportation and Medicare drug-price negotiation are largely symbolic and Congressional researchers have said they won’t save much money in the long run.

Meanwhile, a separate Senate committee voted this week as part of its health bill to give branded biotechnology drugs at least 12 years of market exclusivity, a defeat for makers of cheaper copycat medicines. “This is the best year the drug industry has had in decades,” said Nancy LeaMond of AARP, the seniors’ lobby, which is seeking greater price-cutting on drugs.

Pharmaceutical firms say cutting drug prices would hurt innovation and make it harder to bring new medicines to market, and say they are making sacrifices as part of the health-care overhaul.

Last month, the industry agreed to what Mr. Obama touted at the White House as $80 billion over 10 years in give-backs to help pay for expanded health insurance. About $50 billion of the total is available to help pay for the overhaul, expected to cost $1 trillion over a decade.

The remainder comes from an agreement to sell more brand-name drugs to certain Medicare beneficiaries at a 50% discount — which saves those seniors money but also generates new business for the industry. White House spokeswoman Linda Douglass said the deal represented “an unprecedented commitment” from “an industry that has opposed health-reform efforts in the past.”

The pharmaceuticals industry has a war chest it can use either to back a health-care bill or rally public support against it.

Already radio spots helped secure congressional support for extended protection for biotech drugs.

If Mr. Obama retreats on some drug-industry issues, it might help him land a much bigger prize: a broad health-care bill. “The motivation for the White House and Finance Committee is to take PhRMA and its money out of any possible opposition, and that’s really what’s driving these agreements, along with the desire to get financing for the bill,” said John Rother, another AARP lobbyist, referring to the Pharmaceutical Research and Manufacturers of America. “Think about who has money enough to cause a problem.”

On Thursday, PhRMA and the liberal group Families USA unveiled television ads featuring “Harry and Louise,” the fictional couple in ads that helped defeat health legislation during the Clinton administration. In the new ads, the couple now favors a health overhaul.

PhRMA didn’t respond to requests for comment on its ad strategy.

Some Democrats, including Mr. Obama, have pushed Congress to establish a pathway for generic biological drugs. But the Senate health committee voted this week to give biologics 12 years of market exclusivity — separate from any patent protection they might enjoy. The White House had proposed seven years.

Last month, when it seemed that the bill would be more favorable to generics, Watson Pharmaceuticals Inc., a big generics maker, announced the acquisition of Arrow Group of Europe for $1.7 billion as a platform to develop biologics. “Now we have to rethink our strategy,” said Watson Chief Executive Paul Bisaro. “We’re all very disappointed.”

In a statement, the Biotechnology Industry Organization said the 12-year window is a “fair and reasonable period to ensure continued biomedical innovation.”

PhRMA is headed by former Republican Rep. Billy Tauzin, who was chairman of the House Energy and Commerce Committee and began reaching out to Democrats shortly after Mr. Obama was elected.

He was among the first people in the health-care industry to sit down in negotiations with the administration when it took office. That effort came to fruition with the June announcement of the $80 billion deal. “I think they probably are the most effective and well-financed health stakeholder group in the country,” said Ron Pollack, president of Families USA.

The House bill includes about $30 billion more in cuts to the drug industry than the Senate version, according to calculations by outside analysts. It also contains one particular measure that drug companies don’t like. When the Medicare drug benefit went into effect, certain seniors who were getting drug coverage through Medicaid moved on to the new Medicare program. “It was like a $2 billion-a-year windfall for drug companies,” said Rep. Henry Waxman (D., Calif.), because Medicare prices are higher.

The House bill proposes rebates that would take back that money, but the Senate Finance Committee left that out, and the White House declined to say whether it supports the effort to impose the rebates.

The Finance Committee had proposed using this policy as a stick to make sure that drug companies gave seniors the 50% discount they were promising as part of the $80 billion deal.

Drug makers found that objectionable, and the announcement of the agreement was delayed for 48 hours while they found another enforcement mechanism, according to one lobbyist involved.

Write to Alicia Mundy at alicia.mundy@wsj.com and Laura Meckler at laura.meckler@wsj.com

Is restraining federal health care spending the goal?

Hearing: The Long Term Budget Outlook

Senate Budget Committee
July 16, 2009
Sen. Kent Conrad: Dr. Elmendorf, I’m going to really put you on the spot because we’re in the middle of this health care debate, but it’s critically important that we get this right. Everyone has said, virtually everyone, that bending the cost curve over time is critically important and one of the key goals of this entire effort. From what you have seen from the products of the committees that have reported, do you see a successful effort being mounted to bend the long term cost curve?
CBO Director Douglas Elmendorf: No, Mr. Chairman. In the legislation that has been reported we do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount, and on the contrary, the legislation significantly expands the federal responsibility for health care costs.
****
Sen. Judd Gregg: Well, Mr. Director, your testimony has been sobering today… The present plans as they’ve been produced have no significant cost spending events in them relative to reimbursement and relative to the way that they structure health care, that most American’s premiums aren’t going to go down and they will continue to go up, and that the debt of this country is unsustainable on our present course, and there isn’t a whole lot in this health care debate to date relative to the bills that have been produced that is going to do anything but continue to aggravate that and actually expand that problem. That’s my summary of what you’ve said. Is that a reasonable summary?
Douglas Elmendorf: … on the summary of the sobering perspective, yes, I agree with that, Senator. I’m sobered by having to give it.
http://budget.senate.gov/democratic/hearingstate.html

Is the health care cost debate limited to concerns about federal spending on health care, or is it about total health care spending? The distinction is very important because, if policies are limited to slowing the increase in the rate of federal health spending, many of those policies simply transfer costs from the government to individuals and businesses. It will give us little consolation to see the health care component of the federal budget in balance if individuals and businesses can’t afford health care.
It is informative to note that Chairman Conrad asked about products of the committees that would bend the long term cost curve, presumably the curve of the growth in our national health expenditures, and CBO Director Elmendorf’s response was limited to the trajectory of federal health spending.
Deficit hawk Gregg has continued to pound on the projected unsustainable growth in Medicare and Medicaid spending, and he is right that we should be concerned. But again, instead of policies that would merely shift costs out of the federal budget and on to individuals and businesses, we need policies that would reduce total health care cost increases to sustainable levels for everyone. This is what is interesting about Sen. Gregg’s question and Dr. Elmendorf’s response. They have concluded that the current legislative proposals are not going to have a significant impact on the upward trajectory of total health care costs.
It is unfortunate that the one measure that both indicated would be a very important policy to adopt would be to end the deductibility of employer-sponsored health plans. That helps with the federal budget, but it further increases health care costs for businesses and their employees.
For those who are very concerned about future federal deficits, there is a solution. Simply remove health care costs from the federal budget. Projections of future budget spending have been shown to be fully sustainable if health care costs are left out. Then set up a separate budget for health care financed through an equitably-funded universal risk pool.
President Obama has stated repeatedly that we must control health care costs as the first priority, and then we can cover everyone. The current proposals do neither. But with a single risk pool, and with the monopsony power of our own public administration we would be able to ensure health care value for absolutely everyone.

Is restraining federal health care spending the goal?

Hearing: The Long Term Budget Outlook

Senate Budget Committee
July 16, 2009

Sen. Kent Conrad: Dr. Elmendorf, I’m going to really put you on the spot because we’re in the middle of this health care debate, but it’s critically important that we get this right. Everyone has said, virtually everyone, that bending the cost curve over time is critically important and one of the key goals of this entire effort. From what you have seen from the products of the committees that have reported, do you see a successful effort being mounted to bend the long term cost curve?

CBO Director Douglas Elmendorf: No, Mr. Chairman. In the legislation that has been reported we do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount, and on the contrary, the legislation significantly expands the federal responsibility for health care costs.

****

Sen. Judd Gregg: Well, Mr. Director, your testimony has been sobering today… The present plans as they’ve been produced have no significant cost spending events in them relative to reimbursement and relative to the way that they structure health care, that most American’s premiums aren’t going to go down and they will continue to go up, and that the debt of this country is unsustainable on our present course, and there isn’t a whole lot in this health care debate to date relative to the bills that have been produced that is going to do anything but continue to aggravate that and actually expand that problem. That’s my summary of what you’ve said. Is that a reasonable summary?

Douglas Elmendorf: … on the summary of the sobering perspective, yes, I agree with that, Senator. I’m sobered by having to give it.

http://budget.senate.gov/democratic/hearingstate.html

Comment:

By Don McCanne, MD

Is the health care cost debate limited to concerns about federal spending on health care, or is it about total health care spending? The distinction is very important because, if policies are limited to slowing the increase in the rate of federal health spending, many of those policies simply transfer costs from the government to individuals and businesses. It will give us little consolation to see the health care component of the federal budget in balance if individuals and businesses can’t afford health care.

It is informative to note that Chairman Conrad asked about products of the committees that would bend the long term cost curve, presumably the curve of the growth in our national health expenditures, and CBO Director Elmendorf’s response was limited to the trajectory of federal health spending.

Deficit hawk Gregg has continued to pound on the projected unsustainable growth in Medicare and Medicaid spending, and he is right that we should be concerned. But again, instead of policies that would merely shift costs out of the federal budget and on to individuals and businesses, we need policies that would reduce total health care cost increases to sustainable levels for everyone. This is what is interesting about Sen. Gregg’s question and Dr. Elmendorf’s response. They have concluded that the current legislative proposals are not going to have a significant impact on the upward trajectory of total health care costs.

It is unfortunate that the one measure that both indicated would be a very important policy to adopt would be to end the deductibility of employer-sponsored health plans. That helps with the federal budget, but it further increases health care costs for businesses and their employees.

For those who are very concerned about future federal deficits, there is a solution. Simply remove health care costs from the federal budget. Projections of future budget spending have been shown to be fully sustainable if health care costs are left out. Then set up a separate budget for health care financed through an equitably-funded universal risk pool.

President Obama has stated repeatedly that we must control health care costs as the first priority, and then we can cover everyone. The current proposals do neither. But with a single risk pool, and with the monopsony power of our own public administration we would be able to ensure health care value for absolutely everyone.

The fake persuaders

Corporations are inventing people to rubbish their opponents on the internet

By George Monbiot
The Guardian
Tuesday 14 May 2002

Persuasion works best when it’s invisible. The most effective marketing worms its way into our consciousness, leaving intact the perception that we have reached our opinions and made our choices independently. As old as humankind itself, over the past few years this approach has been refined, with the help of the internet, into a technique called “viral marketing”. Last month, the viruses appear to have murdered their host. One of the world’s foremost scientific journals was persuaded to do something it had never done before, and retract a paper it had published.

While, in the past, companies have created fake citizens’ groups to campaign in favour of trashing forests or polluting rivers, now they create fake citizens. Messages purporting to come from disinterested punters are planted on listservers at critical moments, disseminating misleading information in the hope of recruiting real people to the cause. Detective work by the campaigner Jonathan Matthews and the freelance journalist Andy Rowell shows how a PR firm contracted to the biotech company Monsanto appears to have played a crucial but invisible role in shaping scientific discourse.

Monsanto knows better than any other corporation the costs of visibility. Its clumsy attempts, in 1997, to persuade people that they wanted to eat GM food all but destroyed the market for its crops. Determined never to make that mistake again, it has engaged the services of a firm which knows how to persuade without being seen to persuade. The Bivings Group specialises in internet lobbying.

An article on its website, entitled Viral Marketing: How to Infect the World, warns that “there are some campaigns where it would be undesirable or even disastrous to let the audience know that your organisation is directly involved… it simply is not an intelligent PR move. In cases such as this, it is important to first ‘listen’ to what is being said online… Once you are plugged into this world, it is possible to make postings to these outlets that present your position as an uninvolved third party… Perhaps the greatest advantage of viral marketing is that your message is placed into a context where it is more likely to be considered seriously.” A senior executive from Monsanto is quoted on the Bivings site thanking the PR firm for its “outstanding work”.

On November 29 last year, two researchers at the University of California, Berkeley published a paper in Nature magazine, which claimed that native maize in Mexico had been contaminated, across vast distances, by GM pollen. The paper was a disaster for the biotech companies seeking to persuade Mexico, Brazil and the European Union to lift their embargos on GM crops.

Even before publication, the researchers knew their work was hazardous. One of them, Ignacio Chapela, was approached by the director of a Mexican corporation, who first offered him a glittering research post if he withheld his paper, then told him that he knew where to find his children. In the US, Chapela’s opponents have chosen a different form of assassination.

On the day the paper was published, messages started to appear on a biotechnology listserver used by more than 3,000 scientists, called AgBioWorld. The first came from a correspondent named “Mary Murphy”. Chapela is on the board of directors of the Pesticide Action Network, and therefore, she claimed, “not exactly what you’d call an unbiased writer”. Her posting was followed by a message from an “Andura Smetacek”, claiming, falsely, that Chapela’s paper had not been peer-reviewed, that he was “first and foremost an activist” and that the research had been published in collusion with environmentalists. The next day, another email from “Smetacek” asked “how much money does Chapela take in speaking fees, travel reimbursements and other donations… for his help in misleading fear-based marketing campaigns?”

The messages from Murphy and Smetacek stimulated hundreds of others, some of which repeated or embellished the accusations they had made. Senior biotechnologists called for Chapela to be sacked from Berkeley. AgBioWorld launched a petition pointing to the paper’s “fundamental flaws”.

There do appear to be methodological problems with the research Chapela and his colleague David Quist had published, but this is hardly unprecedented in a scientific journal. All science is, and should be, subject to challenge and disproof. But in this case the pressure on Nature was so severe that its editor did something unparalleled in its 133-year history: last month he published, alongside two papers challenging Quist and Chapela’s, a retraction in which he wrote that their research should never have been published.

So the campaign against the researchers was extraordinarily successful; but who precisely started it? Who are “Mary Murphy” and “Andura Smetacek”?

Both claim to be ordinary citizens, without any corporate links. The Bivings Group says it has “no knowledge of them”. “Mary Murphy” uses a hotmail account for posting messages to AgBioWorld. But a message satirising the opponents of biotech, sent by “Mary Murphy” from the same hotmail account to another server two years ago, contains the identification bw6.bivwood.com. Bivwood.com is the property of Bivings Woodell, which is part of the Bivings Group.

When I wrote to her to ask whether she was employed by Bivings and whether Mary Murphy was her real name, she replied that she had “no ties to industry”. But she refused to answer my questions on the grounds that “I can see by your articles that you made your mind up long ago about biotech”. The interesting thing about this response is that my message to her did not mention biotechnology. I told her only that I was researching an article about internet lobbying.

Smetacek has, on different occasions, given her address as “London” and “New York”. But the electoral rolls, telephone directories and credit card records in both London and the entire US reveal no “Andura Smetacek”. Her name appears only on AgBioWorld and a few other listservers, on which she has posted scores of messages falsely accusing groups such as Greenpeace of terrorism. My letters to her have elicited no response. But a clue to her possible identity is suggested by her constant promotion of “the Centre For Food and Agricultural Research”. The centre appears not to exist, except as a website, which repeatedly accuses greens of plotting violence. Cffar.org is registered to someone called Manuel Theodorov. Manuel Theodorov is the “director of associations” at Bivings Woodell.

Even the website on which the campaign against the paper in Nature was launched has attracted suspicion. Its moderator, the biotech enthusiast Professor CS Prakash, claims to have no connection to the Bivings Group. But when Jonathan Matthews was searching the site’s archives he received the following error message: “can’t connect to MySQL server on apollo.bivings.com”. Apollo.bivings.com is the main server of the Bivings Group.

“Sometimes,” Bivings boasts, “we win awards. Sometimes only the client knows the precise role we played.” Sometimes, in other words, real people have no idea that they are being managed by fake ones.

Doctors' group backs single-payer amendment to House health care bill

16,000 physicians urge passage of substitute 'Medicare for all' motion

FOR IMMEDIATE RELEASE
July 16, 2009

Contact:
Quentin Young, M.D., (312) 782-6006, info@pnhp.org
Mark Almberg, (312) 782-6006, cell: (312) 622-0996, mark@pnhp.org

Calling the health reform bill released by House Democrats a “proven failure,” an organization of 16,000 doctors called today for the passage of an amendment to the bill that would essentially overturn it and implement a single-payer, Medicare-for-all system.

The single-payer amendment to H.R. 3200, the House tri-committee bill unveiled two days ago by Speaker Nancy Pelosi (D-Calif.), is scheduled to be offered by Rep. Anthony Weiner (D-N.Y.) next Monday at the Energy and Commerce Committee, although it could be introduced as early as tomorrow.

Weiner is a co-sponsor of another House bill, the U.S. National Health Care Act, H.R. 676, sponsored by Rep. John Conyers (D-Mich.). Conyers’ bill, which has 85 co-sponsors, would create a single-payer system. Weiner’s amendment to H.R. 3200 would basically substitute the provisions of H.R. 676 for its present content.

Dr. Quentin Young, national coordinator of Physicians for a National Health Program, characterized the incremental reform bill offered by House Democrats this week as a “proven failure,” noting that state-based reforms of this type — Massachusetts being the latest example — have repeatedly foundered.

“The House proposal mimics the imploding Massachusetts reform,” Young said. “The state is dumping 30,000 legal residents off insurance, and the largest safety-net hospital is suing the state for decimating the hospital’s budget to shore up the reform. Meanwhile, 1 in 6 Massachusetts residents are unable to pay their medical bills, and 18 percent of residents with insurance skipped care last year because they couldn’t afford it. The Massachusetts model is no solution.”

Young greeted Weiner’s amendment, noting that it complements the efforts of other single-payer advocates who have lobbied, testified before Congress or otherwise pushed to ensure that national health insurance is “on the table” in the health reform debate.

Young added: “Although many supporters of the House tri-committee bill are well-intentioned, it’s an inconvenient truth that only by replacing the private health insurance industry with a single-payer, Medicare-for-All program can we save $400 billion annually on overhead and bureaucracy — enough to provide comprehensive, first-dollar coverage to all.”

The Chicago physician said a new study showing that 62 percent of personal bankruptcies in the U.S. are linked to medical bills or illness, and that three-quarters of those affected had insurance at the onset of their illness, is but the latest evidence that the private insurance model of financing care is breaking down and must be replaced.

“Surveys show that two-thirds of the public favor national health insurance, as do most physicians,” Young said. “Over 550 labor organizations support H.R. 676, as do scores of civic and religious groups and city governments. Our lawmakers should rise above the blandishments of the medical-industrial complex and vote for what’s in the nation’s best interest. That means supporting Weiner’s amendment and supporting H.R. 676.”

False promise of choice

For Many Workers, Insurance Choices May be Limited

By Mary Agnes Carey and Julie Appleby
Kaiser Health News
July 15, 2009
President Obama and leading Democrats have stressed that people who like their employer-sponsored insurance would be able to keep it, under a health care overhaul. But they haven’t emphasized the flip side: That people who don’t like their coverage might have to keep it.
Under the main health bills being debated in Congress, many people with job-based insurance could find it difficult to impossible to switch to health plans on a new insurance exchange, even if the plans there were cheaper or offered better coverage. The restrictions extend to any government-run plan, which would be offered on the exchange.
The provisions could change, and there are a few exceptions: Workers would be allowed to buy insurance through the exchange if their job-based coverage gobbled up too much of their incomes or was too skimpy. Also, under the House proposal, people could get insurance through the exchange if they paid their entire premiums ā€” a cost that would be prohibitive for many workers.
Democratic lawmakers and administration officials say the restrictions are critical to maintaining a strong employer-based insurance system, which covers 158 million Americans.
But critics argue that the rules run counter to suggestions from health care reform advocates that an overhaul could provide people with a broader choice of insurance options. The rules, they say, could be especially unfair to some lower-income workers who are enrolled in costly job-based insurance. Also, they argue, the restrictions would hurt the proposed public plan by limiting enrollment.
Jonathan Oberlander, associate professor at the University of North Carolina at Chapel Hill, said the restrictions create a “big gap between the rhetoric and the reality” of health reform.
“The rhetoric is that Americans will gain new alternatives,” he said. “But the reality is that they are putting up firewalls that are going to restrict the access of people with employer-sponsored insurance to the exchange.”
One result, he said, is that any public plan would be substantially smaller than what many backers are envisioning. That would reduce the public plan’s power to compete with private insurers and hold down costs, he said. The Congressional Budget Office estimates that nine million to 10 million people would enroll in the public plan by 2019.
http://www.kaiserhealthnews.org/Stories/2009/July/15/Firewall.aspx

Imagine presidential candidate Barack Obama telling his audiences during the campaign, “We promise you choice. For most of you already receiving your health insurance through your place on employment, we will provide you with the choice of keeping that insurance plan or paying heavy financial penalties for dropping off the plan, no matter how unhappy you are with it. For a select few of you, we will offer the choice of private plans within an insurance exchange, even if you can’t afford them, and maybe even throw in a public plan that a couple of you may be able to purchase, if you meet our rigid enrollment criteria.”
Choice? Over a year ago in a Quote of the Day I discussed the decision to market health reform as a matter of choice – of keeping the plan you have if that’s your choice. The title of that qotd was “Message trumps policy?”
This isn’t an “I told you so.” Er… uh… I guess it is.
If reform is to be effective, it must be based on sound policy science. Instead, it is being based on political messaging. It may sound good, but nothing fits together. What a disaster.

False promise of choice

For Many Workers, Insurance Choices May be Limited

By Mary Agnes Carey and Julie Appleby
Kaiser Health News
July 15, 2009

President Obama and leading Democrats have stressed that people who like their employer-sponsored insurance would be able to keep it, under a health care overhaul. But they haven’t emphasized the flip side: That people who don’t like their coverage might have to keep it.

Under the main health bills being debated in Congress, many people with job-based insurance could find it difficult to impossible to switch to health plans on a new insurance exchange, even if the plans there were cheaper or offered better coverage. The restrictions extend to any government-run plan, which would be offered on the exchange.

The provisions could change, and there are a few exceptions: Workers would be allowed to buy insurance through the exchange if their job-based coverage gobbled up too much of their incomes or was too skimpy. Also, under the House proposal, people could get insurance through the exchange if they paid their entire premiums Ć¢ā‚¬ā€ a cost that would be prohibitive for many workers.

Democratic lawmakers and administration officials say the restrictions are critical to maintaining a strong employer-based insurance system, which covers 158 million Americans.

But critics argue that the rules run counter to suggestions from health care reform advocates that an overhaul could provide people with a broader choice of insurance options. The rules, they say, could be especially unfair to some lower-income workers who are enrolled in costly job-based insurance. Also, they argue, the restrictions would hurt the proposed public plan by limiting enrollment.

Jonathan Oberlander, associate professor at the University of North Carolina at Chapel Hill, said the restrictions create a “big gap between the rhetoric and the reality” of health reform.

“The rhetoric is that Americans will gain new alternatives,” he said. “But the reality is that they are putting up firewalls that are going to restrict the access of people with employer-sponsored insurance to the exchange.”

One result, he said, is that any public plan would be substantially smaller than what many backers are envisioning. That would reduce the public plan’s power to compete with private insurers and hold down costs, he said. The Congressional Budget Office estimates that nine million to 10 million people would enroll in the public plan by 2019.

http://www.kaiserhealthnews.org/Stories/2009/July/15/Firewall.aspx

Comment:

By Don McCanne, MD

Imagine presidential candidate Barack Obama telling his audiences during the campaign, “We promise you choice. For most of you already receiving your health insurance through your place on employment, we will provide you with the choice of keeping that insurance plan or paying heavy financial penalties for dropping off the plan, no matter how unhappy you are with it. For a select few of you, we will offer the choice of private plans within an insurance exchange, even if you can’t afford them, and maybe even throw in a public plan that a couple of you may be able to purchase, if you meet our rigid enrollment criteria.”

Choice? Over a year ago in a Quote of the Day I discussed the decision to market health reform as a matter of choice – of keeping the plan you have if that’s your choice. The title of that qotd was “Message trumps policy?”

This isn’t an “I told you so.” Er… uh… I guess it is.

If reform is to be effective, it must be based on sound policy science. Instead, it is being based on political messaging. It may sound good, but nothing fits together. What a disaster.

Health Insurance Whistle-Blower Knows Where the Bodies Are Buried

By Amy Goodman
TruthDig.com
Posted on Jul 14, 2009

Wendell Potter is the health insurance industry’s worst nightmare. He’s a whistle-blower. Potter, the former chief spokesperson for insurance giant CIGNA, recently testified before Congress, “I saw how they confuse their customers and dump the sick–all so they can satisfy their Wall Street investors.”

Potter was deeply involved in CIGNA and industrywide strategies for maintaining their profitable grip on U.S. health care. He told me: “The thing they fear most is a single-payer plan. They fear even the public insurance option being proposed; they’ll pull out all the stops they can to defeat that to try to scare people into thinking that embracing a public health insurance option would lead down the slippery slope toward socialism … putting a government bureaucrat between you and your doctor. They’ve used those talking points for years, and they’ve always worked.”

In 2007, CIGNA denied a California teenager, Nataline Sarkisyan, coverage for a liver transplant. Her family went to the media. The California Nurses Association joined in. Under mounting pressure, CIGNA finally granted coverage for the procedure. But it was too late. Two hours later, Nataline died.

While visiting family in Tennessee, Potter stopped at a “medical expedition” in Wise, Va. People drove hours for free care from temporary clinics set up in animal stalls at the local fairground. Potter told me that weeks later, flying on a CIGNA corporate jet with the CEO: “I realized that someone’s premiums were helping me to travel that way … paying for my lunch on gold-trimmed china. I thought about those men and women I had seen in Wise County … not having any idea [how] insurance executives lived.” He decided he couldn’t be an industry PR hack anymore.

Insurance executives and their Wall Street investors are addicted to massive profits and double-digit annual rate increases. To squeeze more profit, Potter says, if a person makes a major claim for coverage, the insurer will often scrutinize the person’s original application, looking for any error that would allow it to cancel the policy. Likewise, if a small company’s employees make too many claims, the insurer, Potter says, “very likely will jack up the rates so much that your employer has no alternative but to leave you and your co-workers without insurance.”

This week, as the House and Senate introduce their health care bills, Potter warns, “One thing to remember is that the health insurance industry has been anticipating this debate on health care for many years … they’ve been positioning themselves to get very close to influential members of Congress in both parties.” Montana Sen. Max Baucus chairs the Senate Finance Committee, key for health care reform. Potter went on, “[T]he insurance industry, the pharmaceutical industry and others in health care have donated … millions of dollars to his campaigns over the past few years. But aside from money, it’s relationships that count … the insurance industry has hired scores and scores of lobbyists, many of whom have worked for members of Congress, and some who are former members of Congress.”

The insurance industry and other health care interests are lobbying hard against a government-sponsored, nonprofit, public health insurance option, and are spending, according to The Washington Post, up to $1.4 million per day to sway Congress and public opinion.

Don’t be fooled. Profit-driven insurance claim denials actually kill people, and Wendell Potter knows where the bodies are buried. His whistle-blowing may be just what’s needed to dump what’s sick in our health care system.

Denis Moynihan contributed research to this column.

Amy Goodman is the host of “Democracy Now!,” a daily international TV/radio news hour airing on more than 750 stations in North America. She is the co-author of “Standing Up to the Madness: Ordinary Heroes in Extraordinary Times,” recently released in paperback.

Going for the Gold

The Redistributive Agenda behind Market-Based Health Care Reform

By Robert G. Evans.
Journal of Health Politics
Vol. 22. No. 2, April 1997

Click here to download the pdf.

Abstract

Political conflict over the respective roles of the state and the market in health care has a long history. Current interest in market approaches represents the resurgence of ideas and arguments that have been promoted with varying intensity throughout this century. (In practice, advocates have never wanted a truly competitive market, but rather one managed by and for particular private interests.) Yet international experience over the last forty years has demonstrated that greater reliance on the market is associated with inferior system performance–inequity, inefficiency, high cost, and public dissatisfaction. The United States is the leading example. So why is this issue back again? Because market mechanisms yield distributional advantages for particular influential groups. (1) A more costly health care system yields higher prices and incomes for suppliers–physicians, drug companies, and private insurers. (2) Private payment distributes overall system costs according to use (or expected use) of services, costing wealthier and healthier people less than finance from (income-related) taxation. (3) Wealthy and unhealthy people can purchase (real or perceived) better access or quality for themselves, without having to support a similar standard for others. Thus there is, and always has been, a natural alliance of economic interest between service providers and upper-income citizens to support shifting health financing from public to private sources. Analytic arguments for the potential superiority of hypothetical competitive markets are simply one of the rhetorical forms through which this permanent conflict of economic interest is expressed in political debate.

“Going for the Gold: The Redistributive Agenda behind Market-based Health Care Reform,” Journal of Health Politics, Policy and Law, Vol. 22. No. 2, April 1997.

Click here to download the pdf.