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Reid Gives Nelson, Lincoln What Their Lobbyist Friends Want

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TPM is reporting that Majority Leader Harry Reid is going to exclude a provision that would remove the anti-trust exemption for health insurers from the Senate health care reform bill. The move is apparently being made to grease the gears for Sen. Ben Nelson, one of three Democratic hold-outs, to vote for procedural motions in the run-up to a final vote. The provision was a huge fear of health insurers, particularly of America's Health Insurance Plans (AHIP) and Blue Cross Blue Shield. Both of those organizations are represented by former staffers to Sen. Nelson and fellow hold-out Sen. Blanche Lincoln.

As documented in this post from two days ago, Sen. Nelson's former legislative director now lobbies for three top health insurers: Blue Cross Blue Shield, Aetna and UnitedHealth Group. Sen. Lincoln's former top health adviser Elizabeth Barnett lobbies for the same three health insurers. Kelly Bingel, Sen. Lincoln's former chief of staff, lobbies for AHIP. Since 2005, Blue Cross Blue Shield has contributed over $80,000 to Sen. Lincoln and over $65,000 to Sen. Nelson.

Blue Cross Blue Shield is the largest provider of health insurance in both senator's states. In Arkansas, Blue Cross holds a 75% market share and UnitedHealth Group is second with 6% market share. Blue Cross' market share in Nebraska is 44% and UnitedHealth Group has a 25% market share. In both states, the removal of the anti-trust exemption could cause serious loss of market share for these companies.

The exclusion of the provision to remove the exemption would be a big win for these former staffers turned lobbyists. Not only did they get what their clients wanted, but the utility of their connections has been publicly touted.

The provision to remove the health insurer anti-trust exemption was included in the House bill and supported by President Barack Obama. It was used by the House and the White House as a stick to keep the health insurance industry from waging a public campaign of opposition. When the industry finally decided to publicly oppose the bill, the provision was included in the final House legislation.