Key Democrat in Health Care Talks Receives Large Health Industry Contributions in 2009

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As the summer of the Democrats’ discontent winds to a close, the head count for health care reform in the Senate begins in earnest. One of the key Democratic senators on the fence is Sen. Blanche Lincoln, a member of the Senate Finance Committee and one of the most vulnerable Democrats in the 2010 election. Lincoln jumped into the news today with a quote to a reporter stating her opposition to a public option plan in a health care reform bill. “I would not support a solely government-funded public option. We can’t afford that,” Lincoln said. The senior Arkansas senator is also the 2nd highest recipient of campaign contributions from the health industry among senators this year.

According to the Center for Responsive Politics, Lincoln has received $325,350 in contributions from the health industry, as of June 30. The large amount in contributions underlies a constantly shifting position by the senator on health care reform.

One of Lincoln’s biggest contributors this cycle is the insurance giant Blue Cross Blue Shield. The company’s political action committee and employees have combined to give the senator $29,500 this year alone. Blue Cross Blue Shield and their parent company Wellpoint are vocal opponents of the inclusion of a public option plan in any health care reform bill. Blue Cross Blue Shield is the dominant insurer in Arkansas holding a 75 percent market share.

Blue Cross Blue Shield does not need to only rely on campaign contributions to reach Sen. Lincoln, as they retain Lincoln’s former top health care policy adviser as a lobbyist. Elizabeth Barnett worked for Lincoln from 2000 to 2007 before leaving to become the top Democratic lobbyist for Blue Cross Blue Shield. Earlier this year, Barnett left Blue Cross to work for Avenue Solutions, where she retains Blue Cross Blue Shield as a client. Avenue Solutions’ profile of Barnett notes that she “had primary responsibility for representing [Blue Cross Blue Shield] and its 39 member plans before the Senate Finance Committee, Senate Democratic Leadership, and other key Senate committees and offices.” Barnett also represents other health industry organizations including UnitedHealth Group, Aetna, Bravo Health, Healthcare Leadership Council, Medco and the National Health Policy Group.

Barnett is not the only former Lincoln staffer working as a lobbyist for the health industry. Lincoln’s former chief of staff Kelly Bingel is a lobbyist specializing in health care at Mehlman Vogel Castagnetti Inc, the lobbying firm of Sen. Max Baucus’ former chief of staff David Castagnetti. Bingel represents a who’s who of the health care industry including America’s Health Insurance Plans (AHIP) and Pharmaceutical Researchers & Manufacturers of America (PhRMA). AHIP and PhRMA have been largely supportive of health care reform this year. PhRMA, in particular, has supported the current legislation with positive advertising after receiving concessions from the White House and the Senate Finance Committee. Bingel also represents the Business Roundtable, a group that has voiced opposition to health care reform.

Throughout this year, Lincoln has benefited from countless fundraisers thrown by lobbyists. The Party Time database lists one fundraiser thrown by health care lobbyists for Lincoln. On July 24, Ernst & Young feted Lincoln with a fundraiser hosted by health care lobbyists Nick Giordano (formerly of Sen. Baucus’ staff), Dick Meltzer (since moved on to Speaker Pelosi’s staff), LaBrenda Garrett-Nelson, Holly Bode, Francis Grab, Dave Koshgarian and Jeff Petrich. Contributions from this fundraiser will not be publicly available until the third quarter finance reports are filed.

update: post edited.

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  • John Thacker

    I am small business owner that provides health benefits to all 50 of my employees and their families. I do not have to look at their tax returns to tell you that they are profiting largely.

    Interesting, Kevin. So you’re a small business owner? If your prices increase, then customers shouldn’t trust you if you say your costs increase, but should just know that you’re “profiting largely?”

    Anyone who thinks that health insurance profits are the cause of health care costs is ill-informed. As noted by Rojo, there are quite a bit of not-for-profit and even mutual insurance companies. All are heavily regulated by states. There are no significant differences in premiums among not-for-profit companies, mutuals, and for-profit companies. (There are significant differences state-to-state with different regulations; generally states that require more coverage or require people with pre-existing conditions be covered have higher premiums for everyone else.)

    Medicare spending doesn’t involve health insurance companies (outside of some seniors who pay extra for Medicare Advantage). But Medicare’s costs for seniors are also higher than the costs for seniors in other countries, just like the costs for people outside of Medicare in this country.

    Government spending and regulation already controls most of the health care in this country. Still, even if we move to a single-payer health care system, we should expect the amount of lobbying to increase, not decrease, especially from pharmaceutical companies wanting their new drugs covered, and from hospitals and doctors wanting larger reimbursements.

  • Kevin

    If Blue Cross Blue shield is funneling money to congress through high paid lobbyist, there are profits that they want protected through legislation, perhaps not higher dividneds to stockholders, but look at the bonus payouts for board members and top tier management that are reported as an expense on the income staement.
    I am small business owner that provides health benefits to all 50 of my employees and their families. My comapny premiums have risen from $7,800 to $41,000 in 8 years, and my healthcare insurance provider is Blue Cross Blue Shield of Arkansas.
    I do not have to look at their tax returns to tell you that they are profiting largely.

  • Rojo

    About 65 or 70 originally independent companies that have been merged into 39 BCBS companies which are independent of each other but not independent of the BCBS Association (they are all members of the governing BCBSA entity).
    I believe one stock company – the large Wellpoint company generally doing business as Anthem BCBS Plans in several states across the country.
    About ten or eleven Mutual Companies and two dozen not-for-profit companies that typically serve single-state, or parts of single states, service areas. Some of those not-for-profit companies apparently own for-profit subsidiaries. Most of these not-for-profits are heavily regulated by state’s departments of insurance as allowed by their enabling legislation.

  • juzdafax

    Provoking Thought,

    Your claim the BCBS is a nonprofit is fractious at best, disingenuous at worst. From Wiki:

    Since the Tax Reform Act of 1986, organizations administering Blue Cross Blue Shield plans lost their full tax-exempt status. They became 501(m) organizations, subject to federal taxation but entitled to “special tax benefits.”[7] Some plans[specify] are still considered not-for-profit at the state level.
    Blue Cross and/or Blue Shield insurance companies are franchisees, independent of the association (and traditionally each other), offering insurance plans within defined regions under one or both of the association’s brands. Blue Cross Blue Shield insurers offer some form of health insurance coverage in every U.S. state. They also act as administrators of Medicare in many states or regions of the U.S., and provide coverage to state government employees as well as to the federal government employees under a nationwide option of the Federal Employees Health Benefit Plan.[citation needed]
    The 14-state WellPoint is the largest Blue Cross Blue Shield member, and is a publicly traded company. Other multi-state organizations include CareFirst in the Mid-Atlantic and The Regence Group in the Pacific Northwest. The largest non-investor owned member is Health Care Service Corporation,[citation needed] which operates four Blue Cross and Blue Shield Plans in the Midwest and Southwest.
    List of Blue Cross and Blue Shield companies
    Publicly traded companies
    • Anthem (insurance) for-profit (WellPoint)
    o Anthem Blue Cross Blue Shield
     Colorado
     Connecticut
     Indiana
     Kentucky
     Maine
     Missouri
     Nevada
     New Hampshire
     Ohio
     Parts of Virginia
     Wisconsin
    o Anthem Blue Cross
     California
    o Blue Cross Blue Shield of Georgia
    o Empire Blue Cross and Blue Shield (New York)
    Multi-state private companies
    • CareFirst
    o District of Columbia
    o Maryland
    o Parts of Virginia
    • Health Care Service Corporation
    o Blue Cross Blue Shield of Illinois
    o Blue Cross Blue Shield of New Mexico
    o Blue Cross Blue Shield of Oklahoma
    o Blue Cross Blue Shield of Texas
    • Highmark
    o Highmark Blue Cross Blue Shield (Western Pennsylvania)
    o Highmark Blue Shield (Eastern & Central Pennsylvania)
    o Mountain State Blue Cross and Blue Shield (West Virginia)
    • Premera
    o Premera Blue Cross Blue Shield of Alaska
    o Premera Blue Cross (Washington)
    • The Regence Group
    o Regence Blue Shield of Idaho
    o Regence Blue Cross Blue Shield of Oregon
    o Regence Blue Cross Blue Shield of Utah
    o Regence Blue Shield (Washington)
    • Wellmark Blue Cross Blue Shield
    o Iowa
    o South Dakota
    Single-state or regional companies
    • Blue Cross Blue Shield of Alabama
    • Blue Cross Blue Shield of Arizona
    • Arkansas Blue Cross Blue Shield
    • Blue Shield of California
    • Blue Cross Blue Shield of Delaware
    • Blue Cross Blue Shield of Florida
    • Hawaii Medical Services Association
    • Blue Cross of Idaho
    • Blue Cross Blue Shield of Kansas
    • Blue Cross Blue Shield of Louisiana
    • Blue Cross Blue Shield of Massachusetts
    • Blue Cross Blue Shield of Michigan
    • Blue Cross Blue Shield of Minnesota
    • Blue Cross Blue Shield of Mississippi
    • Blue Cross Blue Shield of Kansas City (Missouri)
    • Blue Cross Blue Shield of Montana
    • Blue Cross Blue Shield of Nebraska
    • Horizon Blue Cross Blue Shield of New Jersey
    • Excellus Blue Cross Blue Shield (Central New York)
    • Blue Shield of Northeastern New York
    • Blue Cross Blue Shield of Western New York
    • Blue Cross Blue Shield of North Carolina
    • Blue Cross Blue Shield of North Dakota
    • Blue Cross of Northeastern Pennsylvania
    • Capital Blue Cross (Central Pennsylvania)
    • Independence Blue Cross (Philadelphia, Southeastern Pennsylvania)
    • Blue Cross Blue Shield of Rhode Island
    • Blue Cross Blue Shield of South Carolina
    • Blue Cross Blue Shield of Tennessee
    • Blue Cross Blue Shield of Vermont
    • Blue Cross Blue Shield of Wyoming
    [edit] Puerto Rico
    • La Cruz Azul de Puerto Rico (Blue Cross)
    • Triple-S Management Corporation (Blue Shield

    The publicly traded companies listed above are sure-as-hell profit takers, and many of the private entities likely are as well.

  • Willis Hill

    Does the recent fine paid by Phizer tell us anything about the motivations of private companies in health care?

  • FredZ

    26 of the 27 top industrialized countries of the world have successful government managed healthcare systems. Their citizens are very happy with the results. That is a 100% success rate. There is simply no reasonable argument as to the fact government can do an excellent job managing healthcare.

  • Paulette

    Thank you Chloe for giving Provoking Thought a reality check. Misinformation needs to be checked before it infects the innocent and ignorant!

  • chloe

    What planet are you living on? Non-profit or for profit, BCBS is in business for one thing, to make those that run it LOTS OF MONEY. And that is exactly wjat happens. Do your research, BCBS plans have been cited numerous times for stealing money from government health programs, doctors and patients. Also, BSBS has huge and very lucrative contracts with the government to administer Medicare, fee for service. They have been cited in countless GAO reports for overcharging and misrepresentation. As far BCBS private Medicare, it is undisputed that the care that these private plans deliver is far more expensive, costs taxpayers much more that regular “government” Medicare, and they deliver no quality improvements. STOP DRINKING THE KOOLAIDE!!

  • Thanks for pointing this out, however, does it poison the well?

    Blue Cross Blue Shield is a not for profit organization as the president has pointed out on several occassions and they are also a lead provider of many medicare option programs that are run much more cost effective than the Medicare B/C.

    Thanks again for following the money so people can see a cause and effect relationship between contributions and votes. Voting in the interest of blue cross/blue shield is not nefarious in my opinion, especially when compared to medicare and medicaid.

    Disclaimer: My experience in contract healthcare operations management jades my opinion on the ability of the government to either save us any money or run a non-corrupt organization than is effective.

    I can not tell you how many facilites can barely afford to accept the terms of payment for medicare, most times involving 90 day waits for billing reimbursement and that is if everything is coded properly. Medicare is a coding game anymore and HR 3200 just adds layers.

    So I am biased in that I do not believe the government even has the ability to run it, much less save money.