Obama Seeks to Vilify Health Insurers, Give Them $336 Billion Check

March 10, 2010

ABC News

ABC’s Z. Byron Wolf reports: President Obama and Democrats launched a campaign to vilify insurance companies in the final stretch of their health reform effort.

Republicans, meanwhile, pointed out that those very same insurance companies would get huge checks from the government if health reform is enacted.

“(Health Insurers) will keep on doing this for as long as they can get away with it. This is no secret,” the president said. “They’re telling their investors this – ‘We are in the money.  We are going to keep on making big profits even though a lot of folks are going to be put under hardship,’” the President told supporters at a stop in Pennsylvania today.

HHS Secretary Kathleen Sebelius, meanwhile, wrote to insurance company executives demanding that they justify premium hikes.

Neither mentioned that the Senate health reform bill, which is the basis for Democrats’ last best chance at comprehensive reform, would give the insurance companies millions of new customers required by law to buy health insurance. It would also require insurers to cover everyone, regardless of age, gender or pre-existing condition.

To help pay for the new insurance requirements the government would give to people money to buy insurance – $336 billion over the next ten years. That money, ultimately, would have to go to… drum roll… insurance companies.

People without employer-sponsored insurance who make too much money to qualify for Medicaid and less than about $88,000 for a family of four, would get tax credits to help them buy insurance on the open market. But the payment of the tax credits would be made, point out Republican researchers, directly to insurance companies. See page 37 here of the Senate Finance Committee’s exhaustive explanation of the plan:

During the 2008 Presidential campaign, then-Senator Obama criticized a proposal by Sen. John McCain because it would send government help for people to buy insurance directly to insurance companies.

“But The New Tax Credit [For Health Insurance] He’s Proposing? That Wouldn’t Go To You. It Would Go Directly To Your Insurance Company – Not Your Bank Account,” said Obama in October on the Campaign trail.

And yet that’s exactly what Democrats’ proposal would do and why so many would prefer public insurance option to compete with the private market. Supporting the Senate bill will be tough for many liberal Democrats in the House.

To the Republicans’ (and Obama’s on the campaign trail) point about the payments going directly to insurance companies, remember that people with employer-sponsored insurance or current federal medical benefits do not usually get a separate check to buy insurance either. They pay premiums directly to the insurance company and so does their employer. The Senate proposal would create a similar relationship between people who don’t have employer-based insurance and the government.

So why do Insurance companies, if they’re set to receive more than $330 billion in government subsidies to insure people without insurance now oppose the Senate bill?

“Health plans proposed more than a year ago robust insurance market reforms and new consumer protections to guarantee coverage for pre-existing conditions. Much more needs to be done in the current legislation to address the skyrocketing cost of medical care, which is making health care coverage unaffordable for working families and small businesses,” said Robert Zirkelbach, a spokesman from America’s Health Insurance Plans, in a statement today.

He argued that health insurers should not be targeted by the President and their profits are lower by margin than other sectors in the health industry.

“For every dollar spent on health care in America, less than one penny goes towards health plan profits. The focus needs to be on the other 99 cents,” he said.

Click here for the full report.

GlaxoSmithKline Knew of Drug Dangers

February 23, 2010

Natural News

By Mike Adams

GlaxoSmithKline, maker of the diabetes drug Avandia, knew the drug was linked to tens of thousands of heart attacks but went out of its way to hide this information from the public, says a 334-page report just released by the Senate Finance Committee. (http://finance.senate.gov/press/Gpr…)

This report also accuses the FDA of betraying the public trust, explaining that FDA bureaucrats intentionally dismissed safety concerns found by the agency’s own scientists.

The report says that Big Pharma’s drugs “put public safety at risk because the FDA has been too cozy with drug makers and has been regularly outmaneuvered by companies that have a financial interest in downplaying or under-exploring potential safety risks.” Sales of Avandia were $3.2 billion (yes, billion) in 2006.

According to a statistical analysis in the report, if all the diabetics currently taking Avandia were put on a “safer” drug, it would avert 500 heart attacks and 300 cases of heart failure every month in the United States alone. Presently, hundreds of thousands of Americans are still taking this drug, and hundreds will continue to die each month as a result, according to the report estimates.

This report, championed by U.S. Senators Grassley and Baucus, is the result of investigators pouring through more than 250,000 pages of documentation gathered from GlaxoSmithKline and the FDA. The document reveals some rather startling facts about the dangers of Avandia, including evidence from the FDA’s own scientists who concluded that Avandia was associated with 83,000 heart attacks.

GlaxoSmithKline intimidates scientists
This investigative report also reveals that GSK engaged in the intimidation of physicians, saying: “GSK executives attempted to intimidate independent physicians, focused on strategies to minimize or misrepresent findings that Avandia may increase cardiovascular risk and sought ways to downplay findings that a competing drug might reduce cardiovascular risk.”

“Patients trust drug companies with their health and their lives, and GlaxoSmithKline abused that trust.” said Sen. Baucus. (Gee, really? Is anyone really surprised that GSK put its own financial interests ahead of a few thousand human lives?)

A separate letter sent to FDA Commissioner Margaret Hamburg by Senators Baucus and Grassley added, “the totality of evidence suggests that GSK was aware of the possible cardiac risks associated with Avandia years before such evidence became public.”

The FDA’s own research also showed Avandia to be associated with a significant increase in heart attack risk, yet the FDA did nothing to protect the public. The agency’s own scientists wrote in 2008, “There is strong evidence that rosiglitazone [Avandia] confers an increased risk of [heart attacks] and heart failure compared to pioglitazone [a rival drug on market].” This evidence went completely ignored at the FDA.

The FDA’s famous Dr David Graham — the key whistleblower on the Vioxx scandal — concluded from his own research, “Rosiglitazone should be removed from the market.”

Even the American Medical Association — a long-time defender of Big Pharma’s drugs — admitted Avandia was dangerous. Its journal, JAMA, wrote in 2007: “Among patients with impaired glucose tolerance or type 2 diabetes, rosiglitazone use for at least 12 months is associated with a significantly increased risk of myocardial infarction and heart failure, without a significantly increased risk of cardiovascular mortality.”

The New England Journal of Medicine also warned about the safety of the drug in an article published in 2007.

Despite these multiple warnings, an FDA panel voted 22 – 1 in favor of keeping Avandia on the market. This is no surprise, of course, to those who know how the FDA really operates (and where its priorities really lie).

To continue reading this report, click here.

Jail Time for Those without Health Care Insurance

November 11, 2009

ABCNews

By Sunien Miller

During an exclusive interview with ABC News’ Jake Tapper today, President Obama said that penalties are appropriate for people who try to “free ride” the health care system but stopped short of endorsing the threat of jail time for those who refuse to pay a fine for not having insurance.

“What I think is appropriate is that in the same way that everybody has to get auto insurance and if you don’t, you’re subject to some penalty, that in this situation, if you have the ability to buy insurance, it’s affordable and you choose not to do so, forcing you and me and everybody else to subsidize you, you know, there’s a thousand dollar hidden tax that families all across America are — are burdened by because of the fact that people don’t have health insurance, you know, there’s nothing wrong with a penalty.”
Under the House bill those who can afford to buy insurance and don’t’ pay a fine. If the refuse to pay that fine there’s a threat – as with a lot of tax fines – of jail time. The Senate removed that provision in the Senate Finance Committee.

Mr. Obama said penalties have to be high enough for people to not game the system, but it’s also important to not be “so punitive” that people who are having a hard time find themselves suddenly worse off, thus why hardship exemptions have been built in the legislation.

“I think the general broad principle is simply that people who are paying for their health insurance aren’t subsidizing folks who simply choose not to until they get sick and then suddenly they expect free health insurance.  That’s — that’s basic concept of responsibility that I think most Americans abide by,” Mr. Obama said, “penalties are appropriate for people who try to free ride the system and force others to pay for their health insurance.”

The President said that he didn’t think the question over the appropriateness of possible jail time is the “biggest question” the House and Senate are facing right now.

Click here for the full report.

Insurers say Health Care Bill will Lead to System Collapse

October 19, 2009

DenverPost.com

By Jennifer Brown

Colorado insurance executives, cautious supporters of health care reform throughout the past year, are now warning that current proposals could cause a “system collapse.”

At issue are what insurance companies consider absurdly low penalties for people who choose not to buy health insurance.

Their concern: People will buy insurance only when they desperately need it, such as after they’re diagnosed with cancer or heart disease.

Healthy people might choose to pay the penalty, now proposed at a few hundred dollars per year, because it is far less expensive than buying insurance.

Insurance companies, under that scenario, would end up spending more to treat patients than they would receive in premiums. Rates would rise even faster than they do now.

“People would come in, pay premiums for a few months while they were getting their cancer treatments,” said John Martie, president and general manager of Anthem Blue Cross Blue Shield of Colorado. “If enough people did that, the whole system would collapse.

“I would hope it wouldn’t get that far. Ultimately, it would lead to rationing of care.”

In the health care bill passed Tuesday by the Senate Finance Committee, adults who do not purchase health insurance would face an excise-tax penalty of $200 a year starting in 2014 and rising gradually to $750 in 2017.

The tax would be prorated if an individual has health insurance for part of a year.

The insurance industry incited an immediate and passionate backlash after saying the Senate bill would cause insurance premiums to increase.

Critics accused the industry of using scare tactics to derail reform.

Gov. Bill Ritter slammed insurance companies in a campaign e-mail last week, calling on America’s Health Insurance Plans to retract its “misleading, fear-mongering statement” that said premiums would rise.

“The same folks who successfully derailed health care reform last time around are once again up to no good,” Ritter said. “It’s a self-serving, untrue, desperate effort by the insurance industry to protect its excessive profits — and one that cannot be taken seriously.”

Reform advocates say it is farfetched to assume people who can’t afford insurance — and might qualify for government subsidies — would opt to pay a penalty instead.

“They are assuming that people would game the system,” said Denise de Percin, executive director of the Colorado Consumer Health Initiative.

“They are looking at the worst-case scenario. People aren’t stupid — they are not going to pay a penalty and get nothing,” de Percin said.

Supporters of the legislation from the Senate Finance Committee also point out that the proposed penalty is only a proposal. Congress likely will refine the legislation, aiming to strike the right balance between government subsidies and penalties for violating the insurance mandate.

But Ben Price, executive director of the Colorado Association of Health Plans, said the proposed penalty is way off the mark. It is so low, “we can’t really call it a mandate,” he said.

“Without a mechanism for enforcement, people will wait until they are sick to get coverage,” Price said.

Premiums, he said, would “go up for individuals, small business, everyone. Congress needs to create a strong mandate in order to make an ‘all-in’ system work.”

Executives still back reform

Colorado insurance executives said they still support reform and point out that they offered a year ago to stop rejecting patients with pre-existing health conditions if the government would require everyone to purchase insurance.

“We’ve been adamant all along that those penalties have to be higher than what premiums would cost,” said Martie, who was in Washington two weeks ago lobbying Colorado lawmakers.

“We deal with the two most sensitive areas in people’s lives — their health and their finances,” he said. “Unfortunately, in the very beginning, President Obama pointed out that we were the villains and they needed to keep us honest.”

Despite conflicting analysis on whether the current proposal would cut health care costs, Arvada resident Peggy Woodward is confident it would save her money.

Woodward, who was laid off from her telecommunications job a year ago, is about to cancel her health insurance because she can’t afford the $223 monthly premium. Under the legislation, she would qualify for a subsidy of about $2,000 per year.

“That’s a very significant savings for me,” she said. “I do hope they pass it just as soon as possible.”

Click here for the full report.

Democrats Warned by Insurance Companies

October 13, 2009

My Way

By Ricardo Alonso-Zaldivar

Insurance companies aren’t playing nice any more. Their dire message that health care legislation will drive up premiums for people who already have coverage comes as a warning shot at a crucial point in the debate, and threatens President Barack Obama’s top domestic priority.

Democrats and their allies scrambled on Monday to knock down a new industry-funded study forecasting that Senate legislation, over time, will add thousands of dollars to the cost of a typical policy. “Distorted and flawed,” said White House spokeswoman Linda Douglass. “Fundamentally dishonest,” said AARP’s senior policy strategist, John Rother. “A hatchet job,” said a spokesman for Senate Finance Committee chairman Max Baucus, D-Mont.

But the health insurance industry’s top lobbyist in Washington stood her ground. In a call with reporters, Karen Ignagni, president of America’s Health Insurance Plans, pointedly refused to rule out attack ads on TV featuring the study, though she said she believed the industry’s concerns could be amicably addressed.

At the heart of the industry’s complaint is a decision by lawmakers to weaken the requirement that millions more Americans get coverage. Since the legislation would ban insurance companies from denying coverage on account of poor health, many people will wait to sign up until they get sick, the industry says. And that will drive up costs for everybody else.Insurers are now raising possibilities such as higher premiums for people who postpone getting coverage, or waiting periods for those who ignore a proposed government requirement to get insurance and later have a change of heart.

The drama threatened to overshadow Tuesday’s scheduled vote by the Senate Finance Committee on a 10-year, $829-billion plan that Baucus has touted as the sensible solution to America’s problems of high medical costs and too many uninsured.

The Baucus bill is still expected to win Finance Committee approval. The insurance industry is trying to influence what happens beyond the vote, when legislation goes to the floor of the House and Senate, and, if passed, to a conference committee that would reconcile differences in the bills.

It’s at that final stage where many expect the real deal will be cut.

“We’ve got ourselves a real health care shooting war now,” said Robert Laszewski, a former health insurance executive turned consultant. “The industry has come to the conclusion that the way things are going in Congress, we’ll have a … formula that will be disastrous for their business, so they can’t stand on the sidelines any longer.”Image
Questions about the technical soundness of the industry analysis by the PricewaterhouseCoopers firm was a big part of the discussion Monday. The release of the study late Sunday on the eve of the federal Columbus Day holiday had Democrats crying foul.

“The misleading and harmful claims made by the profit-driven insurance companies are politicking for corporate gain at its worst,” said Sen. Jay Rockefeller, D-W.Va.

Democrats have reason to worry. Insurance industry opposition helped sink President Bill Clinton’s health care plan in the 1990s by fanning fears that people with coverage would wind up paying more.

Ignagni was unequivocal in her support for the Price water house Coopers conclusions. The company is “a world-class firm” with “a stellar reputation,” she said.

The study projects that the legislation would add $1,700 a year to the cost of family coverage in 2013, when most of the major provisions of the Baucus bill would be in effect.Premiums for a single person would go up by $600 more than would be the case without the legislation, it estimated.

Click here for full report

Soda Tax Could Combat Obesity

July 27, 2009

CBS News

by Stephanie Condon

While Democrats await the results of bipartisan negotiations over health care reform in the Senate Finance Committee, one of the proposals put before the committee received a nod of approval from health officials today: taxing soda.

The committee — the last congressional panel expected to produce its own recommendations for health care reform — listened to arguments earlier this year both for and against imposing a three-cent tax on sodas as well as other sugary drinks, including energy and sports drinks like Gatorade.

The Congressional Budget Office estimates that a three-cent tax would generate $24 billion over the next four years, and proponents of the tax argued before the committee that it would lower consumption of sugary drinks and improve Americans’ overall health.

At the Centers for Disease Control and Prevention’s “Weight of the Nation” conference today, CDC chief Dr. Thomas Freiden said increasing the price of unhealthy foods “would be effective” at combating the nation’s obesity problem, reports CBS News chief political consultant Marc Ambinder.

Freiden said he was not endorsing the tax as a member of the administration but was “just presenting the science,” according to Ambinder. He also said policies that would reduce the cost of healthy foods would effectively bring down obesity rates.

Obesity-related health spending reaches $147 billion a year, double what it was nearly a decade ago, according to a study published Monday by the journal Health Affairs.

Given that evidence, the argument goes, a soda tax could plausibly pay for health care reform both by raising revenues and bringing down the medical expenses associated with obesity.

“It is extremely difficult in reality to make such a snapshot estimate of something so complicated as obesity,” Ambinder notes. “This is one reason why researchers in the field tend to focus on suffering and disparities within populations, rather than aggregate cost.”

Even though the growth rates of American obesity are leveling off overall, he points out, the rate is not slowing among African American women, Hispanics, Native Americans, or among poorer Americans.

Those opposed to the soda tax, however, are also emphasizing the impact it could have on poor Americans. The American Beverage Association, which strongly opposes the tax, told the Wall Street Journal the tax would hit poor Americans the hardest.

The association announced this month it has formed a coalition called Americans Against Food Taxes to oppose the soda tax, the Hill newspaper reported. Made up of 110 organizations opposed to raising taxes on food and beverages to pay for health reform, the group is running an advertisement that shows a family enjoying soda on a camping trip.

Given the current state of the economy, the ad says, “this is no time for Congress to be adding taxes on the simple pleasures we all enjoy.”

Click here for the full report from CBS News.

Familiar Players in Health Bill Lobbying

July 6, 2009

Washington Post

By Dan Eggen and Kimberly Kindy

The nation’s largest insurers, hospitals and medical groups have hired more than 350 former government staff members and retired members of Congress in hopes of influencing their old bosses and colleagues, according to an analysis of lobbying disclosures and other records.

The tactic is so widespread that three of every four major health-care firms have at least one former insider on their lobbying payrolls, according to The Washington Post’s analysis.

Nearly half of the insiders previously worked for the key committees and lawmakers, including Sens. Max Baucus (D-Mont.) and Charles E. Grassley (R-Iowa), debating whether to adopt a public insurance option opposed by major industry groups. At least 10 others have been members of Congress, such as former House majority leaders Richard K. Armey (R-Tex.) and Richard A. Gephardt (D-Mo.), both of whom represent a New Jersey pharmaceutical firm.

The hirings are part of a record-breaking influence campaign by the health-care industry, which is spending more than $1.4 million a day on lobbying in the current fight, according to disclosure records. And even in a city where lobbying is a part of life, the scale of the effort has drawn attention. For example, the Pharmaceutical Research and Manufacturers of America (PhRMA) doubled its spending to nearly $7 million in the first quarter of 2009, followed by Pfizer, with more than $6 million.

The push has reunited many who worked together in government on health-care reform, but are now employed as advocates for pharmaceutical and insurance companies.

A June 10 meeting between aides to Baucus, chairman of the Senate Finance Committee, and health-care lobbyists included two former Baucus chiefs of staff: David Castagnetti, whose clients include PhRMA and America’s Health Insurance Plans, and Jeffrey A. Forbes, who represents PhRMA, Amgen, Genentech, Merck and others. Castagnetti did not return a telephone call; Forbes declined to comment.

Also inside the closed committee hearing room that day was Richard Tarplin, a veteran of both the Department of Health and Human Services and the Senate, where he worked for Christopher J. Dodd (D-Conn.), one of the leaders in fashioning reform legislation this year. Tarplin now represents the American Medical Association as head of his own lobbying firm, Tarplin Strategies.

“For people like me who are on the outside and used to be on the inside, this is great, because there is a level of trust in these relationships, and I know the policy rationale that is required,” Tarplin said in explaining the benefits of having government experience.

But public interest groups and reform advocates complain that the concentration of former government aides on K Street has distorted the health-care debate, and that it further illustrates the problem posed by the “revolving door” between government and private firms.

“The revolving door offers a short cut to a member of Congress to the highest bidder,” said Sheila Krumholz, executive director of the Center for Responsive Politics, which compiled some of the data used in The Post’s analysis. “It’s a small cost of doing business relative to the profits they can garner.”

Click here for the full story from the Washington Post.