The Rose Garden: Administration Exaggerates Alliances on Reform

Posted July 24, 2009 at 6:27pm

President Barack Obama and his aides have repeatedly suggested that major health organizations are with them on health care reform, but an analysis of these groups’ positions suggests few are completely on board and several may oppose the president in the end.

[IMGCAP(1)]Obama and his aides do not explicitly say health providers like hospitals and drugmakers back the president’s proposals. But it would take a careful reading of comments out of the White House to understand this. Obama and his aides frequently associate these groups with their reform effort, creating an unmistakable impression that the health organizations that could sink the health care overhaul will not oppose Obama’s plans.

“There’s always going to be some interest out there that decides, you know what, the status quo is working for me a little bit better,— Obama said during last Wednesday’s East Room news conference. “And the fact that we have made so much progress where we’ve got doctors, nurses, hospitals, even the pharmaceutical industry, AARP, saying that this makes sense to do, I think means that the stars are aligned and we need to take advantage of that.—

At a White House event July 8, Vice President Joseph Biden also suggested an alliance with health providers.

“We have these hospitals working with us, and we have the pharmaceutical industry working with us,— Biden said. “We have doctors and nurses and health care providers with us.—

Obama and Biden were echoing comments that aides have made to lawmakers in selling his health care initiative, according to Congressional sources.

The White House has also carefully staged events with health care providers, reinforcing the impression that everyone is on the same team.

Biden’s comments came during an appearance at the White House with hospital officials at which it was announced that hospitals would agree to “contribute— $155 billion to health reform — as long as increased coverage defrays the costs of all those uninsured people being dumped into hospital emergency rooms whenever they need medical attention.

The Biden event followed a June 22 appearance at the White House with Obama and pharmaceutical industry officials where the president praised their decision to provide $80 billion to help seniors buy drugs and close the Medicare “doughnut hole.—

On May 11, Obama was at the White House with doctors, drugmakers and hospital officials to tout an initiative to keep down costs. Even private health insurers — who now fully oppose Obama’s plans for a government insurance option and who are regularly bashed by the president for getting paid too well — were on hand at the event.

And yet, the Pharmaceutical Research and Manufacturers of America, the drug industry’s trade group, opposes the main Democratic bill in the House, which Obama has endorsed. And while PhRMA has not come out against Obama-backed legislation passed by the Senate Health, Education, Labor and Pensions Committee, it has declined to support it.

While optimistic about being able to back legislation at the end of the process, PhRMA has grave concerns about any bill that would make a government insurance option so attractive that it wrecks the current employer-provided health system by luring people from private insurers — which is exactly what Republicans say a public option would do.

“We have not come out in opposition to a public plan,— PhRMA Senior Vice President Ken Johnson said. “We have not spent a penny lobbying against it.—

But, he notes, “We have concerns about any scheme that drives people out of employer-provided insurance into a public plan.—

PhRMA is optimistic that the Senate Finance Committee will come up with a bipartisan initiative that will serve as a “blueprint— for reform that will lead to a final bill that it can support, Johnson said.

But others are not so sanguine and believe the Finance bill will inevitably move to the left after it is combined with the HELP bill and legislation that passes the House.

The American Hospital Association, which has not endorsed either the HELP or the House bills, has made clear that it will only accept the right type of public insurance option.

“The AHA has serious concerns, however, about establishing a new public plan that could exacerbate the underpayment of providers by paying rates at Medicare or Medicaid levels,— an AHA position paper on health reform states. “The scope of such a plan should be limited to the uninsured, the self-employed and small businesses.—

Obama and his Democratic allies back a government option that would be available to all and compete directly with private insurers in the marketplace — not what the AHA has in mind.

It is not even clear what the American Medical Association — which says it supports the House legislation — will back in the end. In a July 22 letter to the Wall Street Journal, AMA President James Rohack suggested that at least part of his group’s support for the House bill is based on moving the process along, calling the measure a “starting point.—

“I’d like to share the American Medical Association’s rationale for supporting the House health-care bill,— he wrote in response to a Wall Street Journal editorial that criticized the reform efforts in Congress. “Without a bill that can pass the House, there will be no health reform this year. The House bill is an important starting point. The AMA will stay engaged to improve the final bill for patients and physicians.—

While the health providers take the high road, it has been left to their friends in the business associations — which many of them belong to — to unload against Obama’s proposals. The U.S. Chamber of Commerce is dropping $2 million for ads in just five states to combat the public option. It remains an open question whether health providers that may seem to be in league with the White House will join the opposition.