With Congress set to debate “Medicare-for-all,” Tarbell examines efforts by health insurers to take over past health care reforms.
By Michael Corcoran, Tarbell
In January, dozens of new Democrats will enter the U.S. House of Representatives with their party in control. While their leadership has resisted pushing major health care reform since passing the Affordable Care Act, many of these just-elected lawmakers campaigned to enact “Medicare-for-all,” or a government-run, single-payer system.
A constellation of health care industry groups worth hundreds of billions of dollars sees the progressives as a threat to their profits. Just as they did in 2008 to fight a public option in the Affordable Care Act, these industry groups have come together to make sure single-payer never becomes law. If squashing single-payer outright fails, its proponents fear that these groups — which are adept at manipulating reform movements — will seamlessly maneuver to other proven tactics.
Tarbell has looked back at years of health care industry spending to influence insurance reform, from Romneycare in Massachusetts to Obamacare in Washington, to offer insight into how these wealthy special interests will again try to preserve their privileged status as profitable middlemen or, failing that, control the reform debate.
They could highjack “Medicare-for-all” by funding studies from liberal think tanks, a prominent tactic in the seminal Romneycare reform in Massachusetts. The industry and its allies have already worked to blur the meaning of “Medicare-for-all” to include reforms that leave the power of the industry largely intact.
“Medicare-for-all” was introduced in the House in 2003, and everybody knew what it meant. It was a synonym for single-payer,” Dr. Adam Gaffney, president of Physicians for a National Health Program, told Tarbell. “Now people keep changing the definition and it drives me a little bonkers.”
With the meaning of “Medicare-for-all” diluted, there are hints at how private industry could work to ensure that any future health care reforms benefit them.
When Vermont was well into a legislative push (later abandoned) for a statewide health insurance plan in 2011, Leigh Tofferi, a Blue Cross Blue Shield lobbyist in the state said, “If there’s a single-payer system, we’d like to be the single payer.” The political landscape in Vermont is unique, but this comment offers a glimpse into how the insurance industry might try to adapt in a world where single-payer — or something called single-payer — becomes a consensus position.
“The industry is happy to help expand coverage to everyone — so long as it is accomplished by providing insurers with new customers,” Donald Berwick, director for the Centers for Medicare and Medicaid Services under Barack Obama, told Tarbell. “What makes them nervous is anything that goes in the other direction and limits or eliminates the role of the industry.”
Shaping Romneycare
More than a decade ago, progressives touted Massachusetts’ bipartisan health care reform.
In 2006, the Massachusetts Health Care Reform Law, now known as Romneycare, mandated that most adults had to buy health insurance and created government-subsidized plans. Liberal icon Sen. Ted Kennedy posed with then Governor Mitt Romney at the signing. The Boston Globe’s editorial board praised the state’s “health care heroes.” National media was flattering too. Two years before Washington would become consumed in a bitterly partisan debate about a similar law, the Affordable Care Act, only two of the Massachusetts legislature’s 194 members voted no on Romneycare.
Romney said the state law was an example of how to achieve universal health care without a single-payer approach. The model’s impact on patients and taxpayers continues to be debated, but many industry watchers point to at least one clear winner of the last decade in Massachusetts: private insurers.
“It was good for big research hospitals, but financially disastrous for safety net hospitals serving marginalized communities,” Benjamin Day, the onetime head of single-payer advocacy group MassCare, told Tarbell. “It improved access to care for a small percentage of the population, but also led to the rapid expansion of high-deductible plans.”
Prior to Romneycare, the single-payer movement had momentum in Massachusetts. A ballot referendum being readied for November 2006 could have called for the “right to health care” in the state. The state Democratic Primary had single-payer on the platform. Groups like Physicians for a National Health Program and Healthcare-Now have roots in the Boston area.
Instead, the Massachusetts law was a different kind of turning point in health reform: Its “market solution” became the consensus position for the Democratic Party. Today, Democratic national leaders refuse to place “Medicare-for-all” on the party platform, and instead promise to further strengthen the Affordable Care Act — the national law known as Obamacare, that mirrored its Massachusetts predecessor in many ways. The ACA has also benefited the industry financially and complicated life for single-payer advocates.
If the phrase “Medicare-for-all” is not well understood, Democrats — with industry support — can portray most any kind of reform as a “Medicare-for-all” plan. Lobbyists and insurance executives speak candidly about how they may maintain relevance in a post-single-payer world.
When Vermont looked like it might pass a quasi-statewide single-payer plan in 2011, Blue Cross Blue Shield of Vermont started to ponder how it might survive, or thrive, under such a system. Jon Margolis, a journalist at VTDigger, reported at the time that even “private insurance companies … cautiously welcomed” the proposal. “It’s not keeping me up at night,” said Bill Little, the Vermont vice president for MVP Health Care.
More recently, Aetna CEO Michael Bertolini, when asked about single-payer in a leaked audio file, replied: “Single-payer, I think we should have that debate as a nation.” He pointed to the managed care model used with Medicare and Medicaid. (Revenue from Medicaid managed care plans increased from $64 billion in 2011 to $207 billion in 2016.)
“If the government wants to pay all the bills, and employers want to stop offering coverage, and we can be there in a public-private partnership to do the work we do today with Medicare, and with Medicaid at every state level, we run the Medicaid programs for them, then let’s have that conversation,” Bertolini said.
Many Democrats who are hesitant to co-sponsor a single-payer bill speak about public option bills as being “something like a single-payer system.” The Texas Democratic Party platform calls for a “single-payeroption.” (The appeal of single-payer is that one large risk pool of insured people creates savings. If staying with a private insurer is an “option,” then multiple risk pools would remain and diminish the possible savings.)
Currently, there are at least five proposals that offer a public option in Congress. Many have names that sound like “Medicare-for-all.” The most high-profile example might be “Medicare Extra for All,” a plan put forward by the Center for American Progress, a liberal think tank that has received health insurance industry money in the past, and may still as many of its donors are undisclosed.
Gaffney warns this could lead to a watered-down “Medicare-for-all.”
“They want to have private insurers sell us de facto ‘Medicare-for-all’ plans,” he said. “That is what the CAP plan does. We know from experience that this is not going to work.”
Paying Liberal Think Tanks
The Center for American Progress isn’t the only progressive think tank that has engaged in the health care debate.
Leading up to Romneycare, the Blue Cross Blue Shield of Massachusetts Foundation commissioned the Urban Institute to prepare a 2005 report: “Roadmap to Coverage.” The report concluded that some combination of requiring everyone to purchase health insurance (an ACA mandate that congressional Republicans repealed in late 2017) and Medicaid expansion could lead to near-universal coverage.
According to Linda J. Blumberg, a fellow at the Urban Institute and one of the lead writers, the foundation — which was launched with $55 million from private insurer Blue Cross Blue Shield of Massachusetts in 2001 — was chosen to use their modeling to investigate ways to reach universal coverage in Massachusetts. The foundation “didn’t want us to look into single-payer … so we focused on other ideas that had grown in popularity,” she told Tarbell. The group ultimately recommended a mixture of an individual mandate, a Medicaid expansion and an insurance exchange for the individual market — effectively the template for the ACA.
“No reform is perfect, but I think in Massachusetts a lot of different groups and constituencies came together and found a way to expand coverage,” she said. “We didn’t know it would have the influence on national policy that it did. But we did want Massachusetts to take a lead on the issue.”
To this day, the Urban Institute does work on behalf of the Blue Cross Blue Shield Foundation, though their relationship with the industry, as clients and donors, has come under scrutiny. The Institute received donations from Blue Cross Blue Shield of Massachusetts and the company’s foundation, in sums between $100,000 and $449,000, according to its annual reports dating back to 2012.
The Urban Institute says its funders do not influence its conclusions or its publications and that it discloses funders when applicable. Still, in 2018, as in 2005, the Institute is advancing reform proposals that are friendly to health insurers, some of which help fund the think tank’s work.
“Big picture — this movement has really been growing leaps and bounds in two years, despite a bleak political landscape,” Day said, but “liberal think tanks have been terrible on this issue.”
Finding support from reports issued by liberal think tanks such as the Urban Institute and Center for American Progress allows market-friendly policies to be presented as progressive and forward thinking in the press and on social media. Their reports are often amplified by center-left writers like Paul Krugman or Ezra Klein.
The think tanks also write unfavorable reports on single-payer. On October 4th, the Urban Institute released a follow-up to a 2016 studythat was deeply critical of claims made by Bernie Sanders about the costs of his “Medicare-for-all” proposal.
“The political barriers to such a broad-based change, particularly moving from where we are now, may prove insurmountable. Several alternative approaches could dramatically reduce the number of uninsured, improve affordability and adequacy of coverage, further contain per capita health care spending, and have less impact on the federal budget,” the report, “Estimating the Cost of a Single-Payer Plan,” concluded.
The private health care sector is increasingly reluctant to appear hostile toward universal health care as the idea grows in popularity. ThePartnership for America’s Health Care Future, a coalition of the major health sectors, does not mention, let alone attack, single-payer health care on its website. It pleads that “access to quality, affordable health care isn’t a partisan issue – it’s an American issue,” and millions “rely on our current system to keep themselves and their families healthy.” (The Hill reported in August that the group’s sole purpose is to counter the policy.)
“It is about educating legislators and people about what [single-payer] is and what it is not,” Gaffney said, citing the confusion caused by think tanks and politicians who blur these distinctions. “Advocates are going to have their work cut out for them. We know [members of the private health industry] are organizing already. They will always have more money. We will need to be responsive to their many campaigns to undermine reform.”
This article was republished with the permission of Tarbell, which is pioneering journalism that informs, galvanizes and changes America.
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