Health Insurers Funded Chamber Attack Ads

Published on
by
The National Journal

Health Insurers Funded Chamber Attack Ads

by
Peter H. Stone

AHIP President Karen Ignagni. Despite promises to the White House that the major health insurance companies would play nice on healthcare, they quietly pushed funds to third-parties for ads attacking reform. "There's no question that AHIP has quietly solicited monies from their members which were funneled over to the chamber for their ads," said a source. The total donated by the health insurers, according to one estimate, was as much as one-quarter of the chamber's total health care advertising budget.

Just as dealings with the Obama administration and congressional
Democrats soured last summer, six of the nation's biggest health
insurers began quietly pumping big money into third-party television
ads aimed at killing or significantly modifying the major health reform
bills moving through Congress.

That money, between $10 million and $20 million, came from Aetna,
Cigna, Humana, Kaiser Foundation Health Plans, UnitedHealth Group and
Wellpoint, according to two health care lobbyists familiar with the
transactions. The companies are all members of the powerful trade group
America's Health Insurance Plans.

The funds were solicited by AHIP and funneled to the U.S. Chamber of
Commerce to help underwrite tens of millions of dollars of television
ads by two business coalitions set up and subsidized by the chamber.
Each insurer kicked in at least $1 million and some gave
multimillion-dollar donations.

"There's no question that AHIP has quietly solicited monies from
their members which were funneled over to the chamber for their ads,"
said a source. The total donated by the health insurers, according to
one estimate, was as much as one-quarter of the chamber's total health
care advertising budget.

A spokesman for Kaiser said it contributed funds to AHIP last year
for positive ads on health care reform, and that AHIP has told the
insurer that none of its monies were sent to the chamber.

Last August was bruising for the health insurance industry: Obama
and congressional leaders attacked its abuses and profits and AHIP
President Karen Ignagni warned publicly that "the vilification strategy isn't going to get health reform passed."

In late October, Ignagni wrote in a letter to the Washington Post
defending a health insurer-funded study critical of congressional cost
estimates, "Let me be clear and direct, health plans continue to
strongly support reform." However, by that time money was already
flowing through AHIP to the chamber to fund its negative ads.

The fundraising started last September and continued through
December using AHIP as a conduit to avoid a repeat of the political
flak that hit the insurance industry after it famously ran its
multimillion-dollar "Harry and Louise" ads to help kill health care
reforms during the Clinton administration.

"AHIP wanted to do this through a third party because of what
happened with the Harry and Louise ads," said a lobbying source. "The
goal was to get a message out there to make sure the public understood
the serious shortcomings of the legislative proposals."

Asked about the health-insurer funding for its ad blitz, the chamber's top lobbyist Bruce Josten said, "No comment. We never disclose funding or what we're going to do."

AHIP did not return several calls requesting comment for this story.
Publicly, the group has stressed repeatedly that it supports health
care reform legislation, but it has significant problems with the bills
that the House and the Senate have passed that are now in the process
of being melded together.

Since last summer, the chamber has poured tens of millions of
dollars into advertising by the two business coalitions that it helped
assemble: the Campaign for Responsible Health Reform and Employers for
a Healthy Economy.

In late October, the chamber helped cobble together a larger
coalition, Employers for a Healthy Economy, which became the key
advertising vehicle for attacking provisions in the House and Senate
bills being developed. The newer coalition includes such business
giants as the National Association of Manufacturers, the National
Retail Federation and the National Association of
Wholesaler-Distributors.

The ads sharply criticized the high costs of the separate bills,
especially the House version. The commercials warned the legislation
would raise taxes for Americans and hurt the economy as it tries to
recover from the recession. And some chamber-financed commercials
attacked setting up a government run plan to compete with private
insurers -- a special sore point for the insurance industry -- which is
part of the House measure.

The U.S. Chamber has spent approximately $70 million to $100 million
on the advertising effort, according to lobbying sources. It's unclear
whether the business lobby group went to AHIP with a request to help
raise funds for its ad drives, or whether AHIP approached the chamber
with an offer to hit up its member companies.

The House passed its health care reform measure in November; the
Senate's didn't pass its version until December. Late last week,
Employers for a Healthy Economy launched a new round of TV ads on
national cable that are slated to run for a week. Sources say that the
chamber-backed ads will likely continue as the two bills are combined
in coming weeks.

"You don't quit. You fight this thing all the way," said Dirk Van Dongen, the president of the Wholesaler-Distributors.

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