The Big Money Speaks

Yesterday, the first ad debuted in what is being described as a $12 million campaign in favor of the Democrats’ health plans. After an August of angry public meetings, September looks to be the month when the big money is heard.

Yesterday, the first ad debuted in what is being described as a $12 million campaign in favor of the Democrats’ health plans. After an August of angry public meetings, September looks to be the month when the big money is heard.

The agitated right may fulminate about liberty vs. tyranny, but from the point of view of the people with advertising dollars to spend, the healthcare debate has resolved itself to insurers vs. PhRMA. The White House has pledged to protect PhRMA's interests, and PhRMA in turn has reportedly pledged $150 million in promotional cash in support of the White House’s healthcare plans. (If they are shrewd, they might invest a million or two to persuade the American Conservative Union to switch sides.)

PhRMA wins because they have been assured they will not face forced price reductions.  By contrast, health insurers lose big under the White House plans. The White House seeks to find money for reform by squeezing costs out of Medicare. The lead target: privately administered Medicare Advantage plans.  About one-fifth of seniors are enrolled in these plans, at significantly greater benefit to them and significantly higher cost to the taxpayer. Over half of all Medicare Advantage participants are enrolled in plans insured by four companies: UnitedHealth Care, Blue Cross/Blue Shield affiliates, Humana Inc., and Kaiser Permanente. They stand to lose a great deal from the White House’s proposals.

Of course there’s principle at stake too. But principles do not pay the rent – and in Washington, the rent always gets paid.