Tensions brewing between Republicans and CEOs over healthcare reform bill

Tension between Republicans and the nation’s top CEOs over healthcare reform escalated this week when the executives released a report praising aspects of President Barack Obama’s top initiative.

Republicans in Congress and some of their business allies in Washington are fuming over a new report commissioned by the Business Roundtable (BRT), an organization that represents more than 50 of the nation’s biggest corporations.

The report claims that parts of the Democratic legislation could cut healthcare costs substantially.

Obama on Thursday seized on the findings, issuing a statement that notes the report found future healthcare costs could fall by $3,000 per employee with passage of the legislation.

The report was released two weeks after Senate Republicans voiced frustration with the CEOs for not doing more to oppose Democratic healthcare proposals, prompting more criticism from the party that traditionally is aligned with the top executives.

A senior Senate GOP aide on Thursday said: “The bottom line is that these policies the administration is advocating is not going to be helpful to businesses. Is it disappointing that groups are cutting deals with the administration instead of looking at the realities of how the policies will affect their members? Absolutely.”

Another senior GOP Senate aide said he could not understand why the group issued a report that gives the administration support in its push to overhaul the nation’s healthcare system.

“The Business Roundtable really should’ve learned from Bob Dole, Bill Frist, and Tommy Thompson that the mere mention of support for any aspect of health reform will be misconstrued by this administration to mean they’re on board with a trillion dollar government takeover,” said the aide, making reference to statements from former GOP officials, which Democrats then used to pressure Republicans on the Hill.

While the 24-page report does not specifically back any of the Democratic healthcare measures, it cites cost-cutting provisions in the legislation that could lower the “trend line” of rising employer healthcare costs, which it predicted could reach an average of $28,530 per employee by the year 2019.

“We estimate that if enacted properly, the right legislative reforms could potentially reduce that trend line by more than $3,000 per employee, to $25,435,” the report stated.

The Business Roundtable, which has been a longtime ally of the GOP in battles against Democrats over tax regulations, declined to comment for this story. Its member companies include AT&T, Chrysler Group, General Electric, Johnson & Johnson and Pfizer.

The group maintains, however, that its study of the economic impact of healthcare reform is not driven by any political agenda. A source said Antonio Perez, chairman of the group’s Consumer Health and Retirement Initiative, simply wanted to look at what the proposed reforms might cost.

GOP aides say the party’s relationship with the business association has deteriorated in recent weeks as the Roundtable continues to work with Democrats in the White House and on the Hill to advance healthcare reform.

GOP lawmakers have become increasingly critical of the Roundtable for failing to take more of an active role in standing up to Obama on healthcare reform. But several said they were disappointed and perplexed by the business group’s latest action: the release of a report that gives Obama valuable rhetorical ammunition against Republicans.

Obama and Democrats wasted little time taking advantage of the report.

“A new report released today by the Business Roundtable underscores what experts and businesspeople have told us all along – comprehensive health insurance reform is one of the most important investments we can make in American competitiveness,” Obama said in a statement Thursday.

Senate Finance Committee Chairman Max Baucus (D-Mont.) echoed that point.

“Employers are standing behind health reform because they know it will mean more predictable and affordable healthcare costs that can boost U.S. competitiveness and create jobs at home,” Baucus said Thursday. “Today’s report from the Business Roundtable found that reform could save U.S. businesses as much as $3,000 per employee and slow the growth of business healthcare costs by more than half.”

Executives at other pro-business groups criticized the report as a piece of political gambit instead of an impartial study.

“I do not for the life of me know why the Business Roundtable felt compelled to claim that the pending legislation would drive down costs; there is no empirical data showing that will happen,” said the executive of one group that has often worked with the Roundtable. “This report is based more on political calculation than empirical evidence.”

Other business groups have taken a strongly critical stance against the Democratic healthcare reform legislation. A coalition of 11 business groups, including the U.S. Chamber of Commerce, the National Federation of Independent Business (NFIB), and the National Association of Manufacturers, launched three new ads Thursday criticizing Democratic reform proposals.

One of the ads, running on national cable and in 10 states, warns “Congress’ latest healthcare bill makes a tough economy worse” and that “health insurance costs will skyrocket.”

GOP leaders have made a concerted effort in recent weeks to urge business groups to take a more active role in opposing Democratic plans.

Senate Republican leaders on Oct. 20 called representatives from the Business Roundtable, NFIB and other business groups to a meeting at the Capitol to find out what they planned to do during the upcoming Senate floor debate on healthcare reform, according to sources familiar with the discussion.

A former Senate GOP leadership aide said Republican leaders are “very angry” with the Roundtable for working with the administration.

“The relationship has been good until recently because they haven’t stepped up to the plate to help Republicans with the principles they both agree on,” said the former aide. “The BRT is playing politics more liberally than our side thought they would have.”