Reid picks his battles on health

Senate Majority Leader Harry ReidHarry Mason ReidLobbying World Mitch McConnell is not invincible Seven big decisions facing Biden in 2020 primary MORE is keeping a brutal fight with the insurance industry out of the broader healthcare debate, mindful that including it could sink President Barack ObamaBarack Hussein ObamaPelosi receives John F. Kennedy Profile in Courage Award Romney: Trump 'has distanced himself from some of the best qualities of the human character' Biden calls for unity, jabs at Trump in campaign launch MORE’s signature domestic priority.

Reid (D-Nev.), who will play a key role crafting the final Senate healthcare overhaul in the next few weeks, is excluding a proposal to repeal a loophole that exempts health insurance companies from federal antitrust laws.

 

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Although the proposal is very popular with Democrats and liberal groups, Reid has concerns that attaching it to the healthcare legislation risks damaging prospects for an effort already facing significant hurdles.

Republicans say Reid is being calculated in a different manner, dangling the standalone bill as a way of intimidating the companies into making concessions on Obama’s broader healthcare objective. But they will have to overcome recent testimony from former Senate Republican Leader Trent Lott, who backed a broader effort to lift the exemption for the entire industry.

 So far the powerful insurance industry has held back waging a full-out battle against Democratic health reform proposals because companies stand to gain tens of millions of new customers. But adding language that would open health insurance companies to prosecution by the Justice Department would provoke a strong counterattack from the industry.

 Reid has long argued that health insurance companies are able to gouge consumers because they are not subject to the Sherman Antitrust Act, which outlaws trusts and monopolies that stifle competition.

 “They could be conspiring to fix prices as they do every day and not a single thing could be done about it because they are not subject to the law like everybody else,” Reid told a crowd of healthcare workers at a Tuesday rally.

 “The only business that has a sweetheart [deal such as] they have is Major League Baseball. So is it any wonder that the biggest burden we have to fight [on] the healthcare reform issues that we have is the insurance industry? Of course not.”

 But senior Democratic aides said that Reid would not include legislation repealing antitrust exemptions for the health insurance industry in the healthcare package he will bring to the Senate floor.

 “The bill has enough problems,” said a Democratic aide, in reference to a bill pending in the Senate Finance Committee that has drawn an array of Democratic criticisms and failed to pick up any Republican support.

 Many Senate Democrats strongly support the antitrust legislation, which Senate Judiciary Committee Chairman Patrick LeahyPatrick Joseph LeahyOvernight Defense: Congressional leaders receive classified briefing on Iran | Trump on war: 'I hope not' | Key Republican calls threats credible | Warren plan targets corporate influence at Pentagon Key Republican 'convinced' Iran threats are credible Graham, Leahy request briefing on decision to yank personnel from Iraq MORE (D-Vt.) introduced last week. Seven other Democrats have signed on as co-sponsors, including Senate Democratic Whip Dick DurbinRichard (Dick) Joseph DurbinLet's stop treating student borrowers like second-class citizens Trump's immigration push faces Capitol Hill buzzsaw Hillicon Valley: Trump takes flak for not joining anti-extremism pact | Phone carriers largely end sharing of location data | Huawei pushes back on ban | Florida lawmakers demand to learn counties hacked by Russians | Feds bust 0M cybercrime group MORE (Ill.) and Sen. Charles SchumerCharles (Chuck) Ellis SchumerSchumer wants investigation into Chinese-designed New York subway cars Getting serious about infrastructure Schumer calls on McConnell to hold vote on Equality Act MORE (N.Y.), vice chairman of the Democratic Conference.

 

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Reid has also signed on as a co-sponsor, but he must balance his support for the legislation with the delicate calculus required to muster enough votes to pass a broader healthcare reform package.

 Health insurance companies and HMOs employ 1,795 lobbyists, according to a new report by Public Campaign Action Fund, a group that tracks lobbying expenditures and fundraising.

 The report found that health insurance companies and HMOs spent $126 million on political campaign contributions and lobbying expenses in the first half of 2009.

Richard Kirsch, the national campaign manager of Healthcare for America Now, a coalition of liberal groups and labor unions, said the Senate Finance Committee’s healthcare bill would do little to rein in the insurance industry.

 “The insurance industry is doing pretty well; they’re getting a lot of what they want in the Finance bill,” said Kirsch. “Their ability to weaken the legislation is one more argument for taking them on directly” by repealing antitrust exemptions.

 A report by Healthcare for America Now found that 94 percent of the insurance markets across the nation are not competitive under Justice Department standards.

 The Leahy legislation would repeal antitrust exemptions for health insurance and medical malpractice insurance companies, opening them to investigations for price-fixing, bid-rigging and reserving various portions of the market for different companies.

 Democratic Sens. Dianne FeinsteinDianne Emiel FeinsteinSenate confirms Rosen for No. 2 spot at DOJ Senate confirms controversial 9th Circuit pick without blue slips Graham warns of 5G security threat from China MORE (Calif.), Russ Feingold (Wis.), Maria CantwellMaria Elaine CantwellDon't revive logging in national forests Top Finance Dem offers bill to help those repaying student loans save for retirement Facebook COO Sheryl Sandberg meets with senators on privacy MORE (Wash.) and Arlen Specter (Pa.) have also endorsed the legislation, as have liberal groups such as the Consumer Federation of America.

 

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Republicans charge the legislation would destroy the industry.

 “Some of my colleagues would like to destroy the insurance industry because they want a government-run healthcare system,” said Sen. John CornynJohn CornynTrump's immigration push faces Capitol Hill buzzsaw The Hill's Morning Report - Presented by Pass USMCA Coalition - Restrictive state abortion laws ignite fiery 2020 debate Sinema, Gallagher fastest lawmakers in charity race MORE (R-Texas), a member of the Senate Finance panel.

 Cornyn said that Reid is waving the threat of antitrust legislation to cow the industry into making more concessions on healthcare reform.

 “We all understand what he’s trying to do — it’s an intimidation tactic,” Cornyn said.

 Sen. Chuck GrassleyCharles (Chuck) Ernest GrassleyOvernight Defense: Trump rails against media coverage | Calls reporting on Iran tensions 'highly inaccurate' | GOP senator blocking Trump pick for Turkey ambassador | Defense bill markup next week Trump reaches deal to lift steel, aluminum tariffs on Mexico, Canada Top GOP senator blocking Trump's pick for Turkey ambassador MORE (Iowa), a Republican member of the Finance Committee who was part of negotiations that produced the pending healthcare bill, said that insurance companies are supportive of the legislation as it stands.

 He said the insurance industry would accept legislation prohibiting it from discriminating against customers because of pre-existing medical conditions in exchange for a government mandate that requires tens of millions of Americans to sign up for coverage.

 In the past, some Republicans have supported a review of antitrust exemptions for health insurance companies.

 As a senator, Lott (R-Miss.) in 2007 co-sponsored legislation with Leahy that would have repealed an even broader swath of antitrust exemptions benefiting the entire insurance industry.  Lott said that if the industry were not engaging in price-fixing and market allocation, it would not have to worry about losing antitrust exemptions.

“I cannot for the life of me understand why we have allowed this exemption to stay in place so long,” Lott testified in March 2007 before the Judiciary Committee.