Who Will Be at the Table? Part I

Drug companies eye a large chair

During the campaign, Barack Obama promised his cheering crowds that, when he rolled up his sleeves to work on health care, he would “have insurance company representatives and drug company representatives at the table. They just won’t be able to buy every chair.” During the campaign, little was written about health care special interest groups. Now is a good time to take a look at just what kind of seats they will have at Obama’s table, and what they’re doing to bring the public around to their ways of thinking. This is the first of an occasional series of posts that will look at their activities and how the media are covering them. The entire series is archived here.

The special interests that have the most to gain or lose from health reform have been pretty quiet all year. Aside from giving gobs of money to Obama’s campaign, they apparently have been content to let the candidates duke it out before sending in the heavy lobbying artillery. They’ve projected a positive, conciliatory, almost reform-friendly image. America’s Health Insurance Plans agrees that everyone should have access to coverage, and now, with some conditions, insurers are willing to cover everyone; the American Medical Association, which calls itself the Voice For The Ininsured, says it wants to give all Americans the means to purchase health care coverage. But they haven’t really telegraphed the punches they plan to throw in what will be a high stakes fight. Thanks to the drug industry, that’s about to change.

A few days ago, The Washington Times reported that Big PhRMA, known formally as the Pharmaceutical Research and Manufacturers of America, is launching a mega-million dollar PR blitz to promote the benefits of the free market. “We’re going to do an ad campaign that is designed to make people aware of the importance of preserving your free-market health care system,” PhRMA senior vice president Ken Johnson told The Times. Johnson said there was no question that next year would be challenging. Drug makers are about to minimize the challenge in ads that will not criticize the Obama Administration or any of its health proposals. The ads feature TV talk show host and PhRMA spokesman Montel Williams; in one, Williams says everyone should have affordable health insurance and “doing what’s best for patients is what’s best for everyone.” In other words, the pitch is soft and subtle.

That seems to fit perfectly with another warm and fuzzy PhRMA PR endeavor—its very public support for expanding the State Childrens’ Health Insurance Program (SCHIP). How can you miss with that? Twice in 2007 Congress passed a bill that would have provided coverage to more kids; twice it was vetoed by President Bush. As the fight to expand SCHIP got rough, PhRMA earned its bona fides as a kids champion. It sponsored TV commercials and print ads to improve awareness of SCHIP, and its president, former congressman Billy Tauzin, proclaimed: “For parents, there is no greater issue of importance than ensuring the health of their children.” Touching.

This year, PhRMA went one better and funded a group called America’s Agenda: Health Care for Kids, which, The Wall Street Journal reported, was founded only this past September with PhRMA as its sole funder. With some $11 million from PhRMA, the group produced commercials that
thanked twenty-eight politicians for supporting SCHIP expansion. All but three were Democrats.

“The SCHIP ads are about good policy,” Johnson told the Journal. “We are trying to promote programs that encourage greater access to health care.” The drug makers may be building greater access for themselves. As the Journal reported, some legislators thanked in the ads are in critical positions to influence legislation—Maine Sen. Susan Collins and North Dakota Sen. Byron Dorgan, who co-sponsored a bill to import cheaper drugs from Canada, and Montana Sen. Max Baucus, who chairs the Senate Finance Committee that will deal with some of the industry’s key concerns.

PhRMA gave some $1.6 million to Obama’s presidential campaign, triple what it gave John McCain. Johnson was candid about his group’s agenda:

We’ve been moving the pieces on the chess board around for some time now getting ready for next year, and we’ve got a great game plan in place. We think we’ve earned a right at the table, and we’re optimistic that at the end of the day, the majority of members of Congress will recognize the importance of the pharmaceutical industry to health care.

So what are they worried about? The president-elect has said he favors price negotiations between Medicare and the drug companies, which some experts believe will lead to somewhat lower prices for prescription drugs for seniors and lower government outlays for Medicare’s prescription drug benefit. The 2003 law that provided for the benefit banned price negotiations. The Boston Consulting Group estimates that price negotiations could lower drug maker annual revenues by $10 to $30 billion. Ah, the loser thing again! What’s a few million to persuade the public how much you care about kids when that expense can help you pocket billions?

Meanwhile, seniors—who still must pay some of the costs for the drug benefit—will see those costs go up next year. For some, monthly premiums will rise on average 43 percent; for others, the premiums may increase by more than 300 percent. Seniors are also required to pay a portion of the drug price at the pharmacy. Those amounts are going up too.

Linking all the pieces calls for some connecting-the-dots reporting. Let’s get on with it.

Has America ever needed a media watchdog more than now? Help us by joining CJR today.

Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman.