The Financial War Against Universal Healthcare
Volunteers and voters are collateral damage
Health insurance is the business that fuels campaigns as well as news media through massive network ad buys. The influence of this industry seeps into nearly every level of our democratic process, affecting how and why decisions are made on Capitol Hill, the newsroom, and even at the local party level. Few fundamental changes in how the insurance industry operates are ever permitted. In the fight for healthcare reform, this pervasive influence has waged an all out war on Medicare for All.
Medicare for All, a proposal to improve the existing Medicare program and expand coverage to all Americans, enjoys wide bipartisan support with just over 78% of left-leaning and 56% of all American voters in favor of the proposed plan, making it the highest positive rating of all healthcare proposals under consideration. The proposal itself is not new. In fact, the original plan for our existing Medicare program included a phased eligibility approach to include everyone as early as 1965. That plan stalled early on so that today, only new immigrants to the United States over the age of 65 are allowed to buy coverage. Everyone else must wait to claim their benefits.
The Kaiser Foundation, a national healthcare advocate and healthcare provider, conducted a study in January 2019 to poll groups on various proposals, including a Medicare buy-in and expansion of Medicaid as a public option, to track the growing public support for the larger Medicare for All proposal. Medicare for All remains the leading plan most preferred by American voters nationwide. The reason is largely because the program itself is elegantly simple and the promise of ending the rampant fraud, waste, and abuse that costs the United States trillions every year is hard to ignore.
"I mean, I helped to write the Affordable Care Act, I’m naturally in favor of expanding it…”
This bipartisan voter support is causing a rift that will hamper efforts of both major parties going into the 2020 elections. The core issue is all about the money from insurance lobbyists, not the cost of the program itself, nor the complexities inherent in any national implementation plan.
The divide in Congress came to light when advocates of Representative Jayapal’s House Bill H.R. 1384 used their leverage to ask Speaker Pelosi to make good on her pledge to hold hearings. This allowed the House Ways and Means Committee Chair, Rep. Richard Neal from Massachusetts, to flex his own muscle and ask witness panels at the hearing to refrain from using the name, “Medicare for All” as he himself favors a buy-in option.
The Intercept’s Ryan Grim reported that Rep. Neal admitted, “That’s the emphasis. So we have not ruled anything out or ruled anything in. And we think that continuing to gathering information [sic] — I mean, I helped to write the Affordable Care Act, I’m naturally in favor of expanding it…”
Neal went on to tout the great success of Massachusetts’s healthcare program, saying that every child was covered and “97% of adults”, but the data tells a different story. According to the state’s own 2017 American Community Survey census, Neal’s district (MA01), has over 18,700 constituents who have no health insurance and 1,500 of these are children.
Money Equals Speech
Since the Supreme Court ruled that money equals free speech under the Citizens United decision, corporate lobbyists have been flooding money into the system, drowning out the average American, regardless of party affiliation.
For example, Congressman Neal did not mention his health insurance donors. According to data compiled by Open Secrets from Federal campaign reports, insurance companies ($379,650), pharmaceuticals and healthcare ($283,750), Massachusetts Mutual Life Insurance ($36,550) were among Neal’s top industry donors in 2017-18.
Insurance and pharmaceutical do not discriminate based on party affiliation. The likes of Congressman like Neal and others are no different than Republicans like Senator Mitch McConnel, who received over $955,000 in contributions from insurance professionals and related political action committees.
Throughout the same 2017-18 election cycle, insurance companies contributed over $60 million to candidates, with just 60% of that going to Republicans and the rest to Democrats. Blue Cross Blue Shield dominated the field, followed by professional insurance advisors, and insurance brokerage firms. None of these groups want to see a program like Medicare for All become a reality.
This ‘free speech’ influence is not limited to direct campaign contributions. Media outlets that own major news programming across the county have enjoyed a surge in direct to consumer advertising revenue. Health insurance and pharmaceutical companies, both industries heavily targeted by regulatory hurdles should Medicare for All become law, were subjects of the Journal of American Medical Association’s published study in 2018 that showed a dramatic increase in ad spending on behalf of these industries:
From 1997 through 2016, medical marketing expanded substantially, and spending increased from $17.7 to $29.9 billion, with direct-to-consumer advertising for prescription drugs and health services accounting for the most rapid growth, and pharmaceutical marketing to health professionals accounting for most promotional spending.
These kinds of ad dollars keep even trusted news outlets from operating impartially in their reporting.From ad revenue to campaign contributions, the influence of these titans is impossible to ignore. The voices missing in this cacophony are those the working families, retirees, and the disabled across the country who have lost total net worth over the last two decades while at the same time, have seen life expectancy rates decline.
This coalition of Congress and insurance companies against the taxpayers, regardless of political stripe, is well funded and heavily coordinated. They are clearly winning.
The Real Cost of Universal Care
A favorite pushback from party leaders focuses on two narratives: 'it will raise taxes,' and 'how are we going to pay for it?'
Both arguments are disingenuous and intended to stall serious discussions from moving forward. The reality is, most Americans today, even with employer-sponsored insurance plans, are spending an annual tax equivalent far above the proposed 6% for households and 9% for businesses. As a nation, we are already spending roughly twice the amount necessary to implement Medicare for All today.
What if raising taxes was not the only answer for funding this program? This is where Federal Appropriations becomes a key factor.
Congress members like to compare the Federal budget to household spending and nothing could be further from the truth. The reality is, no personal household can legally create money the way the Federal government can, and few members of Congress will even discuss the Federal Appropriations process. If they decide to spend millions on military hardware, no one ever cuts spending elsewhere or thinks to raise taxes to cover the cost. Instead, once the spending is approved by a vote in Congress, the funds are simply added to the Department of Defense budget.
“What they are telling us is, even with today’s budgets, without making any adjustments at all, we are not going to have an inflation problem..."
The same could be true for Federal investments in national infrastructure and healthcare. The result of these investments would mean an annual savings of $200 billion with Gross Domestic Product growth of 3% just by implementing Medicare for All alone.
Warren Mosler, a leading economist, engineer, and politician joined Real Progressives host, Steve Grumbine to talk about the tax funding required for Medicare for all.
Mosler shared his observations on the original proposal broached by Senator Sanders during his 2016 presidential campaign, asserting that the plan would result in a need to lower taxes, not raise them.“I see it as a highly deflationary event. I see three trillion spent on health care with a trillion going toward administration and that’s pretty much going to go away with Medicare for All… those are salaries in the private sector going to administration that aren’t going to be there anymore. That’s a highly deflationary event.”
He said, “You don’t raise taxes in that context. The deflationary bias, at least initially, will dominate.”
As for an increased Federal deficit and inflationary risk, Mosler points to the CBO and Federal indexes:
“Then they say, ‘What about the deficit? The public debt is a dollar spent by government that hasn’t been used to pay taxes yet…Look, the only problem deficit spending can cause is inflation. So, you look to the long term inflation forecast and that tells you if you have a deficit problem. The CBO says it would be 2%, the Fed says 2% and the precious ‘free market’ Treasury Bonds say something less than 2%. I don’t think 2% is an inflation problem.
“What they are telling us is, even with today’s budgets, without making any adjustments at all, we are not going to have an inflation problem. The burden of proof is on you to show there is an inflation problem.”
If that is true, then the only groups stalling investment in our health outcomes and a path forward are the insurance companies and their Congress Members.
The Coalition Against Populist Progressives
The hefty influence of all this money and power is felt in Congress, seen on cable and print news, and even felt on a personal level by activists and political volunteers. No organization is too small or remote to escape attempts to frame the argument away from Medicare for All or outright suppress it altogether.
As groups like National Nurses United and Physicians for a National Healthcare plan have spurred grassroots ‘people power’ efforts to educate the public on Medicare for All, they often encounter pushback from local political operatives. So too have civic groups like Democratic Socialists of American, Green Party members, and the nonpartisan Our Revolution organization, which is currently organizing a “Medical Emergency Tour” across the country.
This tour has targeted members of Congress in their districts in hopes of convincing them to sign on to the House bill as co-sponsors. They have armed a group of constituents, data, and funding models, members of Our Revolution have applied gentle pressure in Congressional districts like Illinois 10th District, a seat held by Blue Dog Democrat, Representative Brad Schneider, himself a member of the House Ways and Means Committee. Rep Schneider is a strategic pick as his committee has the power to stop Medicare for All from ever reaching the House floor for a full debate. Rep. Schneider has also come under fire as his wife works for a health brokerage firm with significant industry-related investments.
“I appreciate that my Congressman is right on other issues, but I don’t need him to consign thousands of people to death and tens of thousands more to bankruptcy at the same time..."
Adam Broad, a longtime Democratic activist, party volunteer, and elected Vernon Township Trustee, was among the group hoping to sway Rep. Scheider to support the bill. Broad has met with Rep. Schneider many times on the issue of expanded Medicare and had enjoyed a cordial relationship until recently.
Broad said he expected Rep. Schneider to discuss the matter in good faith. That hope fell apart after discussing the financial data, census figures, the Congressional Budget Office report, and the Republican Koch-backed Mercatus Study only to have the Congressman repeat the same objection, “How are we going to pay for it?”
Broad still did not understand the influence of insurance companies working overtime in his district. “I live in a divided area politically and I recognize that I am a little further left than some in my own party,” Broad said. “I can respect a conservative stance, but when he repeatedly looks me in the eye and gives me a bunch of bull... That’s going to rub me the wrong way.”
(Excerpt of the letter sent by Congressman Schneider's office in response to a consitiuent asking him to support Medicare for All, June 2019)
Broad felt even more determined to educate the public on the plan and keep trying to move his own representative to the left, even as he says he felt increasingly marginalized by his own party.
“Reportedly ‘some people’ are ‘alienated by me’ because the Congressman received a visit from the Our Revolution’s “Medicare For All National Emergency” ambulance and got dinged in a few of my blogs. Maybe I should have prefaced all of that with, ‘I tried talking to him and he was less than sincere’,” Broad said.
“I appreciate that my Congressman is right on other issues, but I don’t need him to consign thousands of people to death and tens of thousands more to bankruptcy at the same time. My township party chair is dismissing this activism as some kind of ‘Bernie cult’ nonsense, apparently unaware that this is Jayapal’s bill we are pushing, not Bernie’s,” Broad observed.
Pressure for Broad to curtail his push for Medicare for All came to a head this week when he found himself removed as administrator from his local party’s social media platform. When he asked Traci Fine, the Vernon Township Democratic Chair, about the change, he says she told him that, “some people had complained”.
When Broad pressed further for an explanation, he says Chair Fine admitted in an email that Schneider’s fundraising ability and support was more important to their local efforts.
In an email from the Vernon Township Democratic Party Chair, Traci Fine, explained the move by saying, “Although we have a very liberal policy of allowing comments, once in a while a comment or post will be denied when it goes strongly against our mission. The mission of the Vernon Township Democratic Party is simple: to elect Democrats. We trust that group members will understand and abide by this position.”
Broad says that the exchange was devastating after two decades as a party volunteer, “I don’t recall ever giving up my freedom of speech and I never posted anything untoward on the township party page. Others were free to post favorable articles about their preferred candidates and policy.”
He continued, “This has been very painful for me because I have such deep respect for my colleagues and have truly been honored to serve with them. This really puts things into perspective as we’re hearing about the Koch brothers pledging to support Democrats just to fend off populist Progressives. All this makes Progressive issues even more important. People can not wait.”
Broad’s story is being echoed by activists across the country who also feel pressure from allies during what has become a heated primary. Still, millions of volunteers are now mobilized to push Medicare for All through petitions and educating neighbors, one by one, if necessary. Hopeful organizers know this is exactly the kind of effort it will take, and more, if average working people hope to be heard above the massive outpouring of campaign funds from insurance companies.
The numbers themselves are daunting. In the 2016 elections cycle, Insurance companies spent nearly $90 million dollars, setting a new record, to bolster campaign funds and sway messaging. That was the first election cycle since Franklin D. Roosevelt with a prominent presidential candidate openly advocating for expanding Medicare coverage to all Americans. In this presidential election, the numbers may prove to be even higher, both in direct campaign funding and media influence.