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Insurers Adopt Tobacco Strategy, Make Case for the Public Option

Health insurers are running their opposition to health care reform just like the tobacco lobby did 15 years ago. Working with established right-wing think tanks with varying interests, they are trying to mobilize businesses, religious leaders, tax reformers, and the media to carry their message that health care reform is bad for our country. Here’s how it was done, then and now. Only now, we can tell them “Not this time.”

Price Waterhouse Coopers released a report on the “Potential Impact of Health Care Reform on the Cost of Private Health Insurance Coverage” today. Simply put, it threatens that any reform could have a “significant impact” on the cost of private health insurance coverage. It goes on to outline some really scary numbers about how premiums could increase by 111% by the year 2019, and takes aim in particular at the Baucus plan’s call for “weak” individual mandates. This report proves one thing: The insurance lobby is using a 15-year old tobacco playbook. As Ezra Klein points out:

The report was farmed out to the consultancy PricewaterhouseCoopers, which has something of a history with this sort of thing: In the early-’90s, the tobacco industry commissioned PWC to estimate the economic devastation that would result from a tax on tobacco. The report was later analyzed (PDF) by the Arthur Andersen Economic Consulting group, which concluded that “the cumulative effect of PW’s methods … is to produce patently unreliable results.” It’s perhaps no surprise that the patently unreliable results were all in the tobacco industry’s favor. He who pays the piper names the tune, and all that.

Would it surprise you to discover that the insurance industry strategy is in that memo, right down to bringing in the same players?

Probably not, but this memo1 (PDF) (h/t Media Matters for America) still made my jaw drop, not so much from the carbon-copy strategy in play, but from the list of players and corrupt crossover of non-profit and corporations. Philip Morris, chagrinned at the idea of funding health care reform with excise taxes on tobacco products, formed a four-prong strategy to defeat it.

15 years later, the issue really doesn’t matter. It could be tobacco, climate change, gay rights, health insurance reform, Wall Street reform, or anything else. The goal is the same: Convince voters to act against their own interests. This is exactly what is happening now. Here’s how:

  • Prong 1: Mobilize the religious right – Philip Morris understood the value of using cultural wedge issues to stoke the fire of fundamental Christians. Using the Acton Institute for the Study of Religion and Liberty to publish “scholarly” articles opposing “sin taxes”, they were able to move a message through  religious communities that health care reform was a threat to basic principles. Today, we have Catholic bishops rising in opposition to the current bills, using abortion, conscience, immigrants, and affordability as their wedges, church insurance providers ‘fear reform’, and the Family Research Council faithfully trumpets their opposition in lockstep.
  • Prong 2: Mobilize the business community – With the aid of think tanks like Cato Institute, US Chamber of Commerce, American Enterprise Institute and many others, the author of the memo was able to work his message into their ‘scholarly’ reports around regulatory burdens on business, erosion of freedom, allegations of economic disaster, and the decline of the US health care system in general. Getting the business community to fall in line behind the opposition was critical, because health care reform then, as now, would have benefited business. It was essential, therefore, that the argument be compelling enough on an ideological plane to convince business owners to act against their own interests and stand in opposition.It wasn’t always easy. One of the business groups PM sought to get on board was The Business Roundtable. The author of the memo notes:

    Nevertheless, BRT has had a history of softness on tax issues, and we need to be extra vigilant in monitoring their activities and positioning on this debate. In particular, we need to be careful of White House efforts to divid the business community in exchange for some promised benefits, and especially of attempts by other BRT members to sell out the tobacco industry to save their own skins.

    Remarkable arrogance, that.

    In 2009, The Business Roundtable supports health care reform as currently proposed with one exception: they do not support any public option in competition with private insurers.

  • Prong 3: Stoke up the anti-tax/anti-government groups. Here’s where you’ll see the most obvious similarities. PM recruited Americans for Tax Reform, a “staunch ally of PM for a number of years in many tax battles” to stir up as much opposition as possible by using their expertise in the “town hall and direct mail formats” as a co-ordinated effort with Citizens for a Sound Economy (now FreedomWorks). PM funded a $400,000 initiative in districts represented by members of the House Energy & Commerce committee to stir and stoke the grassroots, via “town hall meetings, radio and print ads, direct mail, patch-through calls to the Capitol switchboard, editorial board visits, polling data…”. The message?

    The goal of this effort is to show the Clinton plan as a government-run health care system replete with higher taxes and government spending, massive job losses, less choice, rationing of care and extensive bureaucracies. CSE is taking aim at the heart of the plan – employer mandates, new entitlements, price controls, mandatory health alliances, heavy load of new taxes and global budgets — and, with the program well underway, is by all accounts getting rave reviews in the respective districts

    This summer’s FreedomWorks bus tour  and March on Washington‘ were not accidents, nor did they rise from a wellspring of citizen discontent. They were funded, orchestrated, and stirred by the insurance lobby. Until this year’s tax filings are complete, there is no way for me to show you documents proving that. Nevertheless, the message is exactly the same now as it was then. Dick Armey’s call for action against “socialized medicine” is no different than CSE’s opposition to a ‘government-run health care system’. (Where have we heard those words lately?)

  • Prong 4: Control the mainstream media message. PM went to the Manhattan Institute and straight to Betsy McCaughey. The author of the PM memo “worked off-the-record with Manhattan and writer Betsy McCaughey as part of the input to the three-part expose in The New Republic…” Of course, hindsight being 20/20, her report was thoroughly debunked after the Clinton plan was defeated without getting out of one committee. In 2009, the insurance lobby reached out to McCaughey as early as February and again in July just as the House committees reported out their version of health care reform (HR 3200). She launched the current round of misinformation on Fred Thompson’s radio show, her message mostly aimed at seniors (death panels, Medicare cuts). Why seniors? Because internal polls showed that seniors were the most likely group to oppose health care reform, and most responsive to negative messages surrounding it. Newt Gingrich has been instrumental in carrying the message to seniors and faith groups. Fortunately, Betsy McCaughey cannot erase history or PM’s arrogance, and history proves her lie and master, and now you know who the architect of the opposition is, and what their motives are for opposing health care reform.

One final thought: Without exception, the groups listed in the tobacco strategy memo are, were, and have been funded by the same people: Scaife, Koch, Adelson, DeVos, Broekhuisen (Elsa Prince). These are a very small group of people who control billions of dollars. They have built a strong, taxpayer funded (via their non-profit status) stable of think tanks and ‘educational organizations’ to blanket voters with ideas that will compel them to act against their own interests. Besides money, what motives would drive them to throw millions at an effort to allow more people to die, go bankrupt, or lose everything?

Ponder that, then ask yourself who has the power to push back? There’s only one group acting on behalf of the people: progressives who are actively pushing for a public option to be included in the final version of the bill. Why? Because the health insurance industry has shown us clearly they are not interested in our interests. The only way to tell them they have to be is to have an option that excludes them entirely, which is why the public option has become such an important component to health care reform.

1 The probable author of the memo is Roy E. Marden, former policy analyst at Philip Morris Companies, now a director of the Heartland Institute, a think tank funded by Philip Morris Company.

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