Industry campaign targets Biden health plan during DNCAugust 20, 2020
Bernie Sanders threw Joe Biden a lifeline on health care this week. K Street is now trying to cut it away.
A deep-pocketed health care coalition has launched an assault on the public option during the Democratic National Convention, previewing the intense level of industry opposition Biden's health plan will face if he's elected president.
A new six-figure ad campaign from the Partnership for America’s Health Care Future — a group consisting of hospital, insurance and pharma lobbying heavyweights — decries the public option as an expensive quagmire that would undermine private health insurance. The campaign is a reminder that the public option, though more moderate than Sanders’ sweeping “Medicare for All” proposal, still represents a radical change that the health industry detests.
“The public option would become the third most expensive government program, behind only Medicare and Social Security,” a narrator warns in one of two ads the Partnership is running this week. The campaign includes digital ads and spots on television and the streaming service Hulu.
The ad campaign comes as Sanders and his progressive allies put aside the intraparty rift over Medicare for All to present a united front for Biden’s more incremental health care vision. In a convention speech Monday night, Sanders nodded to his disagreement with Biden on the issue but praised the former vice president's plan to "greatly expand health care," which also includes lowering Medicare's eligibility age from 65 to 60.
But there’s so far been little discussion of the public option during this week’s Democratic convention, aside from a brief mention by Biden himself. Democrats have focused their health care messaging on President Donald Trump’s mismanagement of the coronavirus response and their defense against Trump’s ongoing attacks on the Affordable Care Act.
Biden’s proposal to create a government-run health insurance alternative has grown more robust in recent months, providing an olive branch to progressives. But it also now presents a greater threat to industry profits should Democrats be swept into power this November and rally around the public option.
The Partnership formed in 2018 to fight Medicare for All and other government health care expansions, including the public option. The group supports ACA, which has largely boosted industry profits, and workplace health insurance covering over half of Americans. During the 2018 midterms, when health care fueled Democratic victories, the group ran ads touting the ACA and employer coverage.
Lauren Crawford Shaver, who worked in Barack Obama’s health department and then Hillary Clinton’s 2016 campaign, serves as spokesperson for the Partnership, which is run through the K Street consultancy Forbes Tate Partners. She argues that Obamacare’s individual insurance market and expanded Medicaid already serve as a fallback for people losing employer-sponsored insurance. But Obamacare coverage remains expensive for middle-income customers who don't qualify for insurance subsidies, and a dozen predominately GOP-led states have refused to expand Medicaid to low-income adults.
Crawford Shaver acknowledged those programs “are not perfect and there are certainly improvements to make to our current law, but creating an entirely different government run plan doesn’t help.”
Biden campaign spokesperson Rosemary Boeglin characterized the K Street campaign as a sign the industry is worried he can get his health plan enacted.
"They know Joe Biden was instrumental in delivering the ACA, and they are afraid because they know he can once again deliver a plan that will further reduce health care costs while expanding coverage, end practices like surprise billing, lower premiums, and stand up to the abuse of power by prescription drug corporations," she said in a statement.
Biden and the Democratic platform proposes a government-run health plan that will compete with private insurers in the Obamacare marketplaces. While there's still room to hammer out the policy's details, Democrats said a public option would control the nation’s ballooning health care costs by negotiating doctor and hospital rates as Medicare does.
That’s exactly the notion that rattles the health care industry.
Growing employer interest in a public option also recently sparked a separate six-figure campaign from a different powerhouse group, one typically aligned with Republicans: the U.S. Chamber of Commerce, whose members include major hospital associations that also belong to the Partnership as well as 3 million companies nationwide. The campaign, which was launched last week, seeks to tamp down on employers’ simmering angst over rising health costs.
“We understand that other [employer] groups are open [to the public option], and that’s precisely the reason for this campaign,” said Katie Mahoney, the Chamber’s vice president for health policy.
The Chamber’s campaign uses similar talking points as the Partnership about how expanded public insurance would cut hospital revenue. It also argues that a cheaper Medicare-like option would likely draw younger, healthier employees out of the workplace insurance market, saddling companies with the costs of covering older and sicker people who prefer their private plans.
The health coalition and the Chamber said their campaigns weren't coordinated. Mahoney said the Chamber developed its messaging internally, based on talking points that resonate with its members.
The Chamber isn’t running ads yet, although it may in the future. For now, the organization is funding direct outreach to the business community about “damaging effects” of the public option.
However, the public option has already caught the attention of major employer groups decrying the costs of the status quo as unsustainable. Other ideas they've latched onto that the health care industry hates include the Trump administration's recent price transparency regulations, which for the first time require hospitals to disclose secret prices they negotiate with insurers. Major hospital groups are fighting the rules in court.
Some employer groups are already considering whether a public option could work for them if there's a Democratic sweep in November.
Shawn Gremminger of the Pacific Business Group on Health, which represents large employers including Walmart, said the widespread discussions on a public option show that employer insurance is getting too expensive for companies and workers facing rising out-of-pocket costs. New openness to a government-run option signals that Americans “are looking for a rational way to have a health system that serves the people and not just the health care industrial complex.”
That said, employer support depends on how the policy debate shapes up — and whether they’ll see their own costs going up or down as a result.
“Among our employers we’re starting to see an evolution in their thinking in how we provide coverage,” Gremminger said. “We think there’s an important role for [employer-sponsored insurance], but we also recognize we need to re-examine its role in terms of publicly financed coverage, like a public option. We don’t think the current system is the end-all-be-all and the only way to go.”