Insurance Industry Calls Shots Gop Lawmakers Gave Lobbyists Free Rein In Helping Roll Back Regulations
The insurance industry bagged a string of victories this legislative session, from tax breaks and regulation rollbacks to the virtual repeal of the 1993 health care reform law.
One reason: a GOP landslide in the 1994 elections that gave the industry access to lawmakers who offered not only sympathetic ears, but a seat at the table when the deal was cut on bills insurance lobbyists sometimes helped draft.
The results: “Let’s see. Taxes, regulation, health care reform repeal. Is there anything else we could have done for them? I don’t think so,” said Sen. Kevin Quigley, D-Lake Stevens.
The industry played such a key role this session that lawmakers quickly realized it would be more efficient if insurance lobbyists joined them during negotiations with Gov. Mike Lowry on an anti-trust bill.
“I told the governor let’s not play the charade of negotiating with the House leadership, who will just take the proposals out to the industry lobbyists and come back with their position,” said Rep. Dennis Dellwo, D-Spokane. “I said, let’s just bring them in here.
“The governor was reluctant to go outside the representative system of government at first, then realized it would be faster,” Dellwo said.
Added Quigley, “The insurance lobbyists deserve a big bonus.”
But then, they probably aren’t hurting for cash. Big insurers shovel heaps of their customers’ premiums into lobbyists’ pockets every legislative session.
Lobbyists, who often serve as treasurers of political action committees, direct money from their industry benefactors into lawmakers’ election campaigns.
Take Basil Badley.
Badley raked in $110,018 from insurance interests in three months this session for lobbying fees and expenses, including gifts and meals for legislators and committee staff.
His employers include the Health Insurance Association of America, in Washington, D.C., creators of the Harry and Louise ads that helped torpedo national health care reform.
Badley also is treasurer for the political action committee run by the American Insurance Association, which spent $18,424 on 1994 state election campaigns.
He’s married to the chairman of the Senate Government Operations Committee, Sen. Mary Margaret Haugen, D-Camano Island.
“The average citizen can’t possibly afford to hire lobbyists like that,” said Insurance Commissioner Deborah Senn. “The Legislature is supposed to provide a countervailing force, but with lobbyists calling the shots, it was a sad situation.”
Lobbyists wrote sections of HB 1046, the bill that repealed most of the 1993 reform act, Quigley said. “What bothers me is that it got to the point of support for the bill depending on lobbyists signing off on the language, and in some cases they also drafted it,” he said.
“That’s way beyond the usual, normal, process of a lobbyist telling you, ‘Hey, I have a problem with this part of the bill, and this is what it is,”’ Quigley said.
Badley made no apologies for drafting language in bills or shaping negotiations. “They think these bills are written by monks in caves?” he asked.
“We try to persuade, and when we are successful people think it’s inappropriate. Well we had a good case, and that’s why it worked.”
Business lobbyists said they were merely the voice of small and large employers across the state who felt the 1993 reform act was an onerous, expensive job-killer.
“We took a law that didn’t work, and made it into one that did,” Badley said. “We ought to be commended for it.”
Then there’s Mel Sorensen, paid more than $15,000 a month this session to lobby for insurance interests including Spokane’s Medical Service Corporation. And Rick Wickman, paid more than $5,000 a month to lobby for Blue Cross of Washington and Alaska.
They joined Rep. Todd Mielke, R-Spokane, chairman of the House Republican Caucus, and three other lawmakers for closed door negotiations with Lowry over an anti-trust bill.
The agreement reached that night was drafted into a bill the following morning, and passed both houses of the Legislature within two days.
Mielke didn’t apologize for working closely with business and insurance industry lobbyists.
“I’m the first one to admit I don’t know the answer to everything, and that I need to listen to people with expertise,” Mielke said. “I also know when to fight and when to roll, and I regard the health care reform bill on the governor’s desk as a success, a bigger success than I even expected.”
Mielke attributed part of the victory to the coordinated efforts of insurance and business interests.
“In 1993, you had 50 lobbyists going in 50 different directions,” Mielke said. “This year they were a united front.”
Business and insurance interests here and in Washington, D.C., also dumped tens of thousands of dollars into lobbying this session to kill the 1993 health-reform bill, state records show.
The Health Insurance Association of America in Washington, D.C., contributed about $23,427 to the $58,316 so-called “grass roots” lobbying effort launched by the Association of Washington Business to repeal the 1993 law.
The campaign included about $19,427 the Washington, D.C., insurance association spent on Kentucky telemarketers who called Washington state employers to warn them against “government-run health care.”
Telemarketers asked the employers if they wanted to be transferred, free of charge, to lawmakers in Olympia to voice support for repeal of the 1993 act.
“We did it this way because we needed to reach our members in a hurry,” said Don Brunell, president of the AWB. “Hey, if it’s effective, you do it.”
Reform proponents were pitifully outgunned by comparison. Consider Washington Citizen Action, a statewide, grass-roots consumer group. Its total arsenal deployed this session: two lobbyists paid $11.50 an hour, state records show.
In the end, voices for reform were drowned out.
“In 1993 there was this groundswell of support to do something about health care reform,” Quigley said. “This year I knew I was in deep doo doo when I went to one of the first meetings on health care.
“There must have been 40 lobbyists there in opposition, I mean every single one with money. And these guys can direct a lot of it. I looked around and saw I didn’t have a single friend on this issue in the room.”
xxxx GETTING THEIR WAY Insurance company victories in the Legislature: Repeal of most of the 1993 health care reform act, including requirements that insurers disclose top executive salaries, increase consumer choice of health care providers, and operate under a premium rate cap. Passage of a bill to permit taxpayer-financed bailouts of insolvent insurance companies. The House and Senate are still negotiating proposals to cut insurance company business and occupation taxes and let them write off agent commissions. Adoption of an amendment to strip state Insurance Commissioner Deborah Senn of her rulemaking authority. Gov. Mike Lowry says he’ll veto the provision.