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Health insurers turning to GOP after big win

Sat., Oct. 23, 2010

WASHINGTON – Health insurers flirted with Democrats, supported them with money and got what they wanted: a federal mandate that most Americans carry health care coverage. Now they’re backing Republicans, hoping a GOP Congress will mean friendlier regulations.

They may get more than they’re wishing for.

The so-called individual mandate has provoked tea party conservatives, who see it as an example of big government interference in personal decisions. Now Republican candidates are running on platforms that include repealing the broader health care law. And attorneys general from some 20 states are challenging the mandate as unconstitutional.

“If you ended up repealing that one provision, the whole thing blows up,” said Bill Hoagland, the top lobbyist for Cigna Corp

Still, Cigna, which early last year had been funneling money to Democrats from its political action committee, has shifted from a 50-50 split between the parties to around 70-30 in favor of Republican candidates.

Likewise, about $6 of every $10 that Blue Cross Blue Shield Association’s PAC doled out from February through June 2009 went to Democrats. By last month, the ratio had shifted – Democrats got only about 35 percent of the insurer’s PAC money.

The GOP advantage has grown even as Republican candidates call for outright repeal of the health care law.

“This is really an incredible irony,” said Robert Laszewski, a former insurance executive turned consultant. “The insurance industry could be fighting with its traditional ally, the Republicans, not to cripple the bill, not to put a bomb inside the thing.”

Meanwhile, an Associated Press-GfK poll finds likely voters in the upcoming elections evenly split on whether the law should be scrapped or whether Congress should undertake even bigger changes. Thirty-seven percent said they want to repeal it. But 36 percent of those polled said they want to revise the law so it does more to change the health care system. Ten percent wanted modifications to narrow the scope of the overhaul. Only 15 percent said they would leave it as is.

Though the insurers won the insurance mandate they wanted from President Barack Obama and the Democrats, they opposed the overall bill and now say they want to be sure the regulations they face aren’t onerous. A Republican-controlled Congress might accomplish that by pressuring the Health and Human Services Department through its control of the department’s budget or by subjecting regulators to hearings.

A central worry for insurers is a planned requirement that companies spend a minimum 80 percent of premiums on medical care or rebate the difference to policyholders. They also want a say in defining what would be considered “excessive” premium increases that could expose an insurance company to sanctions.

“What they are looking for is someone who is going to be more sympathetic and supportive on the policy side,” said Peter Harbage, a Democratic health policy consultant.

There’s more to the shift in political support than a recognition that Republicans are within reach of regaining power. It’s also personal.

Some industry officials say they were stung by the fierceness of Democratic efforts to paint them as corporate villains in the debate over the new health care law. Liberals blamed insurers for forcing Obama to back away from a plan for optional publicly financed insurance for people who could not afford traditional coverage.

Then Obama, seeking to rally support for his plan, went on the offensive. Without an overhaul, he wrote in August 2009, “insurance companies will continue to profit by discriminating against sick people.”

From then on, political giving by the insurers flipped.

Democrats made it sound like insurance companies were “the scum of the earth,” Hoagland said.

“We are not the ones totally responsible for all the failings of the health care system,” he said. “It persuaded me that we were not getting a fair shake.”

The attention to regulation is also playing out at the state level, where insurance regulators hold significant sway. Between 2005 and 2008, health insurance companies and health maintenance organizations contributed more than $32 million to state officeholders, political parties and ballot measure committees, according to the National Institute on Money in State Politics. The top four insurers – WellPoint, UnitedHealth Group, Humana and Aetna – gave a quarter of that amount.

So far this year, based on available reports, those four firms have given $2.2 million to state candidates or parties, with Republicans getting more than half, Democrats about 40 percent and the rest going to ballot initiatives, according to an institute analysis for the Associated Press.


 

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