The Deal with the Hospital Industry to Kill the Public Option

[peace frog]

Tom Daschle’s admission that the public option was tossed in a deal with the hospital industry may come as news to a lot of people, if it gets wide attention. It’s significant that Daschle tried to clarify his statement to Igor Volsky at The Wonk Room, even though his book contains the same information:

In his book, Daschle reveals that after the Senate Finance Committee and the White House convinced hospitals to accept $155 billion in payment reductions over ten years on July 8, the hospitals and Democrats operated under two “working assumptions.” “One was that the Senate would aim for health coverage of at least 94 percent of Americans,” Daschle writes. “The other was that it would contain no public health plan,” which would have reimbursed hospitals at a lower rate than private insurers.

In addition, this acknowledgement lines up perfectly with the admittedly scant public record we have on the subject. Miles Mogulescu pursued this story at the Huffington Post for months, and Ed Schultz got an on-the-record confirmation from a reporter at the New York Times.

On Monday, Ed Shultz interviewed New York Times Washington reporter David Kirkpatrick on his MSNBC TV show, and Kirkpatrick confirmed the existence of the deal. Shultz quoted Chip Kahn, chief lobbyist for the for-profit hospital industry on Kahn’s confidence that the White House would honor the no public option deal, and Kirkpatrick responded:

“That’s a lobbyist for the hospital industry and he’s talking about the hospital industry’s specific deal with the White House and the Senate Finance Committee and, yeah, I think the hospital industry’s got a deal here. There really were only two deals, meaning quid pro quo handshake deals on both sides, one with the hospitals and the other with the drug industry. And I think what you’re interested in is that in the background of these deals was the presumption, shared on behalf of the lobbyists on the one side and the White House on the other, that the public option was not going to be in the final product.”

The timing of Kirkpatrick’s story about the health care negotiations covers exactly the same time frame as Daschle does – the summer of 2009, specifically July. This article is from August 13 of that year:

Early last month, for example, hospital officials were poised to appear at the White House to announce a deal limiting their industry’s share of the costs of the overhaul proposal when a wave of jitters swept through the group. Senator Max Baucus, the Finance Committee chairman and a party to the deal, had abruptly pulled out of the event. Was he backing away from his end of the deal?

Not to worry, Jim Messina, the deputy White House chief of staff, told the hospital lobbyists, according to White House officials and lobbyists briefed on the call. The White House was standing behind the deal, Mr. Messina told them, capping the industry’s costs at a maximum of $155 billion over 10 years in exchange for its political support.

I don’t know that there’s a piece of paper laying out the terms, or an audio tape of the meeting, or anything other than a handshake deal. But this is a fairly badly kept secret in Washington, and now Daschle went ahead and put it in a mass market book.

The hospital industry was an unsung player in the health care debate, but it was almost certainly their pressure, and their unwillingness to accept a public option which could have bargained down their profits, that led to its demise. In the next round of health reform, and there has to be a next round, the influence of the hospital industry must be taken into account.

http://news.firedoglake.com/2010/10/05/the-deal-with-the-hospital-industry-to-kill-the-public-option/

[HereSince1628]

1. And that new WH COS worked for which Senator Daschle?

hmm.

[DCKit]

2. "...to accept $155 billion in payment reductions over ten years..."

If anyone else here believes they'll do it, I have some derivatives to sell.

We got screwned.

[Myrina]

4. But ... "a bad bill is better than no bill"! And "we can fix it later"

:eyes: :puke: :spank:

You bet we got screwn.

[Recursion]

6. I believe it

It's feasible, unlike the 20% cut directly to doctors we've been kicking down the road for the past two decades.

At least DU is starting to get over the meme that insurance companies are exclusively the problem, rather than delivery costs.

[leveymg]

3. And, then there was Obama's similar deal with Big Pharma. . . the PO was DOA, strangled in the crib.

The HRC we got -- no PO, no prescription drug re-importation -- was the package that Big Industry wanted, and the Administration agreed to months before the Bill came to a vote.

[flyarm]

5. You mean this Tom Daschle???????

.....remember Dashle who was one of the leaders of Team Obama during our primaries..and was one of his top advisors...........working with Whitman..the lady who lied about the air quality at Ground zero in NY?? Can I tickle your memory..she lied and people died and keep dying!! And that is just one example..so now we know the Lady of Ground Zero's death squad the EPA..has so much in common with Tom Daschle the former Democratic party's senate leader and top advisor to Obama..and the New Head of the CIA under Obama..are in bed together..strange bedfellows... what the hey............

Spill, Baby, Spill
By Michael Isikoff, Ian Yarett and Matthew Philips | NEWSWEEK
From the magazine issue dated May 10, 2010

BP has been trying hard to burnish its public image in recent years after being hit with a pair of environmental disasters, including a fatal refinery explosion in Texas and a pipeline leak in Alaska. One major step was to announce, in 2007, that it had hired a high-powered advisory board that included former EPA director Christine Todd Whitman, former Senate majority leader Tom Daschle, and Leon Panetta, who were each paid $120,000 a year. (Panetta left when he became President Obama's CIA director.) Two years ago the oil giant's chief executive, Robert Malone, flew board members out to the Gulf of Mexico on a helicopter to demonstrate the safeguards surrounding BP's advanced drilling technology. "We got a sense they were really committed to ensuring they got it right," Whitman told NEWSWEEK.

Now BP, formerly known as British Petroleum, finds itself blamed for what could prove to be the worst oil spill in U.S. history. And only weeks after Obama announced an ambitious plan to open up more U.S. offshore waters to oil drilling, shunting aside environmental concerns from his own Democratic Party, his administration is facing a comeuppance from hell. "There was a lot of wishful thinking, I guess," says Villy Kourafalou, a scientist at the University of Miami's Rosensteil School of Marine and Atmospheric Science. "The new technologies were said to be so wonderful that we'd never have an oil spill again." Rep. Frank Pallone (D-N.J.), who had sought to block the expanded drilling, says the oil and gas industry was pushing this idea hard. "They said, 'We'll never have a repeat of Santa Barbara,'?" referring to the 1969 rig explosion off the California coast. Both the Bush and Obama administrations "were buying the line that the technology was fine," Pallone adds.

BP pressed hard to make that point in D.C. Its PR efforts included payments of $16 million last year to a battery of Washington lobbyists, among them the firm of Tony Podesta, the brother of former Obama transition chief John Podesta. Last fall, after the U.S. Interior Department proposed tighter federal regulation of oil companies' environmental programs, David Rainey, BP's vice president for Gulf of Mexico exploration, told Congress that the proposal was unnecessary. "I think we need to remember," he said, that offshore drilling "has been going on for the last 50 years, and it has been going on in a way that is both safe and protective of the environment."

Read the full article at:

http://www.newsweek.com/id/237298

[Scuba]

7. How can one say it's the "hospital industry" when...

...big insurance companies are driving the agenda.

I worked 32 years in hospital administration and I'll guarantee you hospitals would jump on single - payer rather than keep the mess that's been handed them today.

The healthcare industry is not rocket science. It's much more complicated than that. Just think about all the body systems, medications, illnesses and injuries. Complex enough? Not to Americans. We have a convoluted mess in terms of hospital business too.

In most cases, hospitals don't bill their patients following the rendering of services. They bill Medicare, Medicaid or a for-profit insurance company.

Without prompt payment, the hospital can't pay the nurses and aids, janitors and mechanics. The hospital shuts down.

Fortunately, in most cases Medicare and Medicaid pay reasonably promptly and accurately.

For-profit insurers are slower to pay however, and have an inordinate number of errors on claims. These range from denying the patient is a client to paying a lower percentage of covered charges that their contracts calls for them to do. Funny how the vast majority of errors are in their favor.

To re-bill these claims is notoriously expensive. So hospitals often do one of two things: write it off or tack it on the patients portion. Either way, you're giving insurance companies a windfall profit while sticking it to either the taxpayers or patient.

Ask your local hospital representative what margin they made last year. These are the "retained earnings" that allows them to replace old equipment and start new services, not profits for shareholders.

Any hospital making 3% is a top performer. Many hospitals are losing money, and reducing services as a result.

Hospitals are staffed largely by hard working, well meaning, people most of whom are under compensated for their responsibilities.

It's not the "hospital industry" that's the problem here.

[DCKit]

8. People joke about "rocket science" every day...

but you've never seen a bunch of NASA scientists trying to divvy up a lunch tab.

I have, and made the joke about rocket science (I didn't know). We were all embarrassed.

[philly_bob]

9. Scuba, thanks for comment. I suspect you're right. Hospitals would prefer PO.

Maybe you could promote comment to a Posting of your own.

I've seen the Hospital Association deal story quite often. I would like to see a discussion of how insurance company got the hospital association to be their mouthpiece.

[peace frog]

10. "Hospitals would prefer PO" ?

Hospitals don't care which coffers the payment for their services come from, as long as they are paid.

[Scuba]

11. Philly... thanks for the nice words. Kinda busy right now but will be glad to chime in on health...

...care stuff.

In the meantime, chew on this...

All the "debate" about fire departments and other hot topics (pun intended) is mentally stimulating, but FOCUS, DAMN IT !!!

The ONLY thing that matters at this point is getting progressive voters to the polls on November 2nd.

You can help do that.

Volunteer down at Democratic HQ. They need people to make phone calls, knock on doors, compile lists of local events, do data entry, etc.

Help others get their early ballots in case they can't get out on election day.

Get a yard sign.

Talk to your cousin/nephew/aunt etc.

We need to focus on this or the next two years of DU will be not about how to improve the country, but about limiting damage.

thanks,

Scuba

[katty]

12. HMO's: ready to go death panels