Insurers Royally Played Obama

Earl Ofari Hutchinson

In the months after President Obama’s inauguration, he and other administration officials held more than two dozen secret meetings with top insurers and the major pharmaceutical groups. He met with registered lobbyist Karen Ignagni, president and CEO of America's Health Insurance Plans, the major private insurer’s industry group, on March 5, 6 and 11, May 11 and June 30.
The meeting with AHIP and the other industry bigwigs was followed by a much public and much ballyhooed pledge by the private insurers and the pharmaceuticals to plough tens of millions of dollars into an ad and PR blitz to back Obama’s health care reform plan. They solemnly and very publicly assured that they’d work closely with Senate Finance Committee Chair Max Baucus and his five other gang of five cohorts on the Committee to not be the hard headed obstructionists they’d been for the past six decades to getting health care reform passed. Obama bought their pledge, back patted them for their spirit of cooperation, and publicly hailed them for promising to break down the final barrier, namely themselves, to providing affordable health care to all Americans.
The insurers hustled, conned and lied to Obama. They cynically played upon his political naiveté about them. Worse, they didn’t even try to mask their play of him. AHIP brazenly fired off to the press a study it commissioned that claimed that Obama’s health care reform plan would hike the cost of insurance for families by thousands. The insurers insisted that private employers would get hit even harder with the increased fees, taxes, and add-on costs in the reform plan. They swore that would cause many employers to reduce or even eliminate coverage for their employees. The insurers doubled down on their play of Obama by threatening to spend a fortune on an ad campaign to kill his plan.


The worst part of the insurers con game is that they had already squeezed a guaranteed profit bonanza out of the White House and the Senate Finance Committee—no public option, government enforced mandates complete with penalties, taxpayer subsidies of the poor and middle class uninsured, forced employer mandated plans, and best of all absolutely no meaningful government hammer over them to make sure that they don’t raise prices or figure out ways to dump those who private insurers label “high risk” or less charitably, “undesirables” at the first chance they get. Those are the millions who suffer chronic and major diseases—cancer, diabetes, asthma and heart disease. The overwhelming majority of them are blacks and Latinos and the poor.
Covering them was supposed to be the reason that Obama and congress battled for reform in the first place. The issue for private insurers even as they made nice with the White House and deceived Obama into thinking that he had a deal with them has never changed. It’s still their endemic fear of any smattering of government control of medical care.
The hint that insurers would double cross the White House the first chance they got was Obama’s mere mention that he’d impose higher taxes on the wealthy to pay for coverage of the uninsured. This stirred terror among insurers and medical industry groups of deficit soaring taxes and socialized medicine. The even bigger hint was the even more terrifying to them thought that congress might actually impose cost containment measures into whatever reform package that finally emerged from congress. This would directly threaten what insurers regard as their absolute right to make and keep the kings ransom in profits they’ve raked in seemingly forever. This drove them to the barricades the past six decades even faster than their phony, self-serving scare shout that health care reform is socialized medicine.
Obama learned an age old and bitter lesson from the insurer’s double cross. When you try to buy your enemies affection you can never be rich enough. The insurers royally played Obama.

Earl Ofari Hutchinson is an author and political analyst. His forthcoming book, How Obama Governed: The Year of Crisis and Challenge (Middle Passage Press) will be released in January, 2010.