The Wonk Room

Why Do So Many Grassley Amendments Benefit The Health Care Industry?

Most of the Republican amendments to Sen. Max Baucus’s (D-MT) mark seek to obstruct legitimate debate, but Sen. Chuck Grassley’s (R-IA) amendments suggest that the ranking member of the Senate Finance Committee won’t support reform legislation that undermines interests of the health care industry.

Grassley, who has spent his entire summer attacking reform legislation, has offered at least 10 amendments that would directly benefit the health industry, of which he is the top recipient of campaign contributions. According to an analysis of records compiled by the Center for Responsive Politics, Grassley received the most health industry contributions this year – $223,600. Sen. Max Baucus (D-MT) was second with $141,000.

While “there is not a quid pro quo,” Sheila Krumholz, executive director of the Center for Responsive Politics explains, “there is an expectation that a contribution gives you a chance to be heard by the member.” Approximately one-third of Grassley’s amendments benefit the industry.

Three separate amendments aim to protect government’s subsidy of private insurers participating in Medicare Advantage. As a senator from a rural state, Grassley is sensitive about ensuring that his constituents have access to health care services, but his devotion to the 13% subsidy undermines the stability of the broader Medicare program, from which 88% of Iowa Medicare enrollees benefit. Traditional Medicare is actually less expensive to administer and is no less effective than private plans in Medicare Advantage. In fact, according to a Government Accountability Office private plans in Medicare Advantage channel the extra payments into profit, not improved benefits.

Four Two of Grassley’s amendments replace the individual mandate to purchase coverage with a reinsurance policy that would allow insurers to pay into a “reinsurance fund” that would finance very high medical expenses. Without an individual mandate, reinsurance could protect the entire insurance pool from picking up the costs of individuals who purchase coverage after a crippling diagnosis. While ‘reinsurance’ does contradict AHIP’s public embrace of the individual mandate, the scheme would benefit private reinsurance firms (some of which are AHIP members).

Grassley also offers four separate amendments to eliminate fees on health insurance providers, medical device manufactures, clinical laboratories, and manufactures and importers of branded drugs. The industry strongly opposes this fees and is lobbying Congress to eliminate them.

Grassley Develops New Opposition To Individual Mandate, Proposes Re-Insurance Scheme

Sen. Max Baucus’s health care mark appeases top-line Republican concerns. Under the mark, undocumented immigrants are ineligible for coverage, federal funds cannot be used for abortion and the public option is no more (the list goes on here). But many Republicans are still raising the same stale objections; some are even inventing new reasons to oppose the legislation.

Yesterday, Sen. Chuck Grassley (R-IA) reiterated his concern about undocumented workers being eligible for coverage and public dollars being spent on abortions. Grassley has also developed a new-found opposition to the individual mandate — a policy that even health insurers support:

HEMMER: Now as I understand it, you want stronger language preventing federal funds from going to abortion. You want stronger language to make sure illegal immigrants are not covered. If you got those two big points, would you go for it?

GRASSLEY: No, there are other points as well, but let me mention other points that you didn’t mention. And one would be the individual mandate, which for the first time would have a federal penalty against people who don’t have health insurance. I could do that through re-insurance and risk pools, to make sure we get more people insured in a voluntary way and I’m very reluctant to go along with an individual mandate.

Watch it:

But just last month, when asked “how does this bipartisan group that you`re a member of get to more health insurance coverage if you don`t mandate that employers provide coverage,” Grassley replied “through an individual mandate and that`s individual responsibility and even Republicans believe in individual responsibility.”

During a June appearance on Fox News Sunday, Grassley said, “there isn’t anything wrong with it [an individual mandate], except some people look at it as an infringement upon individual freedom”:

But when it comes to states requiring it for automobile insurance, the principle then ought to lie the same way for health insurance. Because everybody has some health insurance costs, and if you aren’t insured, there’s no free lunch. Somebody else is paying for it….I believe that there is a bipartisan consensus to have individual mandates.

During yesterday’s interview however, Grassley found fault in the “automobile insurance” analogy, explaining to host Bill Hemmer that “owning a car and driving a car are voluntary, you don’t have to do it…in this particular case every American would have to have insurance or you would have a penalty,” he said.

Hypocrisy aside, Grassley’s ‘reinsurance scheme,’ along with his abortion and immigration objections, are simply wrong headed. Grassley would replace the individual mandate with reinsurance. To make-up for the cost of individuals who would only buy coverage once they become sick (and remember, under insurance reform, insurers would have to accept all applicants, regardless of pre-existing conditions), Grassley would allow insurers to pay into a “reinsurance fund” that would finance very high medical expenses. This way, he would protect the entire insurance pool from picking up the costs of individuals who purchase coverage after a crippling diagnosis.

This makes sense in the short term, but on the whole it’s bad policy. We spend about 75% of our health care dollars managing chronic diseases and comparatively little on preventing individuals from developing those diseases in the first place. Grassley’s initiative, in other words, would not do anything to catch folks on the front end of the illness, (like the mandate would) and fail to lower costs over the long term.

The abortion piece is no less peculiar. The Baucus mark preserves current policy by preventing federal money from funding so-called ‘elective abortions’ — abortions in cases of incest, life, or rape would still be covered. The mark forbids women from using subsidy dollars for abortion services and forces them to finance the procedure with private money. But Grassley is suggesting, like Tony Perkins does here, that a woman who wants to buy a benefits package that includes abortion services, should not receive any federal assistance– even if she’s using those dollars for unrelated services. In other words, women who purchase comprehensive packages — that include abortion services — must pay for the entire cost of the package (even if they qualify for subsidies).

Grassley Defends ‘Pull The Plug On Grandma’ Comments: Palin Said It First! »

Last month, Sen. Chuck Grassley (R-IA) was widely criticized for saying that Americans “have every right to fear” the end-of-life counseling provisions in the House health care bill. “We should not have a government program that determines if you’re going to pull the plug on grandma,” Grassley said during a town hall in Iowa.

This morning on C-SPAN, Grassley defended his statement by arguing that “there is another political leader, higher up in the hierarchy that used that than I did” and suggested that if Americans “connect several dots,” it would become obvious that the bill could euthanize seniors:

Well, there is another political leader, higher up in the hierarchy that used that than I did…And then the Washington Post, or some newspaper later on said something about Sarah Palin. Well, Sarah Palin said that presumably before I said it…But if you figure, if you connect several dots, you got, the concern about saving money in this health care bill, you’ve got the concern about a public option leading to a government run health care plan, and then you got the Veterans Administration putting out a book saying that all of the doctors have to deal with end of life issues for everyone that is in that system, and then you’ve got all of that put together. And quite frankly, between government running everything and paying a doctor to give that advise, everybody figures that the government is going to be in the middle of end of life issues just like they are in England, as an example.

Watch it:

In reality, the so-called ‘death panel provision,’ Section 1233 of the House Tri Committee bill, would allow Medicare to reimburse providers for consulting with patients about end-of-life issues; nothing in the section mandates a consultation. In fact, the provision builds on President Bush’s efforts to expand Medicare coverage to “counseling the beneficiary with respect to end-of-life issues and care options” for terminally ill patients. In 2003, Grassley voted in favor of the provision as part of Bush’s Medicare drug bill.

The Wonk Room has compiled a list of Grassley’s most egregious misrepresentations and will continue monitoring and fact checking Grassley’s statements throughout the reform process. Read the full document HERE.

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GrassleyWatch: Democratic Health Bills Are ‘Failures’ ‘Rejected At The Grassroots’

In response to critics who argue that Sen. Chuck Grassley (R-IA) is not negotiating the health care bill in good faith, a Grassley spokesperson issued this statement:

Jill Kozeny, a spokeswoman for Sen. Charles Grassley of Iowa, said the accusations were unjustified. She said Grassley and five other Senate Finance Committee members – half Republicans, half Democrats – will hold their scheduled conference call Friday…Kozeny said Wednesday: “Attacks by political operatives in the White House undermine bipartisan efforts and drive senators away from the table….” She also called Democratic-crafted bills “policy failures and they’ve been rejected at the grassroots.”

Greassley’s summer tour to discredit the Democrats’ health care bill certainly speaks louder than his spokesperson’s commitment to bipartisanship, which Grassley promises to pursue during Friday’s phone call. But will he be looking for genuine compromise or obstruction? In other words, is there a difference between Grassley the politician and Grassley the policy maker?

All signs point to no. During a recent interview with Kaiser Health News, for instance, Grassley indicated that he has not had “any conversations” with Sen. Max Baucus (D-MT) about his recent suggestions that the public option would pull the plug on grandma, refusal to to vote for an “imperfect bill” or statement that “the only way to get a bipartisan agreement is to defeat a Democratic proposal on the first hand.” Grassley said there was “nothing” “that needed to be clarified or straightened out” in his relationship with Baucus.

In fact, the above statement re-affirms Grassley’s commitment to obstructionism. Democratic-crafted bills are “policy failures and they’ve been rejected at the grassroots,” Grassley’s spokesperson says, on the eve of Grassley’s “bipartisan negotiations” about said policies. A more honest broker would have admitted that voters haven’t rejected Democratic-crafted bill; they’ve rejected Republican rumors about the Democratic bills.

Health Care Reform Is Not About Pleasing Conservatives

Democratic leaders say their post-August strategy is to “convince members that nothing is set in stone and that they are more than open to negotiations. And they’re engaging in a softer sell, prioritizing health insurance reforms while pitching the public option as something that’s way, way down the road.” A “softer sell” to whom, exactly? Conservative Democrats can (hopefully) be whipped into a vote, but if Democrats try to please Republicans, then they’ll fail the American people. After all, pleasing Republicans would require one to abandon health care reform entirely.

Consider Matt Corley’s latest addition to GrassleyWatch — a now daily project chronicling Sen. Chuck Grassley’s (R-IA) absolute refusal to negotiate with Democrats on the all-important Senate Finance Committee bill. Throughout the month of August, Grassley has managed to re-commit himself to obstructionism on a daily basis and today, during a conference call with Iowa radio reporters, Grassley suggested that the only way to reach a bipartisan compromise would be to first defeat the current Democratic health care proposals:

Republican Senator Chuck Grassley says there may be only one path Democrats can take to get Republicans to support for health care reform. “There’s a feeling that the only way to get a bipartisan agreement is to defeat a Democratic proposal on the first hand and then the Democrats will come to Republican leadership and then, at that point, they’ll know the only way they’re going to get health care reform is bipartisan,” Grassley says.

The Senate’s No. 2 Republican, Sen. Jon Kyl (R-AZ), has also argued that “the public response lawmakers were seeing over the summer break should persuade Democrats to scrap their approach and start over.” “There is no way that Republicans are going to support a trillion-dollar-plus bill,” he said. Similarly, just yesterday, rather than promising to help negotiate a bipartisan solution, Rep. Mike Pence (R-IN), Chairman of the House Republican Conference, proudly proclaimed that Democrats “ought to scrap the bill that has been moving through the House of Representatives.”

So what to do with the public option, the employer mandate, or subsidy levels? Well, it’s simple. If Democrats believe that a public option is good public policy, or that employers should continue providing coverage, they should include these provisions in the final bill. Republicans have diminished themselves to irrelevancy — it doesn’t matter what they think about the public option because they have admitted that will not vote for a reform bill.

And so, it’s no longer about pleasing the other side. It’s about increasing access, lowering costs, ending predatory insurance practices — and whipping Democratic support for reform. Let’s get to it.

GrassleyWatch: What Does He Not Understand About ‘Fully Paid For’?

Yesterday, Sen. Chuck Grassley (R-IA) — the ranking member on the Senate Finance Committee and a member of the so-called bipartisan ‘Gang of Six’ negotiations — joined the growing chorus of Republican lawmakers who are using the adjusted deficit numbers to argue for a smaller health reform package:

Senator Charles Grassley of Iowa, one of three Senate Republicans negotiating on health care, said the soaring federal budget deficit “puts a stake in the heart” of $1 trillion measures being debated in Congress….“It’s going to have a big impact on whether I’ll even support something,” he said at a town-hall meeting yesterday in Le Mars, Iowa….Still, he said, a forecast by the Congressional Budget Office that deficits between 2010 and 2019 will total $7.1 trillion calls for a more-limited measure than the $900 billion bill the bipartisan group was discussing last month. “We’re going to be looking at smaller numbers,” he said. The deficit projection also dooms $1 trillion measures already moving through the House and approved by the Senate health committee, Grassley said.

Grassley’s suggestion that health care reform would grow the deficit demonstrates that the Senator is either misinformed or deliberately manufacturing reasons to oppose health care reform. The budget framework requires a deficit-neutral health care reform bill, and the Democrats have pledged to fully finance coverage expansion from savings within the system and new sources of revenue.

Secondly, health care is the economy; health care is the deficit. Health care costs are the long-term driving force in federal and state budgets and represent the single most important factor “influencing the Federal Government’s long-term fiscal balance.” The Democrats’ health care reform will help re-orient the system from spending 80% of its dollars treating chronic illnesses into a system prevents the chronic conditions from developing in the first place. It will begin to change the way providers are paid so that we are rewarding quality care and not just quantity care.

In other words, in order to transform America’s expensive patchwork health care system into a system that covers everyone and reduces health care spending by successfully preventing and managing chronic conditions, Congress will have to invest a significant amount into reform. If done right, that investment can place the system and the nation on a firm fiscal footing and save millions of middle class families from catastrophic increases in health care costs. As Tim Fernholz points out, “health-care reform will lead to increases in GDP, reaching over 2 percent in 2020 that would lead to proportional increases in tax revenue and lower deficits. But most important, eliminating the “crazy system of cross-subsidies,” as Center for Budget and Policy Priorities economist Jim Horney calls the complex interweaving of publicly and privately subsidized care for the under- and uninsured, would create a much simpler framework for future cost-reduction efforts.”

The Wonk Room has compiled a list of Grassley’s most egregious misrepresentations and will continue monitoring and fact checking Grassley’s statements throughout the reform process. Read the full document HERE.

Grassley: I Will Not Vote For An ‘Imperfect’ Health Care Bill

The Wall Street Journal reports that, in a recent interview, Sen. Chuck Grassley (R-IA) — the ranking member on the Senate Finance Committee and member of the “Gang of Six” tasked with producing bipartisan health care legislation — “vowed not to vote for an ‘imperfect’” health care bill:

“Now is the time to do this right or not do it.” … “We need to slow down and do a little less,” Mr. Grassley told another town-hall gathering in Pocahontas, Iowa, Monday afternoon. “We need to fix what’s broken and leave alone what’s working well.” In an interview, he vowed not to vote for an “imperfect bill” that includes a public option or gives the government too much control over end-of-life issues.

In March, Grassley characterized himself as an honest negotiator, telling the Kaiser Family Foundation that “everything is on the table. … You don’t negotiate when everything is not on the table…everything’s got to be on the table if you’re negotiating in good faith.” Watch it:

Since then, Grassley has adopted the rhetoric of the far right, routinely referring to health care reform as a government takeover, disingenuously misrepresenting reform legislation, and even going so far as to endorse the “dealth panels” myth.

The Wonk Room has compiled a list of Grassley’s most egregious misrepresentations and will continue monitoring and fact checking Grassley’s statements throughout the reform process. Read the full document HERE.

GrassleyWatch: Tracking Grassley’s Efforts To Obstruct Health Care Reform

In March, Sen. Chuck Grassley (R-IA) raised eyebrows when he urged opponents of health care reform to continue lying about the consequences of comparative effectiveness research and electronic medical records. Since then, the ranking member of the Senate Finance Committee has adopted the rhetoric of the far right, routinely referring to health care reform as a government takeover of health care, disingenuously misrepresenting reform legislation, and even going so far as to endorse and sign a copy of Glenn Beck’s book.

The Wonk Room has compiled a list of Grassley’s most egregious misrepresentations and will continue monitoring and fact checking Grassley’s statements throughout the reform process. Read the full document HERE.

This afternoon, during an appearance on Fox News’ America’s Newsroom, Grassley remained unapologetic for suggesting that the federal government would “pull the plug on grandma.” Instead, Grassley blamed Democrats for his statements, suggesting that they were “diverting attention” from the health bill:

I’m not going to do anything with a health care bill that puts a government bureaucrat, or any government policy making a determination about whether or not we are going to value life and the end of life any more than at age 30 or 20…all of their proposal with end of life are connected in the bill with ways of saving money and takeover of national health care…the Lewin think tank in Washington says that 120 million people are going to crowd out into that plan.

Watch it:

But Grassley’s rant is entirely false. In trying to defend himself from accusations that he was misrepresenting the end-of-life provisions, Grassley doubled down on his false claim that “government policy” would determine the value of life. He echoed Betsy McCaughey’s assertion that “end of life are connected in the bill with ways of saving money” and completely misrepresented the findings of the Lewin report. (Lewin did not study the House bill, as Grassley implied.)

Given Grassley’s long history of obstructing health care reform, “President Obama and Sen. Max Baucus (D-MT) should stop courting Grassley’s vote.” As Steve Benen has pointed out, “negotiating with Grassley in good faith is a mistake. Grassley isn’t serious about reform…It’s time to stop trying. Grassley will only let down reform advocates in the end.”

Including sound Republican ideas is far different from succumbing to disingenuous attacks designed to defeat honest negotiations. If Democrats resort to the latter and work to satisfy stone-throwing Republican lawmakers from small states, they will abandon their principles and wholly disappoint the overwhelming majority of Americans. After all, the country would have “never gotten Medicare 40 years ago if everyone had waited for the conservative Republicans to join on board.”

Read some of Grassley’s greatest hits HERE.

What Kind Of Public Option Compromise Would Grassley Support?

After encouraging AIG executives to commit suicide, but before endorsing the conservative smear campaign against comparative effectiveness research, Sen. Chuck Grassley (R-IA) indicated that he might compromise with advocates of a new public health plan:

GRASSLEY: At this point, everything is on the table. And you don’t negotiate when everything is not on the table even if there’s something that is on the table, that if it’s on the table at the end you don’t have a deal. So everything’s got to be on the table if you’re negotiating in good faith. But then let me speak to the substance of it because I think this is the most important aspect…you have a government plan and eventually it crowds out it says 118 million people. When you crowd out 118 million people, you want to have a private health insurance choice for people because we promised it to them. It becomes so expensive for the small pool thats left that eventually you end up with a single payer.

Watch it:

Several weeks ago, when Sen. Mitch McConnell (R-KY) wrote a letter to President Obama effectively taking the public option off the table, Grassley signed on. If he’s willing to compromise on the President’s proposal, then a competing public health plan would have to play by the same rules as private insurers.

So how would this competition actually work? Well, rather than allowing the new public plan to pay Medicare rates or use Medicare’s clout to bargain for lower costs, a politically viable proposal to promote competition between private health plans and a public health insurance option, will probably look something like what the New America Foundation has proposed.

As Elizabeth Carpenter explained it to me, “what makes the public plan ‘public’ in Len and John’s paper is that it would be operated by politically appointed managers and owned by the government who would also bear the insurance risk, not the private sector. The managers would be evaluated by patient satisfaction, not profits, and the people running the plan would have no incentive to stint on patient care in favor of the bottom line.”

In other words, public and private payers compete on a completely level playing field and follow all of the rules of the marketplace.The public plan would be actuarially sound, would not leverage Medicare to force providers to participate or use Medicare payment rates, and would have to adhere to the same rules regarding reserve funds. Patients who are weary of private providers would likely enroll in the public option.

Costs would be lowered through competition and system-wide reform. “The framework utilizes Medicare as a catalyst to inject value into our health system, but the overall approach to controlling costs is systematic and does not leverage Medicare’s buying power,” Carpenter writes.

The idea is this: if you reform the way Medicare and the public option reimburses for services (move away from fee-for-service and towards bundled payment, primary care, and care coordination) and if those programs become more efficient, the private insurers — who are now competing directly with the new public plan — would also have to adopt more efficient payment practices.

Grassley: Lying About Health Care Reform Is ‘The Only Way’ To Get People To Pay Attention

Lester Feder caught up with Sen. Charles Grassley (R-IA) and asked him what he thought of the right-wing’s orchestrated smear campaign against comparative effectiveness research and electronic medical records.

Grassley, a moderate Republican voice who supports both cost-containment measures, encouraged the effort:

I think they ought to hype them right now because people’s attention needs to be brought to it, and that’s the only way you’re going to get their attention. When the dust settles, they won’t have a leg to stand on and we will have and we will have a study and a tool that will be useful for doctors to use but not to dictate medicine.

During the Kaiser Family Foundation event, Grassley also reiterated his opposition for a new public plan, and suggested that insurers should be allowed to sell policies across state lines.

Grassley Hits Back At Orszag On Medicare Advantage

Today, Fox News spoke to Sen. Chuck Grassley’s (R-IA) about his recent spat with OMB Director Peter Orszag over the administration’s proposal to eliminate the government’s subsidy to insurance plans participating in the Medicare Advantage program:

This administration is proposing to cut that [Medicare Advantage]. I’m all for competitive bidding if it doesn’t cut services for rural America.

Watch it:

As Orszag articulated during yesterday’s hearing, “We’re all paying a $1.30 in order to deliver a dollar to a subset 20% of Medicare beneficiaries. I don’t think that’s competition, I think that’s an unwarranted subsidy.”

In its health care budget, the administration would replaces the 14 percent overpayment to Medicare Advantage and with a competitive bidding process. Insurers in each geographical area would bid to provide coverage, the government would average all of the bids, weigh that by the enrollment in the previous year, and pay out that amount.

Grassley is concerned that the elimination of the Medicare Advantage subsidy would encourage private plans to pull-out of rural areas and lead his Iowan constituents to lose their benefits. But Grassley’s objection, raises an important question: why should the federal government continue over-paying private insurers, if that same level of care could be provided at a cheaper rate?

The competitive bidding process is meant to weed out bloated or ineffective providers and hold down health care spending. Some of Grassley’s constituents might have to switch plans but only if their plan chooses not to bid or cannot provide services at the the market-driven rate. Even then, Iowan beneficiaries wouldn’t lose their Medicare benefits (they will continue to receive Medicare, albeit with some disruption as they move back to fee-for-service or find another MA plan), just the extra benefits that some Medicare Advantage plans provide.

Ultimately, Obama’s proposal does not eliminate Medicare Advantage. Rather, it opens up the process to the very same kind of market forces that conservatives claim reduces costs while providing the very best in care quality.