Sign Up for Updates

The Blog

Healthcare CEOs doing just fine without healthcare law repeal

National Nurses Movement, 1/5/11

If the Obama health care bill is just a "government takeover," why are healthcare industry CEOs being rewarded with so much money?

The alleged expropriation of healthcare by big government is, of course, a major story line of the right and the new leadership of the House which is planning the useless exercise of a vote to repeal the law. But if the private companies who actually do control our health are hurting so badly, why are they shelling out so much to their top executives?
  
A report from Kaiser Health News out today exposes lavish pay packages for some of the biggest players in the private healthcare industry.
Here’s what a few top executives banked the past two years according to KHN:

  • Billy Tauzin, PhRMA -- $9,098,585
  • Scott Serota, Blue Cross/Blue Shield -- $7,214,668
  • Charles Kahn III, Federation of American Hospitals -- $4,513,714
  • Karen Ignani, America’s Health Insurance Plans -- $3,791,261
  • Richard Umbdenstock, American Hospital Association – 3,818,426
  • Stephen Ubl, Advanced Medical Technology -- $2,389,423
  • James Greenwood, Biotechnology Organization -- $2,418,690

As KHN notes, most of these execs supported either the entire law or key aspects of the law.

PhRMA, the drug company trade lobby, and Tauzin famously cut a deal with the White House to lock down backing for the bill by the pharmaceutical industry, the 800-pound gorilla in healthcare profits. In exchange, the White House blocked progressive proposals to support drug reimportation as a way around the outrageous price gouging of the drug industry.  

Tauzin, so artfully chronicled by Michael Moore in "SiCKO," is a former Congressman who was  rewarded with the top job in PhRMA after leading passage of the Bush administration’s Medicare drug deal which created windfall profits for the drug giants. He has since decided to take the money and run, leaving his post last June.

The insurance companies played it both ways.  The insurers supported the bill long enough to assure the administration and top Democrats would scuttle first single payer reform, then even the public option, while including the individual mandate requiring all those without coverage to buy private insurance. The result – tens of millions of new customers, and hundreds of millions in added profits, hardly an indication they were being "taken over" by the government.

Of course the ever greedy insurers sought to hedge their bets by also running ads attacking other parts of the law and backing many of its opponents, apparently ignoring the irony that some of those they were supporting would be promoting the legal challenge to the insurers' beloved individual mandate.  

Private hospitals, expecting lots of additional revenue, were also key advocates of the law. CEOs of some of the biggest hospital chains in the country, including for-profit s like Tenet Healthcare, and non-profits like Kaiser Permanente, have been among its biggest champions.

Also on board were those profiting from medical technology programs, as almost all the reform advocates push information technology as the supposed solution to medical errors and cost savings, despite the enormous cost of such technology and its frequent misapplication too often used to displace the expertise and judgment of professional caregivers which can lead to worse patient care.  

Finally, there’s the biotech industry which, as KHN notes, also favored the law, winning in exchange a highly dubious 12-year exclusivity for brand name biologic drugs and a tax credit to boot.

Do we really need to replay the same debate over the current law over and over? Will that solve any of the still very real problems that exist? Notably the tens of millions of Americans who remain uninsured, many of whom will not be covered even if the law goes into full effect. And the millions more who are slammed daily by un-payable medical bills and ever rising costs that the bill does so little to address.

Reminders of the continuing healthcare crisis come regularly. To name just three:

  • The U.S. ranks just 22nd in health well-being among major industrialized countries, according to a UNICEF report issued in December.
  • Growing numbers of parents with premature babies, or children born with special needs, according to another KNH report, are being socked with huge bills for neonatal care because the health professionals are deemed to be "out of network."
  • Only 58 percent of private sector employees have access to paid sick leave, according to a report out this week from the Institute for Women’s Policy Research.  

Among the consequences of the sick leave report, many sick employees come to work because they can’t afford the unpaid lost time, especially in a deep recession, or they avoid taking sick time for fear of employer retribution. They thus risk aggravating their illness and facing more serious sickness, more lost time, and higher health costs, and they increase the likelihood of infecting others in their workplace.

It’s time to move on. Let’s end the fiction that the current law was a government takeover. Let’s stop replaying the fruitless debate of the past two years over the false issues the right loves to exploit.

And let’s find ways to address the continuing health problems plaguing so many by working instead:

To  really reign in skyrocketing costs, that are primarily driven by the very same profiteering private companies whose executives are being paid so much, and

Guarantee healthcare for all Americans, best done by expanding the most cost effective, real universal program Medicare to cover everyone.

Back to The Blog »