Obamacare Sold Out America

Leading the effort was Senate Finance Committee Chairman Max Baucus (D-Montana), who from 1999 to 2005 accepted more special-interest money than any other senator. He delegated the real lifting to his chief health aide, Liz Fowler. Baucus described Fowler as overseeing "the 87-page document which became the basis, the foundation, and the blueprint from which all health-care measures in all bills on both sides of the aisle came."

"They don't want to do anything to make the situation in the states better. Instead, they're actively undermining the programs."

Fowler, as it would happen, was a former vice president at WellPoint, the country's largest health-insurance carrier. She returned to Baucus' staff just for this occasion. As the Guardian would later write: "Few people embody the corporatist revolving door greasing Washington as purely as Elizabeth Fowler."

Meanwhile, Big Medicine donated heavily to Democrats, who suddenly began to see the industry in a far less menacing light.

Kentucky, the home state of Mitch McConnell, has one of the most successful state co-ops. McConnell, ironically, helped sabotage co-op funding in 26 other states.
Gage Skidmore/Creative Commons
Kentucky, the home state of Mitch McConnell, has one of the most successful state co-ops. McConnell, ironically, helped sabotage co-op funding in 26 other states.
Early in his presidency, Barack Obama helped rally youth in the fight for health-care reform with events like this 2009 event at the University of Maryland.
Daniel Borman/Creative Commons
Early in his presidency, Barack Obama helped rally youth in the fight for health-care reform with events like this 2009 event at the University of Maryland.

Obama also began backpedaling. "We don't want a huge disruption as we go into health-care reform, where suddenly we're trying to completely reinvent one-sixth of the economy," he said. Avoiding a single-payer setup and Wyden's plan not only kept the donations flowing but also allowed the president to make his famous claim that people could "keep the plan that you have."

In exchange for maintaining the status quo, hospital groups pledged $150 billion in Medicare and Medicaid savings over the next decade, while insurers agreed to limit their overhead to 20 percent. Anything more would have to be rebated to customers.

"Clearly, we made a mistake in taking so much off the table before we ever started," says Congressman John Yarmuth (D-Kentucky). "We should have left single-payer on the table just so people had an idea what the extreme really was. I'm sure that was just a bone to insurance companies to get them onboard."

Of all the participants in health reform, the fattest cats came out of it smelling the best — a ­telling indictment of Obama and Baucus.

Drugs are the most profitable sector of health care. Pharmaceutical companies make more than $1 trillion annually, a third of that in the United States. Their profits not only dwarf those of other health sectors but pharmaceutical also ranks seventh highest out of 215 industries tracked by Morningstar, an investment research company.

For years, the drug makers' consigliere was Louisiana congressman Billy Tauzin. A conservative Democrat who rose to the position of assistant majority whip only to switch sides after Republicans won the House in 1994, he compares the situation to reaching a fork in the Yellow Brick Road.

"I had one hand on a party that desperately needed a brain and another on a party that desperately needed a heart, and I had to make a choice," he says today. "I decided to go with the party that needed a heart, because heart-transplant surgery was possible."

In 2003, Tauzin helped shepherd through one of the great corporate giveaways in American medicine: President George W. Bush's Medicare Part D prescription-drug plan.

The rationale for Part D was noble enough. It was designed to ease the squeeze on seniors who saw fixed incomes eaten up by the cost of their prescription drugs, which were rising at a double-digit clip.

But instead of running the government-subsidized program through Medicare, where it could have been administered at a fraction of the price, Republicans handed the job to the insurance industry. They also teamed with Democrats such as Baucus and Sen. John Breaux (D-Louisiana) to ban Medicare from negotiating prices.

That meant that instead of using Medicare's massive size to extract price breaks, taxpayers would have to pay whatever drug makers felt like charging the insurers. According to the Congressional Budget Office, it amounted to a $137 billion giveaway over ten years.

When the bill took effect, drugmakers saw a 34 percent spike in profits. By then, not surprisingly, Tauzin had left Congress to become president of the Pharmaceutical Research and Manufacturers of America (PhRMA), the drug industry's trade organization. Breaux left a year later to open a lobbying firm, where he received a $300,000 contract to lobby for Big Pharma.

On the campaign trail in 2008, Obama blasted Part D's ban on negotiating and promised to get tough.

"We'll tell the pharmaceutical companies: 'Thanks, but no thanks for overpriced drugs,' " Obama said at a Virginia campaign stop in 2008. "We'll let Medicare negotiate for lower prices. We'll stop drug companies from blocking generic drugs that are just as effective and far less expensive. We'll allow the safe reimportation of low-cost drugs from countries like Canada."

After all, there was ample evidence that U.S. consumers were being gouged. For example, in France, which negotiates prices, Eli Lilly charged patients $47 for a one-month supply of Cymbalta, a medicine used to treat depression and anxiety. The cost in America was $176.

Pfizer charged Canadians $53 for Celebrex, an anti-inflammatory painkiller. The bill for Americans: $162.

In one TV ad, Obama blistered Tauzin for the kind of inside corruption that's made Washington famous.

"The chairman of the committee, who pushed the law through, went to work for the pharmaceutical industry, making $2 million a year," Obama announced to the camera, his sleeves rolled up for action. "That's an example of the same old game-playing in Washington. You know, I don't want to learn how to play the game better; I want to put an end to the game-playing."

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