Report of PhRMA Anti-Health Care Reform Ad Shows Industry Support Only Skin Deep

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The Pharmaceutical Research and Manufacturers of America (PhRMA) was an early White House health care ally, and, despite a recent controversy, has teamed with some unlikely interest groups to spend millions advertising in support of reform. But according to a report in Politico, they also have produced an ad–in the can, ready to go– attacking one of the key Democratic proposals emerging on Capitol Hill.

PhRMA senior Vice President Ken Johnson denies the report unequivocally, saying the notion that there’s any such ad is “absolutely false.”

“We have two plans for health care reform,” he told TPM, “‘a’ and ‘1a’ and they both stress the importance of passing health care reform this year.”

Whether or not such an ad exists, the controversy over it goes to the heart of the highly tactical game the major health care industry stake holders have played as nominal supporters of the White House’s push for reform. Early in 2009, pharmaceutical manufacturers, insurers and other trade groups aligned themselves with the White House figuring reform was unstoppable and that their best play was to influence its scope from the inside–that they needed the White House more than the White House needed them. But that balance is changing. And the groups now show a greater willingness to jump ship if it becomes clear the final deal is not sufficiently in their interests or, more tellingly, if the political climate suggests there’s more to be gained by going into outright opposition.After all, ad or no ad, PhRMA’s support doesn’t run very deep. Though the group’s representatives are more than willing to endorse the idea of reform in the same broad terms the White House uses, it outright opposes the House health care package. In a July 31 statement, Johnson said “the totality of the efforts in the U.S. House of Representatives, while well-intentioned, represents a step in the wrong direction in the health care reform debate.”

PhRMA isn’t the only group that nominally supports the idea of “reform” but remains staunchly opposed particular legislative proposals. AHIP, the health insurance industry’s main professional association, is part of the same White House-based reform coalition as PhRMA. Like the administration, it endorses, “health care reform that makes care more affordable, improves quality, and covers all Americans.” But behind the scenes AHIP is trying to kill the public health insurance option, which it calls “a roadblock to reform.”

The group has been tracking member town halls as part of their campaign to bulldoze that roadblack, and has run ads calling for a “bipartisan” health care reform solution–a subtle dig at House legislation. Currently the only potentially bipartisan health care reform proposal is being drafted by the Senate Finance Committee, and it doesn’t contain a public option. And, more broadly, insurers are still lavishing money on even the most anti-reform Republicans.

In other words, as congressional Democrats approach votes on actual legislative packages, industry is demonstrating more clearly than ever what many observers suspected all along: that stakeholder support for the Obama administration’s efforts is a means to the end of getting a seat at the table–and those stakeholders will quickly rescind it if Democrats appear set to enact a proposal that they regard as contrary to their interests.

PhRMA’s support for health care reform was reportedly premised on an agreement with the White House that drug manufacturers would be responsible, through taxes and benefit cuts–for no more than $80 billion worth of the cost of legislation, and that, in return, the White House would, among other things, oppose any provisions that allowed the government to bargain for lower drug prices or import drugs from Canada.

However, before adjourning for August recess, the House Energy and Commerce Committee advanced a bill that allows both.

ABOUT THE AUTHOR

Brian Beutler is TPM's senior congressional reporter. Since 2009, he's led coverage of health care reform, Wall Street reform, taxes, the GOP budget, the government shutdown fight and the debt limit fight. He can be reached at brian@talkingpointsmemo.com
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