Obama and Big Medical: Too Close?

Health care reform is starting to look like a big bailout for the insurance industry to a range of commentators

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A bombshell memo obtained by The Huffington Post's Ryan Grim bolstered a hidden point that commentators have made in the past week about health care reform: it will almost surely be a multi-billion dollar boon to corporations. The document between the White House and a pharmaceutical lobby agreed that the government would not squeeze pharmaceutical companies if they save customers just $8 billion per year in costs. (If the memo's true, this means Obama has gone back on a Medicaid promise, Time's Michael Shearer notes.)

BusinessWeek's cover story bodly declared the insurance companies have already won, no matter the final legislative outcome of reform. Chad Terhune and Keith Epstein describe what companies wanted dead and wanted included:

The industry has already accomplished its main goal of at least curbing, and maybe blocking altogether, any new publicly administered insurance program that could grab market share from the corporations that dominate the business. UnitedHealth has distinguished itself by more deftly and aggressively feeding sophisticated pricing and actuarial data to information-starved congressional staff members. With its rivals, the carrier has also achieved a secondary aim of constraining the new benefits that will become available to tens of millions of people who are currently uninsured. That will make the new customers more lucrative to the industry.

"When government is big, the well-connected always have an advantage over the rest of us in influencing public policy," John Stossel writes. Stossel continues by saying while Big Pharma and Big Insurance don't like Medicaid negotiating drug prices or a public-insurance plan (HuffPo and BW say they're dead) these are small potatoes compared to millions of new customers backed up by the government.

Reform stylized as a pharma-insurance bailout comes under attack from the left because it says a public option would attain the goals of health care reform without lining corporate pockets. "An individual mandate to buy overpriced private insurance, with no public plan to compete, would be a gravy train for private insurers," said MyDD's desmoinesdem.

OpenLeft's Daniel DeGroot criticized Republicans as fighting hard to prevent the government from limiting insurance companies' freedoms but roll over to the threat of people's freedoms. "They'll gut everything else about it that might infringe on the Murder-by-Spreadsheet industry, but authoritarian capitalism by government dictate is evidently ok by them."

This article is from the archive of our partner The Wire.