Big Money and Health-Care Reform: How the Big Money System Helps Keep the U.S. Health-Care System Among the Most Expensive in the World
Where there’s money to be made, campaign cash often follows. That’s true in the U.S. health-care industry, which includes top spenders for lobbying and high-dollar campaign donors. These big money donations are designed to influence federal legislation and regulation and stymie overhauls. But as the cost of health-care and insurance in the U.S. continues to climb, more Americans are demanding change—and the 28th Amendment will help hold elected officials accountable to the people, not wealthy special interests, for actions that affect the health of our nation.
As the U.S. health-care system grows to engulf more of our economy, those with a vested interest look to maintain the status quo and strengthen their grip on their share of the profits. This power grab not only pushes health-care costs higher, it also leads to an interest-laden, less-efficient system that values spending over solutions.
The United States has the highest health spending based on gross domestic product share among developed countries around the globe, spending 17.8% of its GDP on health care in 2017. Within the next decade, spending is projected to climb further and make up a fifth of the country’s GDP. As more dollars go toward health care, less money goes toward innovations and solutions, and wealth concentrates among the few. As one example, Americans pay the highest prescription drug prices in the world while pharmaceutical companies post astronomical profits—in the third quarter of 2018, 14 drug companies posted profits over $1B.
The U.S. has higher rates of private health spending, as well as higher physician salaries and costs for administration and medicine. Americans do not pay more because they use more health-care services; instead, we pay more because prices are higher.
Look Where the Donors Are
These areas of higher costs align with lobbying amounts and campaign donations for several groups, according to data collected by the Center for Responsive Politics that shows lobbyists for pharmaceutical companies, physicians, insurers and health professionals are the largest source of federal campaign contributions in the health-care sector. Donors in the health-care industry gave $228 million to federal candidates, outside money groups, and parties across the political spectrum during the 2018 election period—well above any other industry. And the spending shows no signs of slowing. By the end of September of this year, drugmakers had spent more than $129 million, according to the Center for Responsive Politics, continuing to outspend any other industry. During that same period lobbying by hospitals and nursing homes topped $75 million, and health professionals lobbyists had spent nearly $70 million.
By pouring money into politics, these donors look to protect their financial interests and discourage policy proposals that threaten the status quo. For example, the Partnership for America’s Health Care Future spent more than $200,000 earlier this year on advertising critical of Medicare for All and other health-reform proposals. The partnership’s members include Blue Cross/Blue Shield, Pharmaceutical Researchers and Manufacturers of America, and the Federation of American Hospitals—groups that prefer enhancing rather than overhauling the Affordable Care Act. (The 2010 health reform law drew its own influx of political spending, according to the Center for Public Integrity, which reported then that businesses and organizations spent more than $1.2 billion on lobbying efforts to influence the law.)
Pharmaceutical company donations to candidates are the focus of the Kaiser Health News campaign contributions tracker, which reveals the lawmakers who bring in the most and companies who give the most. It shows favorite recipients include lawmakers working on pharmaceutical industry legislation or those from districts that are home to drugmaker companies.
Fending Off Reforms and Overhauls
In lobbying for small policy changes rather than revamps, health industry groups protect a system that produces record profits for pharmaceutical firms and hospitals, according to an Axios analysis that notes the profits “allow the industry to amass a war chest to fend off piecemeal reforms and larger-scale overhauls like Medicare for All.”
Those bearing the brunt of this system are families and workers who see their insurance premiums continue to rise faster than wage increases. According to the Kaiser Family Foundation’s annual employer survey, premiums for employer-sponsored family health insurance hit $20,576 in 2019, up 5% from last year, with workers on average paying $6,015 toward that cost.
That yearly cost of a family insurance plan is as much as a new basic economy car, says Drew Altman, chief executive officer of the Kaiser Family Foundation, noting that is “just flat-out not affordable” for lower-income workers, and a good chunk of household spending when the average annual income is around $46,800.
Rising health insurance costs also create a form of taxation without representation, according to a Washington Post opinion article, because “the amount of money we spend on health care is an increasingly unaffordable weight on the bottom lines of households and businesses alike.” As the weight of the bloated health-care industry is driven upon people and businesses, industry lobbyists spend its concentrated wealth to overshadow the will of the American people—73% of whom want health-care reform—by funding elections and re-elections, and lobbying for legislative favors.
To lift that weight, we must create a system that works for all Americans rather than special interest groups, corporations, and wealthy donors who buy influence with campaign money. By winning the 28th Amendment and limiting the role of big money, we can rebalance our government and put the rights—and well-being—of citizens first.
A majority of Americans across the political spectrum want to limit big money in politics and reduce the influence of campaign donations. Building on this cross-partisan consensus, American Promise is working at the local and state levels to amplify actions and hold elected officials accountable to ensure they represent the will of the people and provide for a healthy democracy and economy in the United States.