Sending Email With billions of dollars in profits on the line, the health care
industry is waging the largest national
advertising campaign ever conducted
by a political special interest, with a price tag for the election
cycle that could approach $90 million--more than either of the
major presidential candidates is expected to spend.
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Reading Email Already, leading pharmaceutical makers have spent about $34
million on television, radio and print ads since last July, making
them the biggest exploiter of a just-closed loophole that allowed
donors to remain anonymous while funding political ad
campaigns.
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Storing Email But only part of the staggering sums are being paid by drug
makers, who are fighting a plan to expand Medicare by adding
prescription drug coverage. Managed care companies opposed to
proposed regulations such as a right for patients to sue are also
pouring cash into commercials.
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Email Software "You're going to have the biggest ad blitz on health care
America has ever seen," said Mark Merritt, a strategist for the
American Assn. of Health Plans, which is broadcasting some of the
ads. By November, he said, the waves of ads will mean "the most
educated electorate on health care in modern history."
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Antispam Software The commercials make no specific reference to the candidates
seeking the White House. But they attack some White House policies
that are supported by Vice President Al Gore, the presumptive
Democratic nominee, and opposed by Texas Gov. George W. Bush, his
Republican rival.
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Fight Spam One series of ads critical of White House plans to add
prescription drug coverage to Medicare features "Flo," a senior
citizen in a women's bowling group who rejects the intrusion of
"bureaucrats" in her medicine cabinet.
Stoping Spam Another commercial in March seeking to block legislation that
would allow patients to sue their health maintenance organization
for medical malpractice includes scenes of doctors working with a
text that reads: "Washington prefers more lawsuits. But lawsuits
don't save lives. Doctors do. Get patients the care they need
instead of getting lawyers the clients they want."
Block Spam Key Congressional Races Targeted
Spam Emails The commercials are being funded largely by companies that
learned the political ropes when they organized against President
Clinton's highly touted health care overhaul, which was scuttled in
1994.
Email Account Although the ads do not refer specifically to the presidential
campaign, the pharmaceutical industry has focused on key
congressional races, airing commercials in the districts of at
least four House Democrats who backed a bill containing the
Medicare drug coverage plan. The ads accuse them of "playing
politics" with the issue.
Sending Email Gore campaign officials said they are also concerned about
commercials that are critical of the vice president's health care
positions, even if they do not refer to him by name.
Reading Email "They're going to win some votes on this thing," a Gore advisor
said, referring to the prescription drug commercials. "When you put
$50 million on the air, it's going to have its desired effect."
Storing Email Although some independent experts agree the spots will help
Bush, others suggest the industry blitz could backfire by raising
the profile of an issue on which public opinion is on Gore's
side.
Email Software "The more the [ad] campaign focuses on this issue, the more Al
Gore wins support," said Ron Pollack, executive director of
Families USA, a nonpartisan consumer group in Washington.
Antispam Software Gore recently singled out this year's biggest health care
advertiser, Citizens for Better Medicare, a pharmaceutical
industry-funded group responsible for about two-thirds of this
year's health-related advertising. Gore called it a "phony
coalition" sponsored by the drug companies who fear Medicare-backed
prescription drug coverage would erode their profits.
Fight Spam The vice president complained that CBM was hiding its donors
under a controversial provision in the tax code, Section 527, which
was recently closed in the only campaign finance reform bill to
pass Congress this year. The provision let groups raise unlimited
sums without
identifying their donors.
Stoping Spam Most Donors Come From the Industry
Block Spam Dan Zielinski, a spokesman for the organization, noted that it
has listed its membership, which includes many of its donors, "from
day one" online. He also said "almost all" of the donors are from
the pharmaceutical industry. But he declined to reveal CBM's
complete list of donors, how much they contributed or how much cash
the organization has for the campaign.
Spam Emails Zielinski said critics who attack the group's lack of disclosure
are "vilifying the messenger instead of discussing the policy"
questions involved. He also insisted the group is not trying to
influence political races.
Email Account "Our sole concern is to educate the public [and] counter
misinformation," he said. "We are not interested in the political
and electoral races."
Sending Email But Democrats are already suspicious because the company that
places the commercials for Citizens for Better Medicare--National
Media, an Alexandria, Va., firm--also does the same for the
Republican National Committee. Many of the CBM ads are also being
broadcast in the same markets as GOP ads, including those in
Midwest battleground states.
Reading Email When the RNC temporarily suspended its television ads earlier
this month, Democrats say that CBM increased its
advertising buys. The GOP resumed its television campaign this
week.
Storing Email The ads featuring "Flo"--broadcast by CBM--recall the health
insurance industry's famed "Harry and Louise" ads, in which a
fictional middle-class couple sat at the
kitchen table berating Clinton's
1994 health care overhaul proposals.
Email Software At the time, jaws dropped in Washington over that ad campaign's
estimated $14-million price tag, which was picked up by the Health
Insurance Assn. of America. Now, with far more money to flood the
airwaves, major corporations are testing the tactic again.
Antispam Software Democrats and industry experts expect CBM will have spent $65
million by November. An analysis by the Campaign Media Analysis
Group, a Virginia-based firm that tracks political advertising for
The Times, shows CBM has spent about $34 million since last summer.
Researchers at the University of Pennsylvania's Annenberg Public
Policy Center say the airwaves this year also are awash with ads
from at least six other health care groups that had spent or
committed to spending about $25 million on political
commercials.
Fight Spam Health care industry spending could surpass the ad budgets of
either presidential campaign. Bush has spent about $22.3 million on
ads from early 1999 to the end of May of this year, according to
the Campaign Study Group, a Virginia-based organization that tracks
campaign finances for The Times. Gore has spent about $10.8 million
over the same period. Each candidate is expected to spend about $40
million on ads in the general election.
Stoping Spam By commercial advertising standards, the health care groups'
political ad blitz is big, but not overwhelming. The pharmaceutical
group's spending is roughly comparable to the marketing budget of a
summer blockbuster movie such as "Mission Impossible 2."
Block Spam Still, the millions being shelled out are "small compared to the
amount of money that's at stake" in November, said Princeton health
economist Uwe Reinhardt.
Spam Emails For the HMOs, many of which are barely profitable, and the
pharmaceutical firms, whose profits are among the highest in
American industry, bombarding the airwaves is good business, he
said.
Email Account "The rate of return would be stunning if you hold off [stricter
regulation] for another three to four years," said Reinhardt. "It
would be a fine investment . . . and of course the TV industry will
laugh all the way to the bank."
Sending Email Elderly people without prescription drug coverage make up one of
the most profitable segments of the $100-billion-a-year U.S. drug
market because they pay retail prices for their medicine with cash
up front.
Reading Email The presidential candidates' competing plans could have markedly
different effects on that market. The federal government's Medicare
program, which helps pay for health care for 39 million elderly and
disabled Americans, has never covered prescriptions.
Storing Email Gore, like Clinton, is pushing a plan to have the government
cover 50% of Medicare recipients' drug costs up to $5,000 and the
full cost of drugs for people with very high out-of-pocket costs.
Bush would overhaul Medicare and have private insurers offer a
range of coverage, some with drug coverage.
Email Software State Reforms Already Pending
Antispam Software Major drug firms are already concerned because bills to mandate
drug discounts are pending in 18 states.
Fight Spam Nerves are also frazzled among HMO executives, who are seeing
accelerating momentum for expanding patient rights. Both major
party candidates back legislation prohibiting HMOs from making
patients obtain prior permission to visit an emergency room, for
example. HMOs try to limit access to emergency and specialist
services because they cost the companies more.
Stoping Spam Bush signed a patient protection bill as governor of Texas and
said he would expand its provisions to cover people in federally
governed health plans. He also said he would support a limited
right for patients to sue their HMOs in some cases.
Block Spam Gore supports a more expansive plan that would guarantee
consumers many of the same rights, including an independent vetting
of HMO-related complaints. His plan is more expansive, however,
covering people in all health plans.
Spam Emails "We're talking about no less than the final destruction of
managed care," Reinhardt said. And with pharmaceutical companies
wary of government plans that might lead to price controls, "they
fear the government like the plague."
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