The 1st Congressional District of Hawaii is about as far from Washington, D.C.’s pitched political battles as you can get — not typically seen as a national bellwether. Yet the race for the congressional district, centered in southern Oahu, is one of several competitive elections that has attracted the attention of big-money lobbyists seeking to influence the direction of American health care policy.
Hawaii’s 1st District seat, which was vacated by incumbent Democratic Rep. Colleen Hanabusa, who is running for governor, has attracted six serious candidates to the Democratic primary in this reliably blue district. According to documents obtained by The Intercept, at least three of the candidates took time out from their schedules to talk to a consultant dispatched by the Healthcare Leadership Council, a lobbying group that seeks to advance the goals of the largest players in the private health care industry.
Now, the 1st District candidates working with the Healthcare Leadership Council — former state Sen. Donna Mercado Kim, Hawaii Lt. Gov. Doug Chin, and Honolulu City Council Member Ernest Martin — are taking heat from their opponents for talking to an industry-friendly group, even as public opinion is increasingly rallying to positions opposed by giant health care companies.
“Democrats running in a primary election will say they support ‘Medicare for All,’ but what do they say to lobbyists behind the scenes?” said Kaniela Ing, a state lawmaker vying for the 1st District seat on a democratic socialist platform, warning of Democrats who make progressive promises when campaigning, but then work hand in hand with industries when in office. “We need health care champions, not puppets.”
One of the leading candidates has campaigned on a promise to crack down on over-priced pharmaceuticals and promote single payer health care, but told the consultant dispatched by the Healthcare Leadership Council that he would maintain drug industry-friendly pricing policies and views Medicare for All with skepticism.
The Healthcare Leadership Council has closely tracked what its lobbyists have described as the “leftward movement” within the Democratic Party. In Hawaii and other states, the lobby group wanted to know if ideas popularized by Sen., Bernie Sanders, I-Vt. — such as aggressive proposals to reduce the cost of pharmaceuticals and institute a single-payer health care system modeled on Medicare — were taking hold.
The council, which spends over $5 million a year on industry advocacy and brings together chief executives of major health corporations, represents an array of health industries, including insurers, hospitals, drugmakers, medical device manufacturers, pharmacies, health product distributors, and information technology companies.
The group’s focus on competitive open seats around the country — like Hawaii’s 1st Congressional District — is aimed at shaping the next generation of lawmakers’ views on health care policy.
The Healthcare Leadership Council’s outreach in Hawaii began in January. In an email obtained by The Intercept, the group told candidates that it was in the process of forming a coalition to “jointly develop policies, plans, and programs to achieve their vision of a 21st century system that makes affordable, high-quality care accessible to all Americans” — language that obscured its national campaign to monitor and blunt the energy behind progressive health policy reforms. The email included an invitation for the candidates to take a meeting in Honolulu.
Kim, Chin, and Martin agreed to speak to the Healthcare Leadership Council, which then drew up dossiers on each candidate based on their answers to the survey questions. The dossiers, which were obtained by The Intercept and Documented, profiled each of the candidates, including their photos, biographical sketches, contact information for their campaigns, and a checklist for determining their positions on certain issues of importance to the Healthcare Leadership Council. (Kim and Martin’s campaigns did not respond to a request for comment for this story.)
In an email to The Intercept, Michael Freeman, executive vice president of the Healthcare Leadership Council, said that his organization surveys “congressional candidates every election cycle regarding their views on a wide range of healthcare issues.”
The dossiers offer the candidates’ general outlook on health care policy issues, as well as their answers on specific policy positions. Of Kim, the former state senator, the group’s profile says, “She is very pro-market, opposes any attempt at single payer, does not support price controls on pharmaceuticals and agrees that Medicaid and Medicare need to be managed by the private market.”
Chin is a “moderate Democrat that has represented healthcare providers in Med-mal lawsuits,” said the Healthcare Leadership Council’s profile. Chin, the survey noted, “supports the market concept advocated by HLC and does not think a single payer/Medicare-for-All approach would work in Hawaii.”
“Martin supports a majority of HLC’s positions,” the profile on the Honolulu City Council member says. “He does not want single payer.” But, the dossier noted, Martin needed better education on health policy.
In some cases, what the candidates told the lobbyist appeared to differ from what they told voters.
Chin indicated to the Healthcare Leadership Council that he supports its position that the “best way to achieve the lowest prices for Medicare beneficiaries in the Medicare Part D program is through the current process of private sector negotiation,” according to his dossier.
As it stands now, the Medicare law, authored under the influence of the drug lobby, prevents the agency from using its collective bargaining power to negotiate lower prices for pharmaceuticals as part a benefit program known as Part D. Progressive health care activists have agitated for the government to become directly involved in negotiations. Public Citizen, a watchdog group, claims that allowing Medicare to negotiate for lower-priced drugs could save $15 billion per year from the program’s budget.
Drug industry groups like the Healthcare Leadership Council — which is funded by pharma giants Amgen, Johnson & Johnson, Merck, Pfizer, Novartis, Novo Nordisk, and Bristol-Myers Squibb — have opposed the negotiation route.
Chin’s claim, according to the Healthcare Leadership Council documents, that he supports the industry-friendly status quo contrasts sharply with what he has said in public. In July, he told local news website Civil Beat that he supports “steps like empowering the federal government to negotiate lower prescription drug prices for Medicare beneficiaries.” (Civil Beat and The Intercept’s publisher, First Look Media, were founded by Pierre Omidyar.)
In response to a request for comment from The Intercept, Chin stuck with his public position that Medicare Part D should include negotiations with drugmakers over prices. “Doug Chin speaks with seniors across Hawai’i who are making heartbreaking sacrifices to buy the life-saving prescriptions and get the quality health care they need. That’s why he supports the merits of a single-payer system, and it’s why he will demand that Medicare use its existing authorities — and support giving it new powers – to negotiate better deals for seniors,” said Chin’s campaign manager, Dylan Beesley. “Doug was endorsed by End Citizens United because he is committed to getting the secret cash from big drug companies out of politics — for good.”
The campaign’s statement did not address a question from The Intercept about why the council lists Chin as supporting its position that Medicare should not negotiate directly with drug companies — or the discrepancy with his public stance.
THE DOSSIERS INDICATED that all three candidates who met with the group were rated as positive leaders who shared much of the Healthcare Leadership Council agenda and were the type of politicians who might turn to the group to help formulate policy.
Yet the Healthcare Leadership Council didn’t blanket all the state’s congressional candidates with requests for meetings. Beth Fukumoto, a Republican-turned-Democratic state legislator who launched her campaign for the 1st Congressional District seat in March, had not heard from the group, according to a campaign spokesperson. Another candidate for the seat, former Rep. Ed Case, a conservative “Blue Dog” Democrat who has served recently as a senior executive at Outrigger Hotels, did not respond to a request for comment from The Intercept about whether he had received any requests from the Healthcare Leadership Council.
The group also kept tabs on candidates that could be a threat to its agenda. In its internal profile for Ing, the democratic socialist candidate, the Healthcare Leadership Council noted that Ing vocally supports a single-payer, public health care system. “One of Kaniela Ing’s top priorities will be to promote a single-payer, Medicare-for-all system,” the dossier says.
Lobbyists for the group have told health industry executives to remain vigilant about the threat of single payer.
“It would be a mistake for us to overlook the growing number of lawmakers who are supportive of measures to expand significantly government’s role in healthcare,” the Healthcare Leadership Council warned in a report published at the end of last year.
The report observed that Sanders, the Vermont senator, had introduced a “Medicare for All” bill during every congressional session, typically by himself. But when he unveiled his latest version of the legislation in 2017, Sanders “had 14 Democratic senators with him, including some thought to be presidential contenders in 2020.” Even more moderate members, including Sen. Tim Kaine, D-Va., and Sen. Michael Bennet, D-Col., had introduced a public option bill that would provide patients with the ability to purchase a government-sponsored insurance plan that would ensure access with Medicare providers, paying Medicare reimbursement rates.
The Healthcare Leadership Council report said that while these ideas do not have the political support to pass at the moment, the “momentum on the Democratic side of the aisle is undeniable.” The group has warned health care executives to remain vigilant and dispatched its team of lobbyists, which includes a bipartisan team of two former members of Congress and several former senior congressional staffers, to keep tabs on rising candidates.
The Healthcare Leadership Council’s outreach to candidates was not limited to Hawaii. Lobbyists working with the group have surveyed congressional candidates for open seats in Indiana, Kansas, California, Minnesota, Illinois, and New Mexico.
For instance, Young Kim, the Republican nominee for California’s 39th Congressional District, an open seat and one of the most competitive races in the country, spoke to the Healthcare Leadership Council earlier this year.
“She has very little understanding of the healthcare delivery system, but wants to learn,” the dossier on Kim noted. “Her philosophy is similar to HLC’s overall agenda. She supports the market as the real innovator in healthcare does not support California’s effort to implement a Medicare for All system.” The lobbyists who drew up the dossier found that Kim agreed with the Healthcare Leadership Council on 88 percent of the policy positions it inquired about.
Other dossiers noted that some Republican candidates were privately skeptical of repealing the Affordable Care Act. Jim Hagedorn, a Republican candidate for Congress in Minnesota, shared internal polling from his campaign with the Healthcare Leadership Council, revealing that health care is the No. 1 issue in his district. Though he expressed support for “free market healthcare,” Hagedorn conceded that he has heard from “many farmers having to choose to not to carry insurance and gamble that they do not need it.”
THE HEALTHCARE LEADERSHIP Council’s candidate outreach program is part of the group’s ongoing push to develop “get-out-the-vote” efforts for favored politicians, develop “early connections to successful congressional candidates,” and aggregate data about up-and-coming lawmakers so that health care executives and lobbyists can quickly facilitate meetings and relationships, according to an internal document explaining its political approach to member companies. The group boasts on its website that it has conducted 3,900 meetings with lawmakers, staff, and candidates around health care issues.
The group also organizes coalition efforts with patient organizations, industry letters to regulators, and regular coffee sessions between legislators, congressional staff, and health industry executives.
The threat of government expansion into health care, however, has added new urgency to the council’s outreach efforts.
The Healthcare Leadership Council also recently produced a set of talking points to warn of the “ramifications of single-payer healthcare.” The document makes the outlandish claim that “Medicare for All” proposals might resemble the failed health care system of Venezuela and prophesies extreme cuts in care and health services.
In reality, the “Medicare for All” program proposed by an increasing number of Democrats would be akin to the system in Canada, under which the government provides health insurance coverage free of cost for patients to seek care with private-sector providers. Leading health policy watchdogs have found that the system in Canada and similar government-run health plans provide higher quality medical services at a much lower cost than the U.S. system.
The alarmist positions relayed in the talking points reprise a familiar role for the group.
Health insurance whistleblower Wendell Potter previously worked closely with the Healthcare Leadership Council. Potter later leaked documents detailing a health insurance industry plan to stigmatize single payer during the 2008 election, hoping that scare tactics would dissuade successful Democrats from championing the idea. The anti-single-payer plan included outreach to moderate Democrats at organizations such as the Progressive Policy Institute — the think tank arm of centrist group Third Way — to position the idea as an extremist threat to the Democratic Party. The plan called for supporting groups that would broadcast supposed “horrors of government-run systems.”
The Healthcare Leadership Council also served as a coordinating organization for health industry lobbyists to launch attacks against President Bill Clinton’s push for a national health care plan in 1993. During the debate over the bill, industry organizations sponsored misleading campaign commercials to mobilize mass opposition to the policy.
At a gathering of health care executives in 1994, at the height of negotiations, then-Council President Michael David Bromberg reportedly rose from his chair and confronted then-first lady Hillary Clinton, threatening that if she did not agree to industry demands, the industry would strike back and campaign against her and her husband’s plan.