Democrats & Liberals Archives

Republican Rings of Corruption

III - Republican/Medical Industry Ring

America is blessed with a medical system that costs more than the medical systems of other highly industrialized nations. Yet its effectiveness is not as good. Though there are many reasons for our dysfunctional health system, I believe that corruption between our political leaders and the medical industry is responsible for a big portion of our healthcare problems. As with the Republican/Arms Industry Ring, both Democrats and Republicans are to blame. However, during the Bush Administration corruption reached new heights.


Our healthcare system is a big hodge podge of physicians, HMOs, managed care companies, hospitals, drug companies, equipment providers, clinics, testing labs, nursing homes, hospices, insurance companies, government agencies and more.

It cannot truly be called a system. Maybe that is why we spend about $500 billion a year on health services, but do not get anywhere near our money's worth. Among the many problems are that 15.6% of the population is uninsured. It is estimated that we as a nation spend $100 billion a year to provide health services to the uninsured. Even the insured do not get good service. Another problem is that prescription drug costs are reaching the stratosphere: We spend $200 billion a year and the cost is increasing 12% a year.

Lobbyists are responsible for much of this. Each actor in the medical industry has its own lobbyists, who are there to fight for the self-interest of that actor. Precious few actors are concerned with the public interest.

Between 1998 and 2004, drug companies spent $758 million on lobbying - more than any other industry according to government records analyzed by the Center for Public Integrity, a watchdog group. In Washington, the industry has 1,274 lobbyists — more than two for every member of Congress. Sen. Chuck Grassley, R-Iowa, chairman of the Senate Finance Committee, says.

"They are powerful. You can hardly swing a cat by the tail in that town without hitting a pharmaceutical lobbyist."

During the 2000 campaigns, health care companies gave more than $5 million to Bush and other conservatives. Several health executives are "pioneers," those who raised more than $100,000 for the Bush campaign.


Healthcare lobbyists were active during the Clinton administration. Then too, lobbyists were mostly Republican, and they did their damndest to kill Hillary Rodham Clinton's Healthcare proposal. Sure, there was plenty of criticism of her task force, some of it deserved: The discussions were secret and did not include important players in the industry. Also, the proposal was complex.

She ran into opposition from those in her own party who wanted a single payer system such as Canada's. But why did Democratic Senator Pat Moyniham oppose her? Could it be money? According to the New York Times, interest groups that opposed the Clinton’s plan contributed $259,685 to Moynihan from January 1, 1993, to March 31, 1994. This was a great deal more than the $19,500 he got from them during 1982-1992.

Because Hillary wanted to use a tabacco tax to implement the system, Philip Morris launched a big advertising campaign against Clintoncare.

But the American Hospital Association had the killer advertising campaign. They spent 14 to 15 million dollars on "Harry and Louise" ads that showed a typical couple discussing how Clintoncare could lead to rationing, a loss of choice of doctors, and a decrease in quality of care.

The executive director of the Center for Responsive Politics said at the time:

"This is the biggest scale lobbying effort that has ever been mounted on any single piece of legislation, both in terms of dollars spent and people engaged."

Hillary's proposal was not even considered. Nobody offered something better. Clintoncare was strangled at birth.


The Republican mantra is "deregulation, deregulation, deregulation." In the medical industry, the big drug companies paid lots of money and lobbied intensely to get their way. One example will suffice to show both the power of big pharmaceuticals and the resultant tragedies.

In the 1980s, drug companies decided that the drug approval process of the FDA was too slow - it took more than 2 years. So they agitated for speeding up the process up. They won, of course. In the 1990s the average time for approval of a drug was reduced to just over a year.

What was the result? According to the AMA Journal JAMA:

"Drug recalls following approval increased from 1.56% for 1993-1996 to 5.35% for 1997-2001."

Speedup led to the Vioxx disaster. Since its approval in 1999, the pain killer Vioxx has been used by two million people in more than 80 countries. Its manufacturer, the U.S. pharmaceutical giant Merck & Co, earned 2.5 billion dollars in one year alone. But, unfortunately, side effects of the drug include heart attacks, strokes and even death.

It wasn't until Sep. 30, 2004, that Merck withdrew Vioxx from the market. It is available only in special cases.

Deregulation led to serious illnesses and deaths. Similar stories may be told about a host of other drugs and devices.


The healthcare industry reply to Clintoncare is managed care. Before health providers charged fees for services; now HMOs and other managed care providers take care of you for an annual subscription. We don't have "socialism" as Hillary's enemies contended; we have private business in full flower.

We don't have faceless government bureaucrats running the show. No, indeed. We have faceless insurance and HMO bureaucrats running the show. Instead of government employees working for the benefit of patients, we now have insurance and HMO employees working AGAINST the benefit of patients. To save their companies money, they dictate to doctors that they use cheaper drugs, devices and surgery alternatives. All to save a buck. Never mind the needs of the patient.

Hospitals have been privatized in a big way. Gone are the non-profits. Instead we have huge chains. Together with HMOs they allow your doctor to complete a surgery one day and for you to leave the next - whether you are able to or not.

Not to worry. We have health savings accounts. They allow anyone - the guy who makes $1 million a year and the guy who makes $10,000 - equal opportunity to purchse healthcare.


There was one dramatic scene that played out all night, way into the early morning hours, in the House of Representatives on this one day in October of 2003, that demonstrates the many ways the Republicans have mastered the brutal art of corruption. This was the day, or rather night, when Republican arms were twisted to the breaking point to assure passage of the Medicare Drug Bill for paid health industry contributors.

The first step of the Republican leaders in fixing the bill was to distribute the spoils. They wrote into the bill goodies for everybody in the medical industry. They gave $46 billion to HMOs and $25 billion to "rural" hospitals. They boosted Medicare rates about $34 billion. They included $12 billion as "incentives" to insurance companies. They inserted goodies for medical centers, hospitals, ambulance companies, hospice providers, nursing providers and dialysis clinics.

Drug companies won the jackpot: A stipulation that the government would not be allowed to negotiate for lower drug prices.

The joint House-Senate conference committee negotiated behind closed doors. Republicans controlled everything. After some disagreement, the Republicans kicked 5 of the 7 Democrats out and proceeded with a committee of 10 Republicans and 2 Democrats.

The Medicare Drug Bill was sold with false advertising. At the start, the administration told us it would cost $253 billion over 10 years. By the time the bill was introduced, the price tag was $400 billion. Five months before the final vote, Richard Foster, the top expert on Medicare costs in the administration, was warned he would be fired if he revealed the true cost of $551 billion. Two months after Congress approved the bill, the White House admitted the costs would be $534 billion.

So, members in the House, working on the assumption that the costs would be "only" $400 billion, at first voted against it. Upset Republican leaders stopped everything while they worked on fellow Republicans until they got the bill passed by one vote. Here is the rough sequence of events:

  • Debate
  • Floor vote 3:30AM. The vote was 216 for and 218 against
  • Extend debate, during which time:
    - Major contributors warned Rep. Jim DeMint they would cut off funding for his Senate race in South Carolina.
    - Rep. Todd Akin was threatened with a primary challenge against him.
    - Rep. Tom Feeney was told a 'no' vote would delay his ascent into Republican leadership
    - Health and Human Services Secretary Tommy Thompson prowled the House floor to pressure wavering Republicans. This is against the rules
    - Nick Smith was told that Republican leaders will make sure his son would not win a seat in the House; Nick was retiring and his son Brad was planning to run for the seat. Nick was told business interests would give Brad $100,000 if Nick voted for the Medicare drug bill.
  • Debate was extended 3 hours. It has never been extended more than 15 minutes
  • At 6:30AM, the bill passed by one vote
Republican legislators and healthcare businesses work together as a team to produce results both like.


The Republican/Medical Industry Ring is in great shape bringing dividends to both to businessmen and to politicians. This corruption ring serves many, but not the consumer - YOU. I think it's time to propose an integrated health system that serves the needs of every citizen. We must elect Democrats to accomplish this.


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Posted by Paul Siegel at June 8, 2005 6:27 PM