Cast as a profit-hoarding villain by Democratic foes, the insurance industry still has a fighting chance to fend off the part of health care overhaul it most despises — creation of a government-run plan to compete with private insurers.
Industry lobbyists are using influential allies, a thick wallet and a strategy of avoiding blatant confrontation to block or weaken the proposal, which Democrats say would drive down costs by offering an alternative to private companies. Insurers and Republicans say a federal program, a cornerstone of President Barack Obama’s proposal, would drive many firms out of business.
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With Congress’ work on health legislation at a crawl, Democrats looking to spark popular support have rechristened their drive for “health insurance reform” and hurled epithets at an industry that polls show isn’t trusted. House Speaker Nancy Pelosi, D-Calif., labeled them “villains” while Obama cited “abuses” and “record profits” — even though top health insurers saw their annual profits fall in 2008.
“The American people understand that the status quo would work very well for insurance companies. It doesn’t always work well for them,” White House adviser David Axelrod said Thursday in its latest salvo.
Earlier in the week, Senate Finance Committee Chairman Max Baucus, D-Mont., said polling showed “it becomes quite popular” when Democrats explain the overhaul will curb insurance companies.
“We’re staying on our strategy of being clear that we’re supportive of reform” while opposing a government plan, said Alissa Fox, senior vice president for policy of the Blue Cross and Blue Shield Association. “We don’t want this to be about us, or them.”
Industry opposition is one reason why, as lawmakers’ August recess begins, Democrats still don’t know if they will be able to push a robust public insurance plan through Congress later this year. Though three congressional committees have approved optional government coverage, the House Energy and Commerce panel has voted to limit its version and Senate Finance leaders are considering nonprofit co-ops instead.
At the helm of the industry’s fight has been Karen Ignagni, a former AFL-CIO official and Democratic Senate aide who heads AHIP. Ignagni, who has visited the White House at least four times this year, told reporters opponents’ efforts to “demonize” her industry were “a major step backward,” and suggested that Democrats actually wanted to replace private insurers with government coverage — which Obama and others have denied.
