Healthcare reform: Obama cut private deals with likely foes

Others, such as health insurers, say they weren’t invited at all and face new federal mandates – in all versions of pending legislation – that insurers claim will require them to raise premiums.

These deals are now center stage as Congress heads toward votes that could overhaul one-sixth of the American economy. Some agreements are already unraveling as House and Senate leaders grapple with changes needed to find majorities to pass a bill. The risk is that the corporate interests who so far have backed reform could turn against it. The White House is pushing Democrats to keep the substance of those agreements intact, even at the risk of alienating elements of the party base.

“Some people who are hawks for going after these groups may not have liked [deals made with the White House], but the Obama administration rather astutely recognized that they could have a greater chance of moving ahead if they weren’t being advertised against by a great number of groups that take care of people – and that was worth the price to them,” says Henry Aaron, senior fellow at the Brookings Institution, a Washington think tank.

At the same time, watchdog groups are pushing for more public disclosure about the substance of these deals.

“We should be able to know who they met with and who they have been talking with. If there are deals, if there are understandings, that ought to be public, too,” says Bill Allison, a senior fellow at the nonpartisan Sunlight Foundation, which promotes transparency in government.

Here are elements of these White House-corporate agreements that are stirring controversy on Capitol Hill.

Drug companies

The $80 billion that the Pharmaceutical Research and Manufacturers of America (PhRMA) pledged to contribute to cut prescription-drug costs for seniors survived an early vote in the Senate Finance Committee. But that agreement has taken a battering on Capitol Hill ever since.

Congressional critics say the White House did not strike a tough enough bargain with drugmakers given the tens of millions of new customers they could gain when health coverage becomes mandatory. Congress, they say, is not bound by any agreement that caps at $80 billion PhRMA’s obligation to support reform.

“Compared with what PhRMA is likely to gain in return for this agreement, they really haven’t given up virtually anything at all,” says Henry Simmons, president of the pro-health-reform National Coalition on Health Care, an alliance of some 70 business, labor, health, and faith-based groups favoring healthcare reform.

“I can’t be bound by someone else’s agreement. President Obama never sat down with us. We’re not party [to] anything like that,” says Sen. Tom Harkin (D) of Iowa, who chairs the Health, Education, Labor and Pensions Committee (HELP), the other Senate panel that drafted a reform bill. “PhRMA is just giving pennies when they ought to be coming forward with a heck of a lot more than that. "

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