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Health Insurance Industry Looks to Senior Lobbyists

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By Jeffrey H. Birnbaum
Tuesday, September 18, 2007

If the rumor mill is correct, Karen M. Ignagni is about to notch a major victory for her employer, the nation's health insurance industry.

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As chief executive of the awkwardly named America's Health Insurance Plans, Ignagni presides over the association that represents nearly 1,300 companies that sell health insurance. In that capacity, she has been fighting a rear-guard action in Congress this year to defeat a cutback in Medicare.

On Aug. 1, the House voted to take a five-year, $50 billion bite out of Medicare Advantage, a health plan for seniors that Ignagni's members help run. The next day, the Senate passed companion legislation, but it did not take a dime out of Medicare Advantage.

Now, Capitol Hill is abuzz that the House might soon bow to the Senate and largely if not completely spare the program from cuts -- at least for now. If that happens, Ignagni's member companies stand to profit handsomely and millions of seniors will continue to benefit from Medicare Advantage.

Ignagni will assert (and I expect the phone call any minute now) that she was not responsible for any victory. She will say that it was senior citizens who made all the difference. And to a large extent, she is correct.

But she is also complicit. Ignagni's group, with the help of its members, has been building a list of senior citizen activists since 1999. Known as the Coalition for Medicare Choices, the network is managed by association employees who regularly keep in touch with the seniors who sign up and spur them to action when they are needed.

The network is currently 400,000 strong. In recent months, every senator and nearly 100 congressmen were contacted by multiple seniors in the system. Over the August recess alone, the association clocked about 20,000 calls to congressional offices.

Ignagni supplemented this deluge with a national advertising campaign. Its targeted TV commercials were designed to thank some lawmakers for supporting the industry's position and to remind others who are on the fence that seniors would not be happy if Medicare Advantage were trimmed.

The association also bought newspaper ads to praise the overall legislation, which at its heart expands the popular State Children's Health Insurance Program, or SCHIP. The ad pointedly recommended the Senate's version, which pays for the SCHIP expansion with an increase in tobacco taxes, not a cut in Medicare Advantage.

The effect has been impressive. Congressional aides say they have heard the association's point of view even above the din created by two of Washington's most powerful interests: the American Medical Association and AARP.

AARP, which represents nearly 39 million older Americans, and the AMA, the nation's largest physicians group, joined forces in July to push the House version of the bill. AARP prefers the House bill because it enhances certain aspects of Medicare (other than Medicare Advantage), especially for low-income seniors. The AMA is happy with the House rendition because it blocks a scheduled reduction in Medicare payments to doctors.

Both provisions could well come back later this year -- paid for by shaving Medicare Advantage -- because many lawmakers believe that Medicare Advantage is too rich a program. But for now Ignagni's outpouring of outrage appears to have won the day.


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