Health bill foes solicit funds for economic study

By Michael D. Shear
Washington Post Staff Writer
Monday, November 16, 2009

The U.S. Chamber of Commerce and an assortment of national business groups opposed to President Obama's health-care reform effort are collecting money to finance an economic study that could be used to portray the legislation as a job killer and threat to the nation's economy, according to an e-mail solicitation from a top Chamber official.

The e-mail, written by the Chamber's senior health policy manager and obtained by The Washington Post, proposes spending $50,000 to hire a "respected economist" to study the impact of health-care legislation, which is expected to come to the Senate floor this week, would have on jobs and the economy.

Step two, according to the e-mail, appears to assume the outcome of the economic review: "The economist will then circulate a sign-on letter to hundreds of other economists saying that the bill will kill jobs and hurt the economy. We will then be able to use this open letter to produce advertisements, and as a powerful lobbying and grass-roots document."

James P. Gelfand, the e-mail's author, confirmed its authenticity in a brief telephone conversation Sunday evening. He said the campaign against Democratic health legislation would only be launched "if that's what it found," but declined further comment and referred questions to a Chamber spokesman.

The behind-the-scenes effort by the business groups to influence the legislative debate is part of an intensifying series of attacks by the opponents of Democratic health-care plans. President Obama has said he wants a final bill on his desk by the end of the year, leaving opponents little time to raise new objections as the legislation marches forward.

The Chamber and the White House have been at odds for months, with the group opposing Democratic efforts on both health legislation and climate change, two of Obama's priorities. Chamber officials have also charged the administration with pressuring some member companies to quit the group.

Senate Majority Leader Harry M. Reid (D-Nev.) is expected to unveil by Tuesday a bill assembled from the several measures passed in Senate committees during the past several months. A House measure passed by a slim margin.

Sen. Mitch McConnell (Ky.), the Republican leader, on Sunday called for a delay in the Senate's consideration of the legislation. Appearing on "Fox News Sunday," McConnell said that he and his 99 colleagues should have time for thorough review of the legislation.

"The only way to guarantee that for sure is to delay the process, allow everyone to fully understand what's in the bill," McConnell said.

Speaking from Singapore on CNN's "State of the Union," White House senior adviser David Axelrod said the president wants the legislation finished by the end of the year and will "push very hard" to meet that goal.

"There has been a long, vigorous, thorough debate and it's time to get it done," Axelrod said.

The proposed economic study by the Chamber is the latest example of attempts by advocates and opponents of health-care reform to influence the debate with economic studies whose authenticity is later questioned by their adversaries.

In mid-October, just as the Senate Finance Committee was drafting the final wording of its health bill, the insurance industry released a study suggesting that the bill would dramatically increase the cost of insurance in the country.

The White House and reform advocates pushed back hard, arguing that the study by America's Health Insurance Plans (AHIP) was a self-serving document that did not consider all of the relevant information in the legislation.

PricewaterhouseCoopers, the firm retained by AHIP, later said it had not considered some parts of the health-reform proposals that might affect the cost of insurance on households.

Chris Jennings, who served as senior health-care adviser to President Bill Clinton, said the Chamber e-mail, written last Wednesday, is reminiscent of the AHIP study, both in terms of use of questionable data and of timing.

"It smells very political," Jennings said of the economic study proposed in the Chamber e-mail. "Obviously, the memo suggests both the analysis and its use is preordained. I would think there would be people in the business community who would think better of doing this to the more business-friendly Senate."

A number of economists have expressed concern that the legislation does not pay enough attention to controlling costs of employer-sponsored health insurance. Some analysts argue that taxes on the bill -- like the $40 billion levy on medical device manufacturers -- could cost thousands of jobs. And small-business leaders have said the bill's mandate for them to carry insurance could force them to shed employees.

In the e-mail, Gelfand writes that the proposal was "suggested by our Congressional allies" but does not specify who those allies are. He notes that the effort has collected $30,000 of the hoped-for $50,000 from other groups, including the National Association of Manufacturers, the Small Business and Entrepreneurship Council, the International Franchise Association, and the Independent Electrical Contractors association, each of which had contributed $5,000, according to Gelfand's e-mail.

Reached at home, Jay Timmons, a senior executive at the manufacturers association, confirmed his group's payment but declined to comment further.

Gelfand says in the e-mail that the economist would be asked to study the Senate Finance Committee version of health reform, and would be asked "to rejigger the study" once the Senate releases a merged bill.

"We are seeking 4-5 other groups to contribute $5k so that we can move forward as soon as possible, especially considering that Leader Reid has filed a rule 14 to begin debate as early as Tuesday," Gelfand writes. "The longer we wait, the less chance we have of influencing the debate."

He concludes the e-mail by saying: "If you know of any other trade associations we should approach, please let me know."

White House deputy communications director Dan Pfeiffer said the e-mail is "proof positive that the opponents of health reform will not let the facts get in the way of their efforts to defend to the status quo that has been so profitable for the insurance companies."

Randy Johnson, the Chamber's senior vice president who handles health-care issues, called the e-mail "inartfully worded" and said the group never intended to suggest that the outcome of the study would be preordained.

"It's not saying that we would tell the economist how it should come out. Perhaps it wasn't artfully phrased," Johnson said. "It's based on what we think the economist will come out with. It doesn't mean we know what the economist will come out with."

Johnson said the Chamber always intended to be transparent about who funded the study. Asked whether the Chamber would release the study if it concluded that the health bill would increase jobs and improve the economy, he initially said, "We would cross that bridge if we came to it."

Moments later, he said, that on reflection, a positive finding from the economist would help to educate the business groups and would play a role in the position they take on the legislation.

"If it was like, oh wow, well, it doesn't have the kind of adverse impact we thought, that would educate us," he said.

© 2009 The Washington Post Company