An earlier version of this article incorrectly reported that the Claude R. Lambe Charitable Foundation gave $5.7 million to FreedomWorks, which opposes President Obama's health-care reform efforts. The money went to a foundation of Citizens for a Sound Economy; the main group was a precursor to FreedomWorks.
How interest groups behind health-care legislation are financed is often unclear
Thursday, January 7, 2010
Many of the Washington interest groups that are seeking to shape final health-care legislation in the coming weeks operate with opaque financing, often receiving hidden support from insurers, drugmakers or unions.
The groups, some newly formed and others reappearing with different sponsors, have spent months staging noisy protests, organizing letter-writing campaigns and contributing to a record $200 million advertising blitz on health-care reform.
Now, interest groups are making a last-minute push as Democrats begin working out the differences between the House and Senate health-care bills. House Speaker Nancy Pelosi (D-Calif.) said after a White House meeting Wednesday that negotiators are "very close" to an agreement.
The compressed time frame gives outside groups one more chance to attempt to derail the legislation or influence it to their advantage. But in many cases, it is hard to tell where their money is coming from.
The Institute for Liberty, for example, was a one-man conservative interest group with a Virginia post office box and less than $25,000 in revenue in 2008. Now, the organization has a Web site, a downtown Washington office and a $1 million advocacy campaign opposing President Obama's health-care plans.
Andrew Langer, the group's president, said the organization receives no funding from health-care firms but declined to provide details. "This year has been really serendipitous for us," he said. "But we don't talk about specific donors."
The biggest spenders in the health-care debate are well-known Washington veterans with clear constituencies, including the U.S. Chamber of Commerce, which is representing corporate titans who are against reform, and a well-organized network of labor organizations pushing for the legislation. Health Care for America Now, for example, is a consortium of unions and liberal groups that expects to spend $42 million on its wide-ranging pro-reform campaign.
More elusive groups
But outside such established interest groups is a significant but more elusive collection of organizations, many of them particularly energized in opposition to Democratic health-care reform efforts. Most are organized as nonprofits, meaning they do not have to reveal many financial details beyond basic revenue and expenses. Some are bankrolled by charitable foundations with a political bent or by industries with a financial stake in the debate; nearly all use names that seem designed to obscure their origins.
The Partnership to Improve Patient Care, for example, headed by former congressman Tony Coelho (D-Calif.), was formed by the drug industry in November 2008 to lobby against binding government effectiveness studies, which could be used to determine what insurance companies must cover. The American Council on Science and Health is an industry-friendly group whose board member Betsy McCaughey helped set off the "death panels" frenzy last year.
"It's sort of like money-laundering their PR," said Lisa Graves, executive director of the Center for Media and Democracy, a liberal-leaning group that runs a Web site called PRWatch.org. "A lot of these groups are heavily funded by corporations and then don't reveal it. They try to imply that they are funded primarily by individuals, but that's clearly not the case."
The Center for Medicine in the Public Interest (CMPI) is a New York-based think tank headed by Peter Pitts, a former Food and Drug Administration official who appears frequently on newscasts condemning Democratic health-care proposals. CMPI is an offshoot of the San Francisco-based Pacific Research Institute, which has received foundation grants over the years from Philip Morris, Pfizer and the Pharmaceutical Research and Manufacturers of America, according to public records.
While serving as president of CMPI, Pitts also works as the global health-care chief at Porter Novelli, a New York public relations firm whose clients include Johnson & Johnson, GlaxoSmithKline, Wyeth and Pfizer. He acknowledges that CMPI also receives money from the pharmaceutical industry, which is supporting reform legislation in exchange for a White House promise to limit cuts.