They bill themselves as advocates for ordinary citizens taking on powerful insurance companies.
But in reality, the Campaign for Consumer Choice may not be so civic-minded.
The groups, which lobby in five states against the proposed mergers of leading health insurers, are orchestrated by the hospital industry.
The state groups’ nearly identical websites are brimming with information about how the mergers would hurt consumers, but there’s not a clue about the true nature of the campaign.
STAT has found that the campaign was created and funded by the Greater New York Hospital Association and SEIU 1199 United Healthcare Workers East, a union representing employees in hospitals, clinics, and other health centers.
State medical societies, with assistance from the American Medical Association, have also lent considerable support.
It is the latest example of what critics call “Astroturf” — groups posing as grassroots causes that are actually run by hidden sponsors.
The targets of these groups are the proposed mergers of Cigna (CI) with Anthem (ANTM), and of Aetna with Humana (HUM), which the campaign says would restrict the public’s health insurance options. Left unsaid is another point: the resulting insurance behemoths could gain the power to negotiate lower prices for their members. For hospitals and their employees, that would translate into less revenue and fewer jobs.
Both deals are under review by the US Department of Justice. Insurance regulators in states where these companies are located, or sell policies, are also scrutinizing the mergers and may impose certain conditions. So the groups, created early this spring, are lobbying lawmakers, conducting polls, and pushing for media coverage in Connecticut, Virginia, Florida, Ohio and Colorado.
“The public deserves an honest debate about these and other issues,” said Jenn Topper, communications director of the Sunlight Foundation, which advocates openness in government. “The groups influencing important policy decisions should be transparent and accountable to the public they’re claiming to work on behalf of.”
David Balto, a longtime Washington antitrust lawyer who is organizing the campaign on behalf of the hospitals and union, rejected the critics’ depiction of the effort. Balto told STAT he is putting together coalitions of consumer groups that oppose the mergers. He said whoever is paying for the campaign’s polling, web development, public relations, and travel is not relevant.
“Who does what isn’t an important story,” Balto said. “What’s important is these mergers are tremendously anticompetitive.”
On each of its websites, the Campaign for Consumer Choice says the “mergers would mean that three insurance companies would cover 33 percent of the United States. One-third of all Americans will be forced to play by new rules for their health care” that in many cases might be written “without their knowledge and at the expense of their care.”
The websites quote both the American Hospital Association and the American Medical Association opposing the mergers as threatening to consumers and in violation of antitrust guidelines.
In each state, Balto has sought to enlist local consumer groups to join the cause, but the money and direction come from the unseen Healthcare Education Project, run jointly by the New York-area hospitals and the union.
Dave Bates, a spokesman for the hospital-union project, described it in an email as “a coalition partner” in the Campaign for Consumer Choice, along with a host of consumer groups. But several people working on the campaign confirmed that the hospitals and union are actually running the show.
Their joint project has retained five public affairs firms — the Democratic Smoot Tewes Group; 270 Strategies; Strategies 360; Graff Public Solutions; and Remington Road Group — to develop the grassroots campaign and secure support from state lawmakers.
“We want to make sure that the public is aware of what is transpiring,” said Matthew Katz, executive vice president of the Connecticut State Medical Society, which joined that state’s Campaign for Consumer Choice after being approached by Kevin Graff on behalf of the Healthcare Education Project. “What we are trying to do through CCC is shine light on the process and request transparency in the hearing process, the review process, and the commissioner’s determination.”
The Connecticut affiliate, which Katz said is also working with the American Medical Association, is the only one of the state campaigns that names any of its coalition members: the medical society, Connecticut Citizen Action Group, and Universal Health Care Foundation of Connecticut.
Even groups that have joined the campaign in opposing the insurance mergers find irony in a call for transparency from a group that doesn’t disclose its funding. “We always prefer transparency,” said Jesse Ellis O’Brien, health policy analyst for US PIRG, a consumer group that has signed on to some of the campaign’s letters to state officials.
Clare Krusing, press secretary for America’s Health Insurance Plans, which supports the mergers, said: “No one can ignore the irony of the hospital industry decrying mergers when its own consolidation is widely recognized for causing significant harm to consumers.’’
“As we’ve seen from multiple cases and economic studies, the incentive behind anticompetitive hospital mergers is to leverage dominant market power for higher rates,” she added.
The Campaign for Consumer Choice has made its voice heard in a short time. Polls conducted for the campaign in Florida, Virginia, and Ohio showed an overwhelming majority of citizens were very concerned about the mergers after being told by the pollsters that the mergers would likely “decrease competition, increase health insurance premiums, and stifle innovation.” The results were covered by state newspapers and generated other attention.
State lawmakers approached by the campaign have written op-ed pieces opposing the mergers, participated with the group in telephone press conference calls, and otherwise pushed its cause.
In Virginia, for example, Democratic State Senator Scott Surovell said he was contacted by 270 Strategies to take on the issue. He joined a recent conference call to publicize problems with the proposed merger and has been quoted in news articles opposing it. Surovell was also one of 12 state lawmakers who on May 4 called on Virginia Insurance Commissioner Jacqueline Cunningham to hold public hearings on the mergers.
In Ohio, Amanda Wurst, a consultant for the Campaign for Consumer Choice, said the group was able to persuade two state lawmakers, Heather Bishoff and Edna Brown, to hold a press conference to generate awareness of the mergers.
The role of outside groups organizing the opposition to the mergers is clearly sensitive. Until Tuesday, visitors to the Ohio Campaign for Consumer Choice website, who clicked on a link for more information, were transferred to the website for Smoot Tewes. After a reporter called Smoot Tewes and noted the link, it disappeared.
This story has been updated to clarify that the American Medical Association has assisted state medical societies that support the Campaign for Consumer Choice.