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May 12, 2004
CONTACT: Jerry Flanagan, (415) 633-1320
Chamber of Commerce Attacks Law to Insure 1 Million Patients, Opposes Cost Controls While Cosponsoring "Cover the Uninsured Week"In a letter sent today, a consumer group called on the Chamber of Commerce to divulge its "plan to cover the uninsured" given that while the Chamber is listed as a sponsor of the "Cover the Uninsured Week" it is leading efforts to overturn a 2003 California law, SB 2, designed to provide health insurance to 1 million uninsured patients. (The complete letter is available below).
The Chamber of Commerce has also opposed recent attempts by the California legislature and Congress to make health care more affordable, according to the Foundation for Taxpayer and Consumer Rights (FTCR).
In the letter to the U.S. Chamber of Commerce President Thomas Donohue and California Chamber President Allan Zaremberg, FTCR wrote:
"Not only has the Chamber spearheaded this ballot referendum [to overturn SB 2] but it has lobbied in the legislature against attempts to make SB 2's mandate for employers to buy health coverage more affordable. You appear to have done this on behalf of the Chamber's biggest supporters - insurers, pharmaceutical companies, hospitals, and other health care corporations who want to charge as much as they can without government interference. In the process you have prevented small business owners from getting cheaper health insurance to cover more of their workers."
The Chamber of Commerce is participating in television and radio advertising this week as part of a national effort to raise awareness of the plight of uninsured and underinsured Americans.
Several of the Chamber of Commerce's largest members have directly endorsed the "Cover the Uninsured Week" through their industry associations even though their profiteering has contributed to growing rates of uninsured and underinsured Americans, for example:
**Health Insurers - The Health Insurance Association of America has endorsed the "Cover the Uninsured Week" even though exorbitant insurer overhead costs have become the fastest growing component of health care spending.
**Hospitals - The American Hospital Association has been a staunch critic of efforts to control hospital costs even though their expenses make-up the largest portion of health care spending.
Another of the Chamber's most influential members, pharmaceutical companies, have opposed reimportation of prescription drugs from Canada because U.S. drugs sold there are 30-60% cheaper as a result of negotiated bulk discounts.
Under SB 2, employers with 50 or more employees must either provide health care benefits directly to workers or pay a fee for the worker to receive care from a health insurance purchasing pool. Claiming the financial impact of SB 2 would be too great for businesses to bear, the California Chamber of Commerce and allies qualified a referendum for the November statewide ballot which would overturn the law if approved by voters.
In the letter, FTCR pointed out a number of recent health care cost control bills that the Chamber of Commerce had opposed including legislation to require health insurers to justify premium increases to the California Insurance Commissioners and others to provide for lower cost prescription drugs. According to the FTCR's Jerry Flanagan, "controlling skyrocketing costs is the key to providing universal health care and that if the Chamber is serious about its support of universal coverage than it must get serious about supporting new policies to crack down on costs."
In the letter sent today FTCR wrote:
"It's great public relations to be part of 'Cover The Uninsured Week,' but where is Chamber's plan to cover the uninsured? You owe that much to small and medium size businesses you claim to represent, as well as the public."
Thomas Donohue, CEO U.S. Chamber of Commerce
Allan Zaremberg, President California Chamber of Commerce
RE: What Will The Chamber Do To Cover The Uninsured?
The Chamber of Commerce is listed this week as a sponsor of "Cover The Uninsured Week," which is ironic given the fact that the Chamber is leading an effort to repeal a new California law, SB 2, to provide 1 million uninsured Californians with health coverage.
Not only has the Chamber spearheaded this ballot referendum but it has lobbied in the legislature against attempts to make SB 2's mandate for employers to buy health coverage more affordable. You appear to have done this on behalf of the Chamber's biggest supporters -insurers, pharmaceutical companies, hospitals, and other health care corporations who want to charge as much as they can without government interference. In the process you have prevented small business owners from getting more affordable health insurance to cover more of their workers.
Just last week, the California Chamber of Commerce opposed SB 1349 (Ortiz, Sacramento), which requires HMOs to justify their exorbitant overhead costs to the Insurance Commissioner. The Chamber's opposition to this legislation is perplexing given that government data shows that health insurance overhead and administrative costs increased by 16.4 percent in 2002, after a 12.5 percent increase in 2001, making it the fastest growing component of health care spending over the past three years.
The Chamber has also opposed bills designed to control skyrocketing prescription drug costs by facilitating the importation of drugs from Canada (AB 1957, SB 1144, SB 1149) even though U.S. drugs sold in Canada are 30-60% cheaper as a result of negotiated bulk discounts. In addition, the Chamber has yet to support legislation, AB 1958 (Frommer, Los Angeles), to allow business owners and patients to join the California Public Employees Retirement System's (CalPERS) prescription drug bulk purchasing pool and a plan to standardize hospital rates.
Health insurers, hospitals and pharmaceutical companies are some of your largest dues paying members and each industry is a self-interested defender of the status quo. They support universal health coverage only if it puts more money in their pocket. That became clear during the debate on SB 2 when the doctors, hospitals and insurers that will be guaranteed new customers as a result of the law refused to allow any oversight of their rates. If the Chamber of Commerce is sincere about its support of universal access to care then it must turn its back on the profiteering of its largest members and help ordinary businesses who are priced out of health coverage.
It's great public relations to be part of "Cover The Uninsured Week," but where is Chamber's plan to cover the uninsured?
You owe that much to small and medium size businesses you claim to represent, as well as the public. I await your written reply.
The Foundation for Taxpayer and Consumer Rights is a non-profit and non-partisan consumer advocacy group. For more information, visit us on the web at http://www.CalHealthConsensus.org or http://www.consumerwatchdog.org
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