Drug Companies Spent Millions to Support “Dark Money” Group Pushing to Eliminate Affordable Care Act

The following story was printed with permission from Kaiser Health News


In 2010, before the Affordable Care Act was passed by Congress, the pharmaceutical industry’s top lobbying group was a very public supporter of the measure. It even helped fund a multimillion-dollar TV ad campaign backing passage of the law.

But last year, when Republicans mounted an aggressive effort to repeal and replace the law, the group made a point of staying outside the fray.

“We’ve not taken a position,” said Stephen Ubl, head of the organization, the Pharmaceutical Research and Manufacturers of America, known as PhRMA, in a March 2017 interview.

That stance, however, was at odds with its financial support of another group, the American Action Network, which was heavily involved in that effort to put an end to the ACA, often referred to as Obamacare, spending an estimated $10 million on an ad campaign designed to build voter support for its elimination.

“Urge him to repeal and replace the Affordable Care Act now,” one ad running in early 2017 advised viewers to tell their congressman. That and similar material (including robocalls) paid for by the American Action Network ran numerous times last year in 75 congressional districts.

PhRMA was one of AAN’s biggest donors the previous year, giving it $6.1 million, federal regulatory filings show. And PhRMA had a substantial interest in the outcome of the repeal efforts. Among other actions, the GOP-backed health bill would have eliminated a federal fee paid by pharmaceutical companies, one estimated at $28 billion over a decade.

But there was no way the public could have known at the time about PhRMA’s support of AAN or the identity of other deep-pocketed financiers behind the group.

Unlike groups receiving its funds, PhRMA and similar nonprofits must report the grants in their own filings to the Internal Revenue Service. But the disclosures don’t occur until months or sometimes more than a year after the donation.

The conservative-leaning AAN has become one of the most prominent nonprofits for funneling “dark money” — difficult-to-trace funds behind TV ads, phone calls, grass-roots organizing and other investments used to influence politics. Such groups have thrived since the Supreme Court’s Citizens United decision in 2010, which loosened rules for corporate political spending, and amid what critics say is nonexistent policing of remaining rules by the IRS.

(It’s impossible to know from public records whether PhRMA donated before or after President Donald Trump’s victory, which made repealing the health law a substantial possibility. In any case, most donations to dark-money groups are not earmarked for a particular program.)

Generally speaking, dark-money groups are politically active organizations, often nonprofits, that are not required to disclose identities of their donors. Under IRS regulations, donors may fund a nonprofit group such as AAN, which is allowed to engage in political activities and is not required to reveal its funding sources.

Dark-money groups are often chartered under Section 501(c)(4) of the tax law, which grants tax exemption to “social welfare organizations.” For those seeking to influence politics but stay in the background, 501(c)(4) designations offer two big advantages: tax exemption and no requirement to disclose donors.

Against the backdrop of high drug prices and its heaviest political expenditures in years, the pharmaceutical industry is directing substantial resources through AAN and other such groups that hide the identity of their donors and have few if any limits on fundraising.

“PhRMA has always been very aggressive and very effective in their influence efforts,” said Michael Beckel, research manager at Issue One, a nonprofit devoted to campaign-finance transparency. “That includes using these new, dark-money vehicles to influence policy and elections.”

PhRMA’s $6.1 million, unrestricted donation to AAN was its single-biggest grant in 2016, dwarfing its $130,000 contribution to the same group the year before. Closely associated with House Republicans — AAN has a former Republican senator and two former Republican House members on its board — the group backed the failed GOP health bill intended to replace the Affordable Care Act. It also supported the successful Tax Cuts and Jobs Act of 2017, which reduced corporate taxes by hundreds of billions of dollars over a decade.

So far in this election cycle, AAN has given more than $19 million to the Congressional Leadership Fund, a Republican super PAC with which it shares an address and staff, according to the Center for Responsive Politics. The fund recently ran ads opposing Democratic candidates in high-profile special congressional elections in Georgia and Pennsylvania.

PhRMA disputes the suggestion that it backs particular actions by the recipients of its donations. “PhRMA engages with groups and organizations that have a wide array of health care opinions and policy priorities,” said its spokesman, Robert Zirkelbach. “It is inaccurate and would be inappropriate for you to attribute those grants to a specific campaign.”

AAN declined several requests for comment.

Including AAN, PhRMA gave nearly $10 million in 2016 to politically active groups that don’t have to disclose donors, its most recent filing with the IRS shows. By contrast, PhRMA and its political action committee, or PAC, made only about $1 million in comparatively transparent political donations in 2015 and 2016 that were disclosed to regulators and reported by the Center for Responsive Politics.

PhRMA’s 2016 political activities included support for the Republican National Convention. Rather than directly support the Cleveland convention, which several companies pulled out of after it became clear that Donald Trump was going to be the presidential nominee, PhRMA routed $150,000 through limited liability companies with names like Convention Services 2016 and Friends of the House 2016.

Like 501(c)(4)s, LLCs do not have to disclose their donors. PhRMA’s support was revealed in IRS filings more than a year later. (Donations by PhRMA and other groups to Friends of the House, which financed a luxury lounge for convention dignitaries, were first reported by the Center for Public Integrity last fall.)

PhRMA’s surge in donations to AAN coincides with the arrival of Ubl, who took over as president and CEO in 2015 and has long-standing ties to Norm Coleman, a former U.S. senator from Minnesota who is now AAN’s chairman. Ubl once ran the lobby for makers of knee implants, heart stents and other medical devices, one of whose most powerful members, Medtronic, is based in Minneapolis.

Dues paid by member drug companies rose by 50 percent after he got there. PhRMA’s total revenue increased by nearly a fourth in 2016, according to IRS filings.

PhRMA’s 2016 dark-money contributions included $150,000 to Americans for Prosperity, a conservative group associated with billionaires Charles and David Koch. Their group has already signaled it will be active in November’s elections, running attack ads against Sen. Jon Tester, a vulnerable Montana Democrat, for not supporting ACA repeal.

PhRMA also gave $50,000 to Americans for Tax Reform, run by conservative anti-tax activist Grover Norquist.

PhRMA and other trade associations donate to such groups “to avoid attracting attention” amid the political fray, said Bruce Freed, president of the Center for Political Accountability, which seeks to shed light on corporate political spending. Nevertheless “they’re achieving their goals by giving money to these folks and helping elect members that are going to be in support of them.”

Mostly smaller amounts went to centrist and liberal groups. Center Forward, which claims to seek bipartisan, common ground on drug policy and other issues, got $300,000 directly from PhRMA and another $179,000 from a PhRMA-backed group called the Campaign for Medical Discovery, according to tax filings.

Zirkelbach disputed the notion that PhRMA donations to AAN and other groups were intended to achieve specific goals, saying, “We seek to work with organizations we agree with as well as those where we have disagreements on public policy issues.”

Much of the work by PhRMA-linked, dark-money groups touches health policy and harmonizes with PhRMA’s positions.

During debates over the tax overhaul, Center Forward worked to preserve a tax credit for researching rare-disease medicines known as orphan drugs. PhRMA took a similar stance, encouraging Congress “to maintain incentives” for rare-disease drugs.

AAN, which collected total contributions and grants of $14.6 million for fiscal 2016, launched a $2.6 million mass-mailing and ad campaign against letting Medicare lower drug prices through negotiations. PhRMA supported that stance, telling Healthline that such a measure could jeopardize seniors’ access to medicine and discourage companies from developing drugs.

Americans for Tax Reform ran similar ads in local markets opposing “price controls” on prescription drugs.

PhRMA’s dark-money allies push its agenda without disclosing its role, critics say.

PhRMA is “spending millions of dollars on politics every cycle, and they’re splitting it up between the state and federal level,” said Robert Maguire, political nonprofits investigator for the Center for Responsive Politics, which tracks political donations. “They’re just not running the political ads themselves,” which keeps their name off the product, he said.

A group called Caregiver Voices United, which got $720,000 from PhRMA in 2016, backed a secret effort to generate letters opposing a drug-transparency bill in Oregon. The campaign surfaced when an employee leaked phone-script documents to a lawmaker, as reported in February by The Register-Guard newspaper in Eugene.

Caregiver Voices United is “not influenced” by PhRMA or any other outside group, said John Schall, its president.

Dark-money groups received pharmaceutical industry money from individual companies as well, not just the PhRMA trade organization.

In 2016, Amgen gave $7,500 to Third Way, a center-left group that supportsreimbursement for drugs and medical devices based on their results, according to the Center for Political Accountability. Johnson & Johnson gave $35,000 that year to the Republican Main Street Partnership, a 501(c)(4) that describes itself as a coalition of lawmakers committed to “conservative, pragmatic government,” the CPA data show.

But CPA’s research also reveals that many pharmaceutical companies don’t disclose donations made to 501(c)(4) organizations, nor are they legally required to.

Corporations “could dump millions into one of these (c)(4)s and nobody would ever know where it came from,” said Steven Billet, a former AT&T lobbyist who teaches PAC management at George Washington University.

KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

15.4% of New Yorkers Now Age 65+; Number of Persons in USA 100+ Rises to Almost 82,000

You can read all my blog posts at http://www.generationsofnewyork.com – 

Michael Burgess

In two months, I will join over 3 million New Yorkers who are 65 and older.  The number was  3,032,000 and 15.4% of the state’s population, according to the 2017 Profile of Older Americans, released by the federal Administration on Aging and  the Administration on Community Living.  The increase over a ten year period from 2006-2016 was 21.8%.   Florida has the highest percentage of persons 65+ at 19.9%.

Some of the findings of the new profile are:

• Persons reaching age 65 have an average life expectancy of an additional 19.4 years (20.6 years for females and 18 years for males).

Over the past 10 years, the population age 65 and over increased from 37.2 million in 2006 to 49.2 million in 2016 (a 33% increase) and is projected to almost double to 98 million in 2060.

• Between 2006 and 2016 the population age 60 and over increased 36% from 50.7 million to 68.7 million.

• The 85 and over population is projected to more than double from 6.4 million in 2016 to 14.6 million in 2040 (a 129% increase).

• Racial and ethnic minority populations have increased from 6.9 million in 2006 (19% of the older adult population) to 11.1 million in 2016 (23% of older adults) and are projected to increase to 21.1 million in 2030 (28% of older adults).

• The number of Americans aged 45-64 – who will reach age 65 over the next two decades – increased by 12% between 2006 and 2016.

• About one in every seven, or 15.2%, of the population is an older American.

• There were 81,896 persons age 100 and over in 2016 (0.2% of the total age 65 and over population.  In 1980 there were 32,184.

Key Political Analyst Says 7 New York House Members in Competitive Races but Only Two Are “Toss Ups”

The Crystal Ball, the report of University of Virginia political scientist Larry Sabato, is tracking 7 of New York’s 27 Congressional districts which he views as in play.  He rates only two as toss ups, the seats currently held by Republicans John Faso and Claudia Tenney in eastern and central New York.    He rates two other seats held by Republicans Lee Zeldin of Long Island and Dan Donovan from Staten Island as “leaning Republican.”  One Democrat, Sean Patrick Maloney, is rated as “likely Democrat.”   Maloney is also trying to win the September primary for State Attorney General.  If he were to win the primary, Democrats would have to find a new candidate in the Congressional district very quickly and that could change the status of the race.

The districts of two Republicans, Tom Reed and John Katko in central New York and the Southern Tier, are considered to be “likely Republican.”  All the remaining New York House seats are considered “safe” for the incumbents or the party holding them.  That includes the seat in the Rochester area of the late Louise Slaughter which is considered safe for the Democrat winning the September primary.  New York State Assembly Majority Leader Joe Morelle is considered the front runner in that district.

Sabato’s most recent report on his website now is giving Democrats a better than 50-50% chance to take control of the House of Representatives in November.   Democrats need to take over 23 Republican seats to win the House majority.

Senators Collins and Casey Bill “Supporting Grandparents Raising Grandchildren Act” Signed Into Law

Earlier this month, President Trump signed into law the  Supporting Grandparents Raising Grandchildren Act  sponsored by Senators Susan Collins and Bob Casey in the Senate and Rep. James McGovern in the House.    The law recognizes the unique difficulties of 2.6 million grandparents caring for their grandchildren, many of whom doing so because of opioid and drug abuse by the children’s parents.   The bill creates a task force that will come up with a one stop clearinghouse to provide information for grandparents on legal and custody issues, mental health and other social services which can assist the grandparents.

“With so many parents struggling with addiction, grandparents are increasingly coming to the rescue and assuming this role,” said Sen. Susan Collins, R-Maine. “It is essential that we do all that we can to help these families.”

“I am pleased that the Supporting Grandparents Raising Grandchildren Act has been signed into law. This law will provide grandparents in Pennsylvania, and across the nation, with easy access to helpful resources,” said Senator Casey. “These grandparents, some of which have stepped in to raise their grandchildren due to the opioid crisis, are faced with unique challenges such as delaying retirement, bridging the generational divide, and working through the court system to secure custody. I look forward to the Administration swiftly convening the advisory council created under this legislation so grandparents can access the supports they need.”

Older White Women – Retired Teachers, Librarians, Health Workers, Businesswomen -Are Key Political Organizers Against Trump in Key States

Even though Donald Trump got 52% of the vote among white women in 2016 and he won the senior 60+ vote, older white women are taking the lead in local political organizing activities against him and his agenda, according to research done by Harvard professor Theda Skocpol.    Soon after the election, she began visiting counties where Trump won in key midwestern states and she found that in every one there were women taking the lead in local groups.  Specifically she found the women were “older, college-educated white women: retired teachers, librarians, health care people, some businesswomen.”  The same activism has also been seen among local activists in New York State as well, including in upstate regions with Republican members of Congress.

The women who are retired obviously had time for these political activities and they also had the motivation.  The first big battle of the Trump Administration was about repealing the Affordable Care Act and many of these women may had involvement with health issues.  Of course, the day after Trump was inaugurated there was the Women’s March in Washington and in hundreds of local areas.  These marches  created the framework for nationwide activism for women.   In addition, Trump’s comments about women and news reports of alleged sexual harassment have fueled women’s activism.

While the research focused on these white women in states Trump won, African American women have also been some of the strongest supporters of Democratic candidates and they have played key roles in opposition to Trump.  Their activism was noted in the victory of Alabama Democratic Senate candidate Doug Jones over Republican Roy Moore.

Click the link below to the story in the Huffington Post,  “The Political Re-Awakening of the Middle Aged Suburban White Woman.”





Village Movement Grows in Albany Area as Research Shows “Positive Friendships” Are Key Characteristic of “Blue Zones”

The Albany Guardian Society has organized a Capital Region Villages Collaborative to promote the development and networking of “villages” in the region.  Last fall, the Guardian Society sponsored a conference that attracted about 200 persons to discuss the village concept and aging in place or the community of your choice.    The Guardian Society also submitted a proposal that was funded by the New York State Office for the Aging to provide a small amount of money to support organizations promoting villages.  Community Caregivers which serves most of Albany County received funding as well as a group in Shenendehowa, Saratoga County, another group in northern Columbia County, southeast of Albany and to Westchester Center for Aging in Place.

Community Caregivers will partner with local residents in the City of Albany and the adjacent Town of Bethlehem to develop villages there.  Preliminary meetings were held in the spring with follow up planning meetings set to take place in August and September.  The goal is to try and create a framework for the villages by the end of the year.

The New York Times reported in an article on July 17, “The Power of Positive People,” that “friends can exert a measurable and on-going influence on your health behaviors in a way that a diet never can,” according to Daniel Buettner, a National Geographic author.  Developing positive social networks like villages can be a big part of giving older persons a sense of security by being in a caring and supportive community.    Positive friendships are a prominent characteristic of the “blue zones,” those communities of the world where residents live far longer than the average lifespan.

To read more about the blue zones, go to http://www.bluezones.com

In the initial meeting in the Town of Bethlehem, one of the seniors noted she had been meeting with a group of six persons called the “Conscious Aging” group.  She said they get together to discuss issues of concern about getting older that are on their minds, including death and dying.  This type of small group of friends can be an important idea of the village to promote for its members.

Senator Marco Rubio Proposes Eroding Social Security Benefit by Allowing it to be Used for Family Leave

the following information was prepared by the New York State Alliance for Retired Americans

Sen. Marco Rubio (FL) will introduce legislation that would supposedly create national paid parental leave, but in fact would mean cuts in future earned Social Security benefits. While the United States is the only developed nation that does not offer paid leave, Sen. Rubio’s plan forces families to choose between caring for a new child and risking their financial security in retirement.

The proposal would allow parents of newborns or newly adopted children to take twelve weeks from their Social Security benefits early, later reducing or delaying that person’s benefits at retirement age to make up the difference. Retirees would have to delay their Social Security benefits by approximately twenty five weeks per each paid leave, more than twice as long as the initial time off.

Carrie Lukas of the Koch brothers’ funded group Independent Women’s Forum developed the plan on which Rubio’s bill is modeled. Lukas specifically said that the plan will speed the privatization of Social Security by changing public perception of the system from a social  insurance program to a system of personal accounts — and make it easier to raise the retirement age. She wrote, “Once people become used to the ideal of people opting to push back their retirement age, it may become less difficult to gradually raise the normal retirement age to reflect increases in longevity.”

The legislation would also harm the long-term financial outlook for Social Security. A recent study by the right-leaning American Action Forum found that Rubio’s legislation would cause the program to face a shortfall at least least six months sooner than it otherwise would.

Sen. Kirsten Gillibrand (NY) has introduced broader legislation granting paid leave to new parents and workers taking time off to care for a sick family member. Sen. Gillibrand’s proposal would have both workers and employers pay into a newly created fund that reaches every worker regardless of their job or industry.