Today’s Washington Post reports that “The nation's largest insurers, hospitals and medical groups have hired more than 350 former government staff members and retired members of Congress in hopes of influencing their old bosses and colleagues.”  And here’s the kicker:  “Nearly half of the insiders previously worked for the key committees and lawmakers, including Sens. Max Baucus (D-Mont.) and Charles E. Grassley (R-Iowa) debating whether to adopt a public insurance option opposed by major industry groups.” 

Indeed, at least 50 former employees of the Senate Finance Committee or its members now lobby on behalf of the health care industry. Here you’ll find a Washington Post “Sphere of Influence” graphic showing how 41 lobbyists are linked to specific members of the Finance Committee.  (Note Max Baucus at the center near the top of the circle.)

The health care industry has embarked on “a record-breaking influence campaign” the Post observes,  “spending more than $1.4 million a day on lobbying in the current fight, according to disclosure records. And even in a city where lobbying is a part of life, the scale of the effort has drawn attention. For example, the Pharmaceutical Research and Manufacturers of America (PhRMA) doubled its spending to nearly $7 million in the first quarter of 2009, followed by Pfizer, with more than $6 million.”

But here’s what’s most troubling: “The push has reunited many who worked together in government on health-care reform, but are now employed as advocates for pharmaceutical and insurance companies. A June 10 meeting between aides to Baucus, chairman of the Senate Finance Committee, and health-care lobbyists included two former Baucus chiefs of staff: David Castagnetti, whose clients include PhRMA and America's Health Insurance Plans, and Jeffrey A. Forbes, who represents PhRMA, Amgen, Genentech, Merck and others.” These are people who know each other—and know a great deal about each other.  Presumably some of them are friends. How hard will it be for Baucus to say “no” to a former chief of staff?

Especially when it comes to voting for a public-sector insurance option that would compete with private insurers—and try to contain unnecessary spending– Baucus must find himself in an awkward position. As the Post points out:  “Although many firms have vowed to help cut costs, major players such as PhRMA, America's Health Insurance Plans and others remain opposed to the public-insurance option, a key proposal that President Obama has endorsed.”

Some of these lobbyists are old friends. Obama is a new friend. How does a Senator choose? 

So far, although “Several major Democratic bills include such a plan . . .  Baucus's committee — which is acting as the central broker in the debate — has not committed to the idea. Instead, the Finance Committee has focused recently on private-insurance cooperatives and other proposals seen as more palatable to the insurance industry and centrist Democrats.”

But Baucus Will Not Have the Last Word

As I have suggested in the past, I believe that, in the end, the Obama administration will play a major role in brokering the final version of health care reform. The bill that the Senate Finance Committee crafts may or may not bear much resemblance the health care legislation that lands on the President’s desk in October. 

There are, after all, two legislative chambers on the Hill. Even if the Senate takes its cue from Baucus’s committee, the Senate version of reform is going to have to be reconciled with a House bill. And it is very likely that the House version will contain a public-sector insurance option. Then, as I have written in the past,  at the very end of the legislative process, “There will be a final scrum—late night meetings, when the pieces are put together—just as there were  exhausting meetings when the fiscal stimulus package came together. The White House will be in charge, and some special interests will have their heads handed to them– to their total and utter surprise. Once again, White House budget director Peter Orszag will be a key player.

“Will the president get everything he hopes for? Probably not.” But I still  predict that the president will insist on structural changes to the system that will  help rein in health care inflation over the long-term. And I suspect that means the legislation will contain a robust public-sector plan, because, as I wrote recently, only a public-sector plan would have the “standing”—morally and politically—to make the decisions that have to be made if we are going to squeeze out the waste in our health care system. Patients and physicians just won’t accept coverage decisions made by a for-profit insurer—even if those insurers are doing their best to protect patients from unnecessary care. 

Let me add: all of the details regarding a public plan may not be clear in the bill the president signs in October. Everything does not have to be made explicit in this year’s legislation. In fact, shaping a public-sector insurance plan will be a process that no doubt will require amendments along the way.

But we shouldn’t put too much emphasis on what the Senate Finance Committee does or doesn’t include in its version of the bill. Senator Max Baucus will not be the final architect of health-care reform. That’s why I’m troubled—but not discouraged—by the Committee’s personal ties to the special interests who hope to hijack the president’s plans for reform.