There are many good reasons to root for Rep. Richard Neal’s political demise during Tuesday’s Democratic primary in Massachusetts. As chair of the powerful House Ways and Means Committee, he failed to aggressively pursue Donald Trump’s tax returns last year, slow-walking the process and allowing it to get bogged down in court. He’s also a notorious corporate buckraker, who shamelessly carries water for industries like insurance and tax prep. His opponent, Holyoke Mayor Alex Morse, is a solid progressive who seems to have been the target of a bizarre ratfucking operation orchestrated by a local group of College Democrats, with an apparent assist from the state party, aimed at smearing him with allegations of sexual misconduct.
But the most important reason why the congressman from Western Massachusetts needs to go really boils down to one issue: health care. If he remains on Capitol Hill, it will be more difficult for Democrats to pass any sort of meaningful reform under a Biden administration. Because he leads Ways and Means, which has jurisdiction over key areas of health care policy, Neal would likely play a major role in shaping any legislative effort to expand insurance coverage. But his instincts on the issue tend toward tepid and outdated half-steps like letting seniors buy into Medicare at 55. Worse yet, he’s quick to kill off legislation that threatens the profits of his donors.
That much became clear late last year, when Neal used his committee perch to squash bipartisan legislation that would have ended the scourge of surprise medical bills, one of most grotesque and despised business practices in American medicine. Surprise bills occur when patients visit an in-network hospital and unknowingly receive care from an out-of-network doctor, such an anesthesiologist or radiologist they may have never met. These charges regularly amount to thousands of dollars, and in some nightmare situations can reach six figures. They’ve also become disturbingly common: A third of adults under 65 say their family has been hit with a surprise bill in the past two years.
Just about everybody publicly agrees that surprise bills are a problem (emphasis on publicly). But finding a solution for them has been a daunting political challenge, mostly because there are heaps of money at stake and nobody wants their ox gored. When Congress finally set out to tackle the issue, it sparked a massive and expensive lobbying battle that pitted doctors and hospitals against insurance companies and patients. Private equity firms that have invested in physician staffing companies, and have made surprise-billing emergency room patients into a lucrative business model, also spent big on the fight.
There are two basic strategies for ending surprise bills. Both of them require insurers to compensate doctors and hospitals for their services, and only ask patients to chip in what they’d normally owe for in-network care. But in one system, known as benchmarking, insurers pay a rate set by the government, based on the typical price of a procedure. Insurers and patient groups like it, because it keeps costs down. In the other system, the insurers and providers who can’t agree on a payment settle their dispute in arbitration. Doctors, hospitals, and their Wall Street backers prefer this, because they think it usually ends in higher payouts.
By late last year, it seemed Democrats and Republicans in both chambers of Congress had finally settled on compromise legislation that split the difference between each side’s position, using benchmarking for small bills and arbitration for bigger ones. At the last minute, however, Neal and his Republican counterpart on the Ways and Means Committee, Rep. Kevin Brady, threw a grenade into the effort by announcing that they had a new proposal, one much closer to what the hospitals and private equity barons had sought. With Democrats suddenly at odds, House leaders dropped the bill from their end-of-the-year spending package, detonating the deal and punting the topic to 2020, at the earliest.
Neal has claimed that he was simply attempting to offer a better piece of legislation. “I wish every reporter would go back and take a look at who was on the other side of this issue,” he told the Washington Post. “I support the patient, the hospitals, the doctors, and the consumers. The insurance industry’s on the other side of this, and I feel quite confident to say I don’t think Alex Morse knew who was on the other side of this issue.” But to anyone familiar with the ins and outs of the surprise billing debate, this excuse was transparently silly—he’d broken up a painstaking legislative compromise by offering a proposal much more favorable to the hospitals and financiers who also happen to be some of his biggest donors. The private equity giant Blackstone Group, a major player in the physician staffing business, has handed him $32,000 in donations in the past two years. While he’s long collected large amounts from provider groups, the American Hospital Association’s political action committee has gone all out this year, spending $496,675 boosting Neal’s reelection campaign, according to Open Secrets. As Sludge’s Donald Shaw reports, the congressman was a featured speaker at the AHA’s annual conference, where president Rick Pollack introduced him as the group’s “friend in Washington.” (Neal has also accepted cash from health insurers like Blue Cross Blue Shield, which gave $32,000 this cycle, and the pharmaceutical industry as well).
To be blunt, it is very, very difficult to imagine a close buddy of the AHA, which also opposes ideas such as a Medicare-based public option, getting on board with any kind of ambitious health care reform agenda.
In the end, Neal can’t stop a bill entirely on his own. Other House committees can write health care legislation, and Nancy Pelosi can bring pretty much whatever she wants to the floor, which is why the death of the surprise medical bills legislation raised questions about whether progressives could trust the speaker herself when it came to health care. Beyond that, if it does come time for a big insurance reform bill, it’s possible that anything passed by the House will just get big-footed by whatever the Senate produces.
But Neal’s continued presence in Congress would almost certainly make the path of reform harder, both because of his formal influence and his informal sway within the caucus. At the moment, there’s a quiet debate among Democrats in Congress about whether the party should pursue a strong public option like Joe Biden has proposed on the campaign trail, or take a much narrower approach perhaps focused on beefing up Obamacare’s subsidies and passing prescription drug reform. If Neal keeps his seat, he’ll almost certainly push for extreme incrementalism. It might be a slight exaggeration to suggest, as writers like Jon Walker and Ryan Cooper have in their good pieces about Neal, that his survival will be a death knell for any kind of serious reform. But it would send a signal to his colleagues like Pelosi, who has thrown all her support behind him in this race, that there might not be much of a price to pay for kowtowing to donors by pursuing moderate reforms at the expense of normal families. Let’s hope Neal finally gets the boot.
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