Health Care Lobbying Expenditures Increase by Over 70 Percent in 2 Decades: Study

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The share of money heading towards lobbying activities on Capitol Hill is increasingly coming from health care companies. The number of dollars spent on health care lobbying grew by more than 70 percent between 2000 and 2020.

The figures were recently published in new research in JAMA Health Forum after researchers performed a cross-sectional study to shine some light on a topic that they say was for years under-examined.

The study, “Lobbying Expenditures in the US Health Care Sector, 2000-2020,” found that over the 20 years the researchers extracted data from health care lobbying dollars spent rose from $358.2 million in 2000 to $713.6 million in 2020.

“There’s a lot that goes on with lobbying, it’s not just about money, but it’s almost never not about money too,” said Dr. Peter Ubel, a medical doctor and the Madge and Dennis T. McLawhorn University Professor of Business, Public Policy and Medicine at Duke University in an interview with The Epoch Times.

The Biggest Spenders

In 2020, pharmaceutical companies as well as health product manufacturers were the biggest spenders, collectively spending $308.4 million on lobbying.

Health care providers including health professionals, hospitals, nursing homes, and associated trade organizations, were the second largest spenders, with $286.9 million in expenditure. Payers like insurers and health maintenance organizations spent $80.6 million.

Why the Expenditure Had a Big Increase in the First Decade

The study found that the most severe increase in spending in the health care lobbying sector came in the first decade of the study, between 2000 and 2010. The authors stated this increase was in part due to the targeting of the Affordable Care Act.

An article written by Dr. Robert Steinbrook, a physician at the Yale School of Medicine and a medical writer, in 2009 identified a multitude of policy issues that at the time were in flux with the new Obama administration and its health care-focused policy agenda. The issues included negotiations between the federal government and pharmaceutical companies over the cost of Medicare drugs.

Another item being examined was a change to the way physicians and other providers were compensated under the Medicare program, attracting the attention of provider groups, as well as the worry that a national health plan would take away significant revenue from insurance companies.

Steinbrook also said issues such as abortion coverage taxes were parts of the discussion.

Trends in Health Care Lobbying Expenditure

In 1970, it was difficult to find a health care-specific company on the Fortune 100 list. Now, in 2022, three of these companies–CVS, UnitedHealth Group, and McKesson–are in the top 10.

As a result, explains Ubel, most of the health care lobbying at the time came from health care provider groups, who not only lobbied to increase their bottom line but also helped ensure legislation and public policy meshed well with the current medical guidelines.

As health care companies began increasing their share of the market, so did their expenditures on lobbying activities. As they began to diversify the services they provided, the groups also had to expand their lobbying activities to cover all of their bases.

“The lobbying has become more diverse,” said Ubel. There are more big companies that aren’t just physician groups or hospital groups. “There are bigger device companies, bigger drug companies, there are also more diverse health care companies.”

It’s not uncommon for larger health care companies to have interests and business divisions in different health care sectors.

For example, the largest health care company in the United States currently, CVS Health Corp, has subsidiaries, ranging from retail pharmacies to on-site clinics employing providers to treat minor illnesses and provide immunizations.

The company also has its own brand of medicines, a prescription benefit service–CVS Caremark, and an in-home infusion service which according to the company’s 2015 Annual Report treated more than 140,000 patients per year.

“Instead of doing one thing, [large health care companies] do five things,” says Ubel.

However, Ubel says that the reasons why different organizations lobby differs between groups.

“One of the reasons people lobby is because they are trying to promote the bottom line of their organization,” Ubel said. “For a for-profit company, that might be maximizing profits, non-profits might just want to make sure they don’t lose money or don’t have to cut salaries.”

But not all lobbying is just about money. Sometimes legislators and policymakers rely on subject matter experts to help explain and interpret proposed bills and regulations.

A hypothetical example would be a congressman reaching out to a cardiology provider group to help interpret a new policy or law affecting heart-transplant drugs.

“There are cardiologists who are making sure that regulations relating to cardiology have a full understanding of what that kind of medical practice involves,” Ubel said.

Other Trend: A Small Number of Firms Take Control

Another trend identified in the study was that a small number of firms control a large percentage of the lobbying business in the health care sector.

According to the study the majority of lobbying spending by payers, manufacturers and providers went to the top 10 percent of firms.

Companies in other health care sectors followed suit, with the top 10 percent of firms spending more than a third of their total lobbying funds as well. The authors speculated that the small concentration of firms could mean that many constituents are left out of the policy-making process that occurs in congress.

Limitations of the Study

The authors also identified limitations of the study, specifically that the data they collected on lobbying expenditures might not include sums paid that were below the minimum reporting threshold.

The data collected was also not divided between lobbying dollars spent at the federal level and those at the state and local levels. The authors also identified the difficulty in picking out health care-lobbying expenditures made by firms outside the health care sphere.