Health Insurance Companies Spend Big On CA Redistricting Fight
The article discusses how, amid a federal government shutdown caused by Democratic demands to extend enhanced Obamacare subsidies, two major health insurers-Blue shield of california and unitedhealth-have made significant political donations to support California Governor Gavin Newsom’s Proposition 50. This proposition aims to redraw congressional districts in a way that favors Democrats, representing a partisan power play rather than a policy issue. The insurers’ large contributions raise questions about their financial capacity amid rising costs from new mandates, such as compulsory cultural competency training regarding transgender issues and expenses related to a major ransomware attack.
The article suggests that these donations are not coincidental but reflect a pattern where big corporations fund politicians who support expanding government programs that benefit their interests. Both insurers reportedly benefited from no-bid contracts awarded by Newsom’s administration during the COVID-19 pandemic, indicating that their donations might potentially be attempts to maintain favorable political relationships-a form of “honest graft.”
The author argues that the root problem is the excessive government power to grant lucrative, no-bid contracts, wich incentivizes corporations to engage in political contributions to secure favor. Ending the enhanced Obamacare subsidies and reducing government intervention would, according to the article, diminish such politically motivated corporate behavior and reduce corruption.
In Washington, Democrats continue to keep the federal government shut down, demanding an extension of enhanced Obamacare subsidies scheduled to expire on December 31. Half a continent away, two health insurers are helping to fund a partisan campaign by one of the country’s most prominent Democrats. Coincidence?
The political donations represent but one more example of how big corporations want to feather the nest of Big Government and bankroll the leftist politicians willing to expand the same. It’s also yet another reason why Congress should let the enhanced subsidies expire as scheduled.
Big-Money Donations
A September story in the Sacramento Bee discussing money raised for and against the state’s Proposition 50 ballot measure on congressional redistricting noted two sizable donations from health insurers — $500,000 from Blue Shield of California, and $75,000 from UnitedHealth, the nation’s largest insurer. The news raises numerous questions, starting with how the insurers could afford such large political contributions in the first place.
After all, as I have previously noted, a recent California law that went into effect in March requires insurers to engage in “cultural competency training” regarding the transgender agenda. Apart from the fact that such training — more like indoctrination — likely violates employees’ First Amendment rights and federal conscience protections, it could also prove costly for insurers.
On top of the new administrative costs from this new mandate, UnitedHealth faces expenses from last year’s hack of Change Healthcare, one of its affiliates, that caused chaos within the health care system for months. So where and how exactly did these insurers have the wherewithal to make such large contributions?
Partisan Affair
The related question focuses more on the specifics of Proposition 50 itself. The referendum doesn’t touch on a health care-related issue — or really any policy issue whatsoever. It’s a pure political power play by Gov. Gavin Newsom, D-CA, attempting to gerrymander more Democratic-leaning congressional districts in California to offset Republican gerrymanders in Texas and elsewhere. Why are health insurers getting involved in such overtly political activities?
In responding to questions from the Daily Wire, Blue Shield of California claimed that it made its donations to Newsom’s ballot measure committee before it knew that Proposition 50 would end up on the November ballot. That’s arguably true regarding its first $250,000 contribution, made on April 24. But by the time of its second $250,000 contribution on July 16, rumors had started swirling about actions by California to respond to redistricting efforts by Texas Republicans.
Blue Shield of California also told the Daily Wire that it contributes to lawmakers on a bipartisan basis. But after its $500,000 contribution to Newsom’s ballot measure campaign, its next-largest contributions were $50,000 to the California Democratic Party, and $20,000 to the LGBT Caucus Leadership Fund — all of which suggests its donations go overwhelmingly to Democrats in a state with de facto one-party rule.
Big Insurance Loves Big Government
A plausible explanation for the sizable contributions comes from the Sacramento Bee’s reporting, which noted that both Blue Shield of California and UnitedHealth “benefited from no-bid COVID-19 contracts after donating to Newsom.” Did they ever — Blue Shield received a $15 million contract for vaccine distribution, and UnitedHealth subsidiaries “received at least $315 million in contracts, through expedited bidding process, for COVID-19 data tracking and testing.”
Therein lies the real reason for the contributions — good, old-fashioned “honest graft.” Blue Shield and UnitedHealth both won no-bid contracts from Newsom’s administration during the pandemic. Their executives likely thought they could contribute money to Newsom’s ballot measure committee as a way to say “thank you” and curry continued favor with the governor by donating to his political “slush fund.”
Except that Newsom and Democrats decided to respond to Texas’ redistricting with Proposition 50, converting the moribund ballot measure committee into an active political battlefield and putting the insurers in the middle of a partisan food fight. (UnitedHealth made its contribution to Newsom’s ballot measure fund on June 16, a few weeks before the talk about Proposition 50 accelerated.)
Drain the Swamp!
Of course, there’s an obvious solution to this mess: If government (both state and federal) didn’t have so much power to deliver no-bid contracts and the like, then insurers like Blue Shield of California and UnitedHealth wouldn’t need to engage in such apparently corrupt acts to try to curry favor with political officials.
That’s the best argument against ending the enhanced Obamacare subsidies. It isn’t just that two prominent insurers made sizable contributions to one of the nation’s most prominent Democrats at a time when they are trying to convince a Republican president and Republican Congress to spend another $350 billion (plus interest) in federal taxpayer funds. It’s that getting the taxpayer out of the picture will keep this type of corruption from happening in the first place.
Chris Jacobs is founder and CEO of Juniper Research Group and author of the book “The Case Against Single Payer.” He is on Twitter: @chrisjacobsHC.
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