SPRINGFIELD -- Lawmakers who will play pivotal roles in setting up Illinois’ health-benefits exchange — an entity designed to make health insurance more affordable for consumers and small businesses — are among the top recipients of cash from the insurance industry.
One consumer group says campaign contributions make it likely the Illinois Health Benefits Exchange Legislative Study Committee will issue recommendations later this month that benefit the insurance industry at the expense of consumers.
The recommendations are expected to become a blueprint for legislation to be considered in the fall veto session.
“We’ll see what happens,” said Jim Duffett, executive director of the Champaign-based Campaign for Better Health Care . “I hope I eat crow on Sept. 30. I kind of doubt that I will eat crow.”
Democrats Frank Mautino and William Haine and Republicans JoAnn Osmond and Bill Brady are co-chairpersons of the study committee, which is expected to make recommendations to the General Assembly by Sept. 30 on how the exchange should be governed and funded.
The four have served on insurance committees in the Illinois House and Senate and have received a combined total of $70,800 from the insurance industry so far this year.
Each of the co-chairs received more than almost all other lawmakers, except the Democratic and Republican legislative leaders in both chambers.
A similar trend in contributions was evident during 2009-10, when the four received a total of $404,265 from the insurance industry. During that period, Brady received about $356,600 from the industry during his unsuccessful campaign against Democrat Pat Quinn in the race for governor.
Another top recipient of industry contributions is Sen. Dave Syverson, R-Rockford, a member of the study committee who works part time as a health-benefits consultant.
The contribution totals are based on an analysis of campaign donations reported to the State Board of Elections. The donations were sorted by the nonpartisan Illinois Campaign for Political Reform at the request of The State Journal-Register.
Three of the four co-chairs returned phone calls from the newspaper and said contributions from the industry won’t affect their decisions on the health-insurance exchange.
“I don’t know that it taints me at all,” said Osmond, R-Antioch. “We’re just trying to figure out how this is not going to bankrupt the state and be efficient.”
Osmond formerly owned an insurance agency but said she sponsored consumer-friendly legislation in 2003 that made it harder for insurance companies to use credit scores to deny or cancel coverage.
Mautino, D-Spring Valley, said, “I try to be fair on both sides” and added that he sponsored legislation that created a managed-care patient “bill of rights.”
Brady, R-Bloomington, said, “My public policy philosophy has been consistent.”
Haine, D-Alton, didn’t return phone calls.
Mautino said members of the study committee, and especially the co-chairs, were chosen by legislative leaders based on expertise in handling insurance-related issues.
He said state-level exchanges, scheduled to begin operating by 2014, will be integral to the success of the federal Affordable Care Act, and Illinois’ exchange will assist as many as 1 million Illinoisans in affording health insurance though a range of private health plans. The exchange also will qualify people for federal subsidies and route some people into the Medicaid program.
“You’re setting up one of the most complex systems,” Mautino said. “It can’t make mistakes.”
Insurance-related “interests” as a group are among the top 15 private-sector contributors to campaign funds maintained by Illinois legislators, political parties and constitutional officers, according to Kent Redfield, professor emeritus of political science at the University of Illinois Springfield.
Individuals and groups representing the insurance industry typically give $1.5 million to $2 million during the two-year election cycles. That compares to $16 million from labor unions and $6 million from lawyers, Redfield said.
It’s not surprising that longstanding members of insurance committees in the House and Senate receive more contributions than other lawmakers, said David Morrison, deputy director of the Campaign for Political Reform.
“I wouldn’t say votes are for sale,” he said. But he said contributions help industry representatives get “face time” with key lawmakers.
A spokeswoman for the state’s biggest health insurance company, Chicago-based Blue Cross and Blue Shield of Illinois, said the company “supports political candidates, associations and organizations that share the health-care policy interests of our 12 million members.”
Based on Senate Bill 1555, passed by the General Assembly this spring, the four legislative leaders each chose three members of the health-benefits exchange study committee. The leaders’ choices suggest that insurance-industry contributions had an influence, Morrison said.
“The way that it looks … is terrible,” he said.
Duffett added, “There were a lot of other people they could have appointed. The House and Senate insurance committees have always been a subsidiary of the insurance industry.”
Steve Brown, spokesman for House Speaker Michael Madigan, D-Chicago, said campaign contributions played no role in Madigan’s picks.
Brown said Madigan considers whether a Democratic House member “will apply common-sense thinking to the issues at hand. That’s the only criteria that ever comes into play.”
Rikeesha Phelon, spokeswoman for Senate Majority Leader John Cullerton, D-Chicago, said Haine, as chairman of the Senate Insurance Committee, “brings a high level of expertise to the state’s discussion of health-insurance implementation.”
Spokespeople for House Minority Leader Tom Cross, R-Oswego, and Senate Minority Leader Christine Radogno, R-Lemont, didn’t respond to requests for comment.
Duffett said it’s in the interest of the legislative leaders, regardless of party, for the exchange to be successful, but an exchange influenced by the insurance industry might not maximize savings for consumers.
That’s why Duffett’s group wants the study committee to recommend legislation that would prohibit the insurance industry from being represented on the exchange’s board of directors.
Osmond and Mautino said the industry should be included on the board in some way. Bradley said he’s weighing that issue.
Osmond said, “We have to have somebody who understands insurance,” though Duffett said independent actuaries and other experts could serve that purpose on the board.
Mautino said industry representatives serving on the board of Illinois’ Comprehensive Health Insurance Program have helped, rather than harmed, the operations of the state’s high-risk insurance pool.
To fund the exchange, Brady said he favors the state using general revenue funds, while Osmond and Mautino said they haven’t decided what they favor.
Duffett’s group wants lawmakers to tax the insurance industry. He also backs legislation that would allow the state to block unjustified increases in insurance rates and prevent insurers from passing on the cost of the proposed tax to consumers.
Michael Gelder, the governor’s senior health policy adviser, said Quinn would like to be able to appoint at least some of the members.
“He wants to make sure the board is comprised of people who have as their goal the easy access to information and a competitive insurance market in Illinois,” Gelder said.
As to how the exchange should be funded, Quinn aide Brie Callahan said, “We are still exploring the range of potential revenue sources, but believe it’s important to choose a funding model that promotes the greatest participation in the exchange while also promoting transparency and effectiveness.”
The Illinois Health Benefits Exchange Legislative Study Committee will meet at 10:30 a.m. Thursday in Room 114 of the Capitol Building to hear testimony from representatives of the insurance industry and other interested groups.
The committee is planning another meeting for Sept. 21, but whether the meeting will held in Springfield or Chicago hasn’t been decided.
More information on the committee is available at http://tinyurl.com/exchangepanel.
Campaign contributions from the insurance industry to members of the Illinois Health Benefit Exchange Legislative Study Committee:
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