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Report: Consumers paying for campaign contributions

ALBANY — An Albany watchdog group says that campaign contributions from the health insurance industry to Senate Republicans have resulted in a failure by the Legislature’s upper house to regulate health insurance rates.

A report issued Wednesday by Citizen Action also advocates public financing of elections to “protect consumers from the grip of health industry contributors on state policy.”

“Our report found that the state Senate Republicans are the major beneficiaries of health insurance industry campaign contributions,” said Jessica Wisneski, the group’s campaigns director, in a press release accompanying the report.

“This addiction to industry campaign dollars explains why the state Senate has failed to act on legislation to rein in the high health insurance rates, and to establish … full public financing of elections,” she said. “As a result of the cozy relationship of the Senate Republicans to corporate dollars, consumers are paying a high price in higher health insurance rates, inability to afford health insurance, and poorer health outcomes.”

Citizen Action’s report, titled “The High Cost of ‘Pay-to-Play,’” analyzes campaign contributions to legislators and their campaign committees made between Jan. 1, 2003 and Dec. 31, 2007 by health insurance interests. The $899,175 in contributions break down by party conference as follows:

n Senate Republicans (majority): $618,152; 69 percent of the total

n Assembly Democrats (majority): $177,798; 20 percent

n Senate Democrats (minority): $63,900; 7 percent

n Assembly Republicans (minority): $39,325; 4 percent

In the late 1990s, the report said, state regulation of health insurance rates was “reduced.” As rates began to rapidly rise, legislation to “restore significant oversight of health insurance rates and industry profits” was introduced every year from 1998 through 2006. The Assembly passed this legislation each year, but the Senate did not.

“The Senate’s failure to pass this proposal has meant that New Yorkers have had to pay large health insurance rate increases,” the report said. “The investment the health insurance industry makes in campaign contributions is paid many times over in the form of higher profits.”

Citizen Action says this “pay-to-play” system gives the health insurance industry an unfair advantage over insurance consumers.

“This pattern of money and influence also demonstrates why supporters of health insurance reform cannot just work on health insurance legislation to achieve their goals,” the report states. “This report therefore calls for passage of clean elections, full public financing of campaigns, which would enormously help to even the power imbalance between the industry and consumers.”

The report listed the top 10 individual recipients as:

n Sen. James L. Seward, R-Oneonta, $60,700 — chair, Senate insurance committee

n Sen. Kemp Hannon, R-Garden City, $58,750 — chair, Senate health committee

n Sen. Joseph A. Bruno, R-Brunswick, $55,500 — former majority leader

n Sen. Thomas W. Libous, R-Binghamton, $54,750 — chair, select committee on the disabled

n Sen. Dean G. Skelos, R-Rockville Centre, $50,250 — current majority leader

n Sen. Michael A.L. Balboni, R-Nassau County, $34,800 — former member, Senate insurance committee

n Assemblyman Joseph D. Morelle, D-Irondequoit, $23,350 — chair, Assembly insurance committee

n Sen. John J. Flanagan, R-Smithtown, $16,250 — member, Senate insurance committee

n Sen. Neil D. Breslin, D-Albany, $15,350 — ranking minority member, Senate Insurance committee

n Assemblyman Sheldon Silver, D-Manhattan, $9,990 - Assembly speaker

“All New Yorkers and New York businesses that pay health insurance premiums are paying out of their pockets for the high price of the current ‘pay-to-play’ campaign finance system,” said Karen Scharff, executive director of Citizen Action. “That’s why it’s high time for all state Senate candidates to support clean elections. Until we change the system, consumers will pay the price.”

The complete report is available online at www.citizenactionny.org.

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