The Return of Double Bill

Legislation to curb surprise medical billing appeared to be headed toward passage until private equity firms launched a dark money campaign in opposition, recruiting Sen. Bill Cassidy to rewrite the rules in their favor. Since then, executives at the firms have showered the Louisiana Republican with nearly $60,000 in campaign cash, while the proposal appears to be stuck in idle.

A few years ago, back when I was living in Baton Rouge, I took a nasty spill after missing the step in between the garage and the backdoor of my house. I’ve never been steady on my feet, but I’ve always been skilled in the art of falling. I wasn’t so lucky that day and ended up in the emergency room with an ugly laceration above my right eyebrow. I’d been almost certain that I’d leave with stitches, but mercifully, the doctor on duty that day was able to patch me up with a little superglue and instructions to be more careful.

Weeks later, I received a bill from the hospital. They were asking for more than $4,000.

I knew enough about medical billing practices to figure out why: Someone had erroneously coded my injury as an animal bite. Animal bites are— pardon the pun— a cash cow for emergency rooms across the country. $4,000 was only a fraction of the total bill. (In 2019, the average cost of a dog bite claim in Louisiana was $39,654, according to the Insurance Information Institute, and that’s still lower than the national average).

Fortunately, in my case, I managed to bark loudly enough—again, pardon the pun—to convince the hospital they had made a mistake, and they zeroed out my bill for the superglued eyebrow.

Chances are that either you or someone you know has been a victim of surprise medical billing, which is one of the reasons Bill Cassidy has placed his work on the issue front and center in his campaign for a second term.

In September, the Cassidy campaign blanketed Louisiana with this ad:

If you didn’t know any better, you’d think that Cassidy was taking credit for something he had already accomplished.

****

Unless you’re a paid lobbyist for Big Pharma, you probably agree with the need to reduce the price of prescription drugs; it’s an issue that enjoys broad bipartisan support. Similarly, an overwhelming majority of Americans support efforts to end the practice of surprise medical billing.

“Surprise billing typically occurs when a patient is treated at a hospital that is in their insurance network by a medical professional who isn’t, potentially leading to crippling medical charges,” the Wall Street Journal explained in May. “The push to end surprise billing pits patient advocates and health-insurance providers, who back the effort, against hospital and medical groups who say it amounts to government rate-setting that would would jeopardize the finances of some hospitals and mean out-of-network doctors earn less money.”

It’s a simple explanation of the competing interest groups, and as it turns out, it’s not entirely true.

Last year, the proposal supported by patient advocates and providers sailed through the Senate Health, Education, Labor, and Pensions (HELP) Committee. The committee’s chair, Republican Sen. Lamar Alexander, is retiring after his term expires next January, and he’s made it clear that ending surprise medical billing is one of the things he hopes to accomplish on his way out. It had appeared, at least momentarily, that Alexander would get his wish.

But in the summer of 2019, a mysterious new “dark money” organization that called itself Doctor Patient Unity launched a blitz of ads specifically targeting 11 committee members, mostly Republicans, who supported the proposed legislation and who were believed to be vulnerable. In late July 2019, the group aired its first national ad on CNN, during a broadcast of a Democratic presidential primary debate. By May of this year, Doctor Patient Unity had spent more than $58 million on television, radio, and direct mailers, according to ad tracker Kantar/CMAG.

The ads were clever, emphasizing the organization’s support for ending surprise medical billing and blaming politicians and insurance companies for failing to take action. Doctor Patient Unity was especially aggressive against Sen. David Perdue of Georgia and Sen. John Cornyn of Texas.

Even though Cassidy sits on the HELP Committee and is currently running for reelection, the dark money group didn’t t pressure him with political advertising; instead, it spent more than $320,000 in Louisiana on “thank you” ads, encouraging voters to send a note of gratitude to Cassidy for his efforts to end surprise medical billing.

So who is behind Doctor Patient Unity? And why were they supporting Cassidy but attacking his Republican colleagues?

In September of 2019, the New York Times decided to do a little digging, and it discovered that the organization was nothing more than a front group for two private equity firms. “The two largest financial backers of Doctor Patient Unity are TeamHealth and Envision Healthcare, private-equity-backed companies that own physician practices and staff emergency rooms around the country, according to Greg Blair, a spokesman for the group,” the Times reported.

TeamHealth is a division of the Blackstone Group, which claims to be the largest alternative investment firm in the world, and Envision Healthcare is owned by Kohlberg Kravis Roberts & Co., better known as KKR, a private equity behemoth.

Physician staffing companies and emergency transportation companies have made the firms a fortune, largely through surprise medical billing. Following the Time‘s report, the House Energy and Commerce Committee launched an investigation in the firms’ activities.

“Evidence indicates that these physician staffing firms charge significantly higher in-network rates than their counterparts, thereby driving reimbursement upwards as they enter into staffing arrangements with hospitals,” Committee Chairman Frank Pallone, Jr. (D-NJ) and Greg Walden (R-OR) wrote in a joint statement. “We are concerned about the increasing role that private equity firms appear to be playing in physician staffing in our nation’s hospitals, and the potential impact these firms are having on our rising health care costs.”

“The Senate (HELP) Committee… drafted a bipartisan bill to end surprise billing by hamstringing both doctors and insurance companies,” Paul McLeod of BuzzfeedNews explained last week in “Here’s How Private Equity Firms Targeted Republican Sen. John Cornyn With Dark Money To Preserve Surprise Medical Billing.” “(The bipartisan bill) would put limits on how much out-of-network medical staff could charge and require insurers to cover the costs.”

Paging Dr. Cassidy.

Since the election of Donald Trump in 2016, Cassidy, a gastroenterologist, has attempted to fashion himself as a “policy wonk” on healthcare, a characterization that his hometown newspaper has been more than willing to repeat, even though it has very little basis in fact.

Not so long ago, the legacy media in Louisiana declared the same thing about a different Republican politician. By the end of Bobby Jindal’s second term as governor, the state’s once-robust charity hospital system was on life support; emergency rooms were closing due to budget cuts, and the state was losing out on billions of dollars because of his refusal to expand Medicaid.

Cassidy’s most notable healthcare policy proposal, a spectacular disaster known as the Graham-Cassidy Amendment, imploded as a result of intense public opposition and the scrutiny of a famous comedian.

On May 1, 2017, late night television host Jimmy Kimmel dispensed with his usual opening monologue. A week before, Kimmel had taken an unexpected hiatus from his show, and when he returned to work that day, he explained the reason for his absence: His newborn son Billy, who was born on April 21, had been diagnosed with a rare congenital heart defect. Three days after Billy was born, he was rushed into surgery, which had likely saved the little boy’s life.

Kimmel urged Republican lawmakers intent on repealing the Patient Protection and Affordable Care Act (better known as Obamacare) to leave in place provisions that guaranteed no one would be denied coverage due to a pre-existing condition.

Quoting:

Before 2014, if you were born with congenital heart disease like my son was, there was a good chance you’d never be able to get health insurance because you had a pre-existing condition. You were born with a pre-existing condition. And if your parents didn’t have medical insurance, you might not live long enough to even get denied because of a pre-existing condition. If your baby is going to die, and it doesn’t have to, it shouldn’t matter how much money you make.

Within 24 hours, Kimmel’s monologue had been watched online more than 14 million times. Former President Barack Obama shared it with his vast online following on Twitter. (Incidentally, Obama’s following on Twitter has always surpassed the following of his successor. For those keeping score, it’s Obama: 124.3 million; Trump: 87.3 million).

Bill Cassidy, acting on his own volition, responded to Kimmel’s plea during an interview on CNN, claiming that he would only support a proposal that passed what he called “the Jimmy Kimmel Test.”

Cassidy’s pledge had initially earned praise from both sides of the aisle. Kimmel invited him on his show, where Cassidy repeated his commitment to “the Jimmy Kimmel Test.”

Most of you know how the story ends.

In the months that followed, as Cassidy put the finishing touches on his proposal, it became obvious that he was either woefully ignorant of the mechanics of health insurance or he was lying with a straight face each and every time he reassured the American public that his plan would keep protections for those with preexisting conditions and guarantee that insurers would still be prohibited from denying coverage to those who reached their so-called “lifetime cap.”

Not only did Cassidy’s plan fail “the Jimmy Kimmel test,” it also would have taken money away from Louisiana.

“(Under Cassidy’s plan) analysts predict tens of thousands of Louisianians would lose the health care coverage they have gained under President Barack Obama’s Affordable Care Act,” the Times-Picayune explained in an editorial. “The most vulnerable are the more than 428,000 Louisiana residents who have signed up under the ACA’s Medicaid expansion since 2016.”

Kimmel was not amused, and ultimately, Cassidy was forced to table his plan.

****

With less than a week remaining until Louisiana voters decide whether to give him another six years in the Senate, Cassidy is unlikely to leave his hermetically-sealed (but COVID-friendly) campaign bubble and subject himself to substantive criticism. He’s managed to avoid debating his opponents, arguing, cynically, that he would only participate in a debate in which all 14 of his challengers were invited. It’s a precondition that would’ve been absurd in any other year but is especially egregious in a pandemic.

If he had participated in a substantive debate, he would have been forced to answer for the failure of Graham-Cassidy and explain why his plan would have disproportionately harmed Louisiana. It’s also likely that he would have been asked about his repeated attempts to downplay the threat posed by COVID-19. Among other things, Cassidy once told Fox News that “the only thing we have to fear is fear of the virus.”

We know now that President Trump had been well-aware of the threat of a large-scale pandemic as early as February 7 and that Trump, by his own admission, deliberately downplayed the imminent danger because he was more concerned about rattling the stock market. In hindsight, it now appears as if Cassidy was towing the same line coming out of the White House; he didn’t change his tune until March 13, four days after the Louisiana Department of Health reported that a Jefferson Parish man hospitalized in New Orleans had contracted the state’s first known case of Coronavirus.

Remember too that President Trump considers Cassidy to be the Senate’s leading expert on healthcare policy. “When I need to know about health insurance, preexisting conditions and individual mandates, I call Bill,” Trump once quipped. Why should anyone believe Bob Woodward was more informed about the potential for a pandemic than Bill Cassidy was?

And considering how Cassidy has emphasized his work on preventing surprise medical billing, it’s likely he would have also faced a question or two about the campaign donations he received from executives at the very same private equity firms behind the dark money group Doctor Patient Unity.

As it turns out, Doctor Patient Unity’s $58 million media blitz had a very specific objective: They hoped to build support for a rival bill on surprise medical billing, a proposal authored by none other than Bill Cassidy.

“Under Cassidy’s plan, insurers would still have to cover emergency room bills, but out-of-network doctors would not face specific benchmark limits on how much they could charge,” McLeod of BuzzfeedNews explains. “They would instead be able to take insurers to arbitration to negotiate rates for their services. It may seem like a minor change, but the difference between the two plans was worth billions of dollars (emphasis added).” 

Cassidy claims that if out-of-network physicians were subjected to benchmark limits it would disincentivize doctors from working in rural and underserved communities. But as Rep. Frank Pallone, Jr. explained in an interview on MSNBC, doctors aren’t the ones profiting from the status quo; Wall Street is.

“What we are seeing basically are these Wall Street firms, if you will, that are buying physician practices and placing physicians in the emergency room, for example,” Pallone told Katie Tur. “So they are basically reaping the profits. It’s not the physicians. It’s these- they call them ‘venture capitalists’ or ‘private equity groups;’ I call them ‘Wall Street firms,’ that basically have bought these physician practices. And they’re the ones running these ads.”

According to the most recently available campaign finance reports, executives at these firms have directly contributed a total of $57,500 to Cassidy; that’s in addition to the $320,000 they spent to run television commercials in Louisiana thanking Bill Cassidy for his hard work on their behalf.

Click to zoom in.

An Endnote on the Origin of “Double Bill”:

Six years ago, after a blogger in New Orleans forwarded me a trove of documents detailing Cassidy’s unusual employment arrangement with Louisiana State University, I published a series of articles on CenLamar, the blog I operated from 2006 to 2017, and in the process, I coined a new nickname for the Baton Rouge Republican: “Double Bill.”

It was a nod to “Dollar Bill” Jefferson, the disgraced congressman from New Orleans, and a tidy way of explaining what the trove of documents revealed: LSU had been paying Cassidy for work he had either failed to report or had misreported. As a consequence of my reporting, LSU announced it would be conducting an internal investigation into Cassidy’s billing practices, but perhaps unsurprisingly, after Cassidy defeated Mary Landrieu, the three-term Democratic incumbent, the school determined that while “Dr. Cassidy’s work was not adequately documented,” he nonetheless deserved the compensation it had already provided to him.

LSU pulled the report offline, but don’t worry. I saved a copy for y’all.

Download LSU’s Final Report here.

Previous articleToo Much Is On The Ballot
Next articleTheater of the Absurd: How A Louisiana Extremist Helped the Trump Campaign Manufacture Outrage
Lamar White, Jr.
Lamar writes about the people, the politics, and the magic of Louisiana. He is the founder and publisher of the Bayou Brief and a contributing writer for the Daily Beast. Lamar is best known for his investigative reporting on public corruption, racism, and civil rights. He has appeared as a guest on CNN, MSNBC, and the BBC, and he's been the subject of profiles in The Washington Post, The Advocate, and Huffington Post. Before launching the Bayou Brief, he published CenLamar, a popular blog that initially covered the drama of City Hall in his hometown of Alexandria. Lamar is a graduate of Rice University in Houston and the Dedman School of Law at Southern Methodist University in Dallas. Today he lives in New Orleans and is currently writing a book about the life of reputed New Orleans Mafia boss Carlos Marcello.