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Special Report
The strategy of powerful Catholic health care advocates in the debate over reform has left many confused.
By Anne Hendershott
 The battle over health care reform promises to be the most expensive one ever waged in Congress, as armies of lobbyists advance on Washington to demand that new legislation reflect their interests. Recognizing the high stakes involved, hospitals, drug companies, unions, and a host of health care providers ranging from medical device makers to Planned Parenthood have spent nearly $400 million on lobbying. All have a vested interest in “fixing” health care to their advantage.
One of the most visible activists involved in shaping health care reform is Sr. Carol Keehan, president of the Catholic Health Association (CHA), an advocacy organization that represents the interests of Catholic hospitals and large Catholic health care organizations throughout the country. Catholic hospitals and health care facilities pay dues to the CHA, whose stated mission is “to promote the Catholic Church’s ministry in health care and to respond to the members’ need to practice quality health care in the communities where they serve.”
In an attempt to fulfill this mission, Sr. Keehan has been out on the front lines advocating for health care reform from the earliest days of the Obama administration. On what side of the debate Sr. Keehan’s CHA falls, however, has been unclear and a source of concern given that all reform proposals before November permitted an expansion of abortion rights.
Throughout the summer of 2009, the CHA created confusion by issuing unclear communications and producing videos that appeared to many people to be supportive of the president’s health care plans.
The CHA’s communications were so unclear that throughout the month of August, most media outlets reported that the CHA unequivocally supported President Obama’s health care plan. David D. Kirkpatrick, a New York Times reporter, was so convinced that the CHA and Catholic Charities USA strongly supported the president’s health plan that he published an article on August 28 declaring just that. Although the New York Times corrected that article on its website on August 29, claiming that its reporter “overstated the support of Catholic Charities and the Catholic Health Association for the president’s plans,” the Times maintains in the revised article that “both organizations have supported his [the president’s] overall approach.”
Much of the media confusion began on June 17 when the CHA posted a video on their homepage entitled “I Can’t Wait…for Health Reform.” The video, produced by the CHA, opens with a film clip of President Obama giving a speech in which he declares: “Let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year.” This clip is followed by pictures of dozens of individuals—some of them nuns and priests—holding up signs calling for health care reform. Each of the signs echoes President Obama’s “I Can’t Wait” rhetoric, and each adds a distinctive tag line, like “I can’t wait for health care for my baby” or “I can’t wait for health care for our patients.” The video concludes with the statement “Now is the time to create a health care system that works for everyone. Because we the people can’t wait.”
 It is not unreasonable for someone viewing the video to conclude that the CHA supports President Obama’s health care plan. This conclusion is strengthened by the fact that just a few weeks after the release of the video, the CHA joined Catholic Charities USA and the Society of St. Vincent de Paul to issue an “action alert” urging constituents to tell their legislators to “pass health care legislation now.” The directive from the three organizations stated: “Please call and email your representative in the next 24 hours expressing your support for Congress to enact health care reform now.” These Catholic organizations, like President Obama’s Democratic supporters, wanted to encourage lawmakers to pass health care reform before Congress’ summer recess.
Catholic Charities USA also linked to the CHA’s “I Can’t Wait” video on its homepage—implying its own organizational support for the current health care plans. In one clip in the video features a large group of individuals wearing purple t-shirts with the Society of St. Vincent de Paul logo—implying the support for the president’s health care reform from the employees or friends of St. Vincent’s. While one of the dozens of signs in the video is held by a Catholic bishop and carries the tag line “I can’t wait for health care that respects life,” there are no qualifiers or disclaimers anywhere in the video indicating that the CHA only supports health care reform if there is an amendment that would prevent the provision of abortion services. The message seemed clear to many viewers, including, presumably, the New York Times reporter: the Catholic Health Association supports the president’s health care reform—in spite of the fact that the president’s health care reform continues to include an expansion of abortion services.
CAN THEY WAIT?
Despite the support for abortion within every version of the health care plan up until that point, in July a Catholic World News report broke the news of a letter issued by Catholic Charities president Father Larry Snyder urging Congress to enact health care reform. A week later, in response to media queries about the Catholic Health Association’s stance on the health care bill, the CHA issued a statement that read: “Catholic Health Association has written letters to members of Congress and to the White House—often in conjunction with the United States Conference of Catholic Bishops—calling for legislation that does not include an expansion of abortion.”
The carefully chosen phrase “no expansion of abortion” can be viewed by reasonable readers as an “abortion neutral” stance by the CHA. Sr. Keehan stated in an interview broadcast on EWTN that the CHA was not “abortion neutral,” but the confusion from this earlier letter continues.
As President Obama’s health care reform plans continued to meet angry resistance from citizens at town hall meetings throughout the summer, many lawmakers, both Democratic and Republican, became increasingly reluctant to support a health care plan that their own constituents condemned. As the most recent CNN poll indicates, voters throughout the country are becoming increasingly pro-life, and, in turn, lawmakers are beginning to be sensitive to the changing opinions on abortion rights and abortion subsidies.
On September 9, in an attempt to allay fears and gain support for his health care plan, President Obama, while addressing a joint session of Congress, tried to reassure all that “no federal funds will be used for abortion.” On September 10, the CHA produced yet another puzzling video that appeared to support the president’s plan.
In it, Sr. Keehan speaks directly into the camera to say that as she looked at the growing rates of poverty in our country, “I could not help but think of the speech I heard from President Obama last night while sitting in the House Chamber, on how important health reform is for our economy, not just for the poor, but for our middle class, and for our businesses.” She added, “I was so heartened to hear our president say that no federal funds will be used for abortion.”
But why is she “heartened” by it? The claim is specious. As Cardinal Justin Rigali, chairman of the USCCB Committee on Pro-Life Activities, wrote in an August 11 letter to Congress addressing defects in the “America’s Affordable Health Choices Act,” funds authorized by this legislation would still be eligible to cover abortion since the Hyde Amendment—which bans federal financing of abortion—is not applicable to it. Also, he wrote, the funds authorized by the legislation are “fungible” and “will subsidize the operating budget and provider networks that expand access to abortions.”
ATTENTION TO THEIR BOTTOM LINE
When Sr. Keehan’s video statement cited the importance of health care reform “to businesses,” she may have been referring in part to the health care businesses she represents—the interests of Catholic hospitals and large Catholic health care organizations and long-term care facilities throughout the country. As their representative (these hospitals pay annual dues to the Catholic Health Association for this representation), Sr. Keehan joins the more than 3,000 health care reform lobbyists on the Hill—each promoting an agenda that will benefit their employers.
Jennifer Liberto, senior writer at CNNMoney.com, claims that “the bill for lobbyists, television ads, and political donations has topped $375 million—enough to pay for the entire [health] insurance costs for more than 30,000 families a year.” According to the Center for Responsive Politics, $280 million has gone to direct lobbying of lawmakers and other policymakers. Bloomberg News recently calculated that throughout the summer and early fall of 2009, there were at least six health care lobbyists for each member of Congress.
Throughout the months leading up to the congressional votes on health care reform, the Wall Street Journal reported that by 7:30 each morning, lobbyists began lining up in the hallway outside the offices of Senator Max Baucus, a Montana Democrat who heads the Senate Finance Committee that is helping craft the legislation. Baucus claims to have received so many requests for meetings with lobbyists that he had to use interns to conduct some of them—”and the office is taking Saturday bookings.”
This flurry of lobbyist activity should surprise no one—there are billions of dollars for health care organizations at stake in health care reform. And although Catholic hospitals and Catholic long-term care facilities were created to serve the poor, and most of them do a fine job of doing so, the Wall Street Journal revealed recently that some non-profit Catholic health care organizations have become very lucrative.
In 2008, the Journal published a series on the transformation of non-profit hospitals into what the series’ reporters called “profit machines.” The Journal pointed out that “Ascension Health, a Catholic non-profit health care system that runs 65 hospitals, mostly in the Midwest and Northeast, reported net income of $1.2 billion in its fiscal year ending June 30, 2007, and cash and investments of $7.4 billion…more than many large publicly traded companies…more cash than Walt Disney Co. has.”
Some of the top executives at CHA’s member institutions—the Catholic hospital presidents and chief executive officers of Catholic health care organizations—are among the highest paid hospital administrators in the country, and some of them sit on CHA’s board. Lloyd Dean, the CEO of Catholic Healthcare West, became chair of the CHA in the spring of 2008. In 2006, Dean received a salary of $5.3 million from Catholic Healthcare West, a hospital system based in San Francisco. Dean’s salary included the forgiveness of Dean’s $782,541 housing loan. According to Healthcare West, Dean’s compensation “reflects his skill in turning the hospital system around financially.”
The Wall Street Journal asserts that one reason for non-profit hospitals’ soaring profits is a gradual increase in Medicare reimbursements after federal budget cutbacks during the 1990s. By merging and gaining scale, many non-profit hospitals also gained leverage in price negotiations with health insurers. While no one is claiming that non-profit Catholic hospitals are not fulfilling their obligation to the poor, the Wall Street Journal maintains that many non-profits can attribute their profits to “demanding upfront payments from patients, hiking list prices for procedures and services to several times their actual costs, selling patients’ debts to collection companies, focusing on expensive procedures, and issuing tax exempt bonds and investing the proceeds in higher yielding securities.” All of these activities are untaxed.
WHO STANDS TO GAIN?
These hospitals have much to gain by helping to pass President Obama’s health care reform. On September 8, 2009, Lloyd Dean’s Catholic Healthcare West unveiled a multi-faceted campaign entitled “September for Reform” which marshaled its significant resources to support the president’s health care reform. The campaign featured a new video highlighting the organization’s highly successful health care town hall meetings. On its blog, Catholic Healthcare West touted the “tone” of these town hall meetings as “standing in stark contrast to the town halls that were covered in the news.” It invited visitors to the blog to look at a video of the Catholic Healthcare West town hall meetings where “more than 750 people of all ages came together to talk about the changes they hoped to see in a reformed system.”
In addition to its videos and health care blog, Catholic Healthcare West launched a new advertising campaign to run in major US media publications (including the Washington Post, the Washington Times, The Hill, Roll Call, and the Wall Street Journal). It has also implemented a congressional outreach program for the fall legislative session. In a press release, Dean stated, “Put simply, the time is now for making American health care better.”
All of this would indeed be in keeping with increasing access to health care for the poor—if the reform respected life issues. But concerns about abortion or end-of-life care issues are not mentioned. A June 17, 2009 Catholic Healthcare West blog entry says: “We have been longtime supporters of health care reform. We took our first official position in support of universal access in 1992 and in 2003 we established four principles for reform: universal access, stable financing, and improved quality and accountability.” Catholics might be discouraged to find that respect for life from conception to natural death is not included in these four principles for reform.
Following President Obama’s September 9 speech to the Joint Session of Congress, Reuters carried a press release issued by Lloyd Dean which stated, “At Catholic Healthcare West, we live every day with the challenges President Obama outlined in his speech tonight—we see the real life effects of our broken health are system…. America needs a reform plan that controls costs and provides basic health care for people in the country who don’t have it.”
Perhaps a second look at executive compensation of more than $5 million per year might be warranted as one way of controlling costs in health care. But then, Dean is not alone in receiving what most readers might conclude is a generous salary. According to the Wall Street Journal, Ascension Health paid its CEO an annual salary of $3.3 million.
Like lobbyists on Capitol Hill, advocates representing Catholic hospitals in the health care reform debate are also paid well. Although Sr. Keehan’s $856,093 salary in 2006 (up from $654,915 in 2005) was paid directly to her religious order, according to the CHA’s 2007 IRS 990 report, several key employees at her organization received salaries of more than $300,000. Michael Rodgers, senior VP of advocacy, was paid $316,806 in 2006. Lisa Gilden, general counsel, was paid $325,206. Rhonda Mueller, VP of finance, was paid $268,873, and even Fred Caesar, Sr. Keehan’s “special assistant,” made $198,212 in 2006.
These health care reform advocates know that the single biggest variable for non-profit hospitals is how well insured the patient population is. They depend on high charges for health care services to those with insurance to cover those who cannot afford to pay.
Effective business strategies and mega-mergers have created so much wealth for many of these large Catholic health care organizations that, in 2008, Senator Charles Grassley (R-Iowa) threatened to introduce legislation forcing non-profit hospitals to provide a minimum amount of charity care to keep their tax-exempt status. Alleging that non-profit hospitals receive $40 billion in benefits through their exemptions from income, sales, and property taxes, tax-deductible contributions, and tax exempt bonds, Grassley noted the profits that these non-profits were making and became concerned. But with a new presidential administration and a deepening recession, the focus has shifted away from such concerns.
Most faithful Catholics support Catholic hospitals and health care facilities. They are grateful that Catholic hospitals are committed to increasing access to care for the poor. But they do expect that advocates for Catholic hospitals like Sr. Keehan remain faithful to the Church’s mission of protecting the unborn, the elderly, and those who cannot speak for themselves—a commitment that the murky strategy of the Catholic Health Association calls into question.
Anne Hendershott is Chair of the Politics, Philosophy and Economics Program at The King’s College in New York City. She is the author of The Politics of Abortion (Encounter Books).
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