Big Pharma Front Group Sues Big Tobacco

The United Seniors Association, which portrays itself as a champion of senior citizens, is actually an inside-the-Beltway conservative lobby shop set up by right-wing direct mail guru Richard Viguerie more than a decade ago and currently run by Charles Jarvis, a long-time Republican operative. In the past ten years, it has fought hard to defeat the Clinton health care plan, derail cost-controls on the Medicare prescription drug benefit and lobbied for privatization of Social Security. During election seasons, the pharmaceutical industry floods United Seniors' coffers with funds so the group can run ads for Republican candidates running in hotly contested districts.

Yesterday, Jarvis and USA filed suit against the tobacco industry for running up Medicare’s health care costs. Jarvis used a provision in the 2003 Medicare Modernization Act that I previously was unaware of. This provision, inserted in the law by Sen. Charles Grassley (R-IA), for whom Jarvis once worked, extended of the Civil War-era qui tam statutes (which allows citizens to file suit against contractors who defraud the government) to Medicare. If the suit stands, and Medicare recovers money the way the state suits against Big Tobacco won $200 billion for health care costs incurred by state Medicaid programs, Jarvis’ group stands to win anywhere from one-third to one-half of the settlement. In his press release, he said he hopes to recover $60 billion – that billion with a “b” – for Medicare.

The implication of this is stunning. If this suit is eventually joined by the government and there is a settlement – as happened with the state suits, instead of all the recovered money going back to the federal government to help defray the health care costs of elderly former smokers with emphysema and lung cancer, a substantial fraction will go to a conservative front group that includes the pharmaceutical industry among its major clients.

I have only one question: Why didn’t some progressive group fighting for universal health care think of this?

Meanwhile, the Wall Street Journal reports the suit may have a rocky road ahead of it. A similar Florida suit was dismissed last week when the judge ruled that there had been no finding of liability against the tobacco firms. Since the state Medicaid settlements in 1998, individual suits against Big Tobacco have fallen by 60 percent. The federal government is also pursuing civil racketeering charges against the industry, so far without much success.

Sen. Grassley is cheering on Jarvis and United Seniors. “I hope the courts will accept the statute as an effective tool against undeserved Medicare expenses,” his office said in a prepared statement.