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June 1997 – Blue Cross Flexes Muscle with Campaign Money



On Sunday, June 15, 1997 the Raleigh News & Observer published an analysis of Senate Bill 933, which provides for the terms of Blue Cross’ possible conversion to private ownership. The front-page story, headlined “Big Money Involved in Blue Cross’ Future,” used data from Democracy South to show the connection between Blue Cross campaign donations and legislative votes.

If you would like details of the votes and money, please contact 919-489-1931. Democracy South is a Chapel Hill-based watchdog organization.

Highlights from its tables include:

* The June 9th House vote on Senate Bill 933 closely followed the money legislators received from Blue Cross’ PAC in 1995-96. Every House member who received $350 or more voted with the Blue Cross, except Chuck Neely and Tim Tallent, who did not vote. Among House members who received some Blue Cross money, the YES voters received 27 times what the NO voters got.

* Blue Cross Blue Shield nearly doubled its PAC giving to winning state legislative candidates in the 1996 election. It had given about $24,000 to winners in the 1990, 1992 and 1994 election, but jumped to $48,240 in 1996.

* Blue Cross’ 94% increase from 1994 to 1996 compares with an overall fund-raising increase of 67% by winning legislators and 66% increase in all PAC giving.

* Blue Cross also increased its giving to Council of State candidates and the governor. Jim Hunt received $8000 in his 1996 campaign, compared to $4000 in 1992; Insurance Commissioner Jim Long took in $5600 compared to $3400 in his 1992 campaign; and Dennis Wicker got $1800 in 1996 versus $1250 in 1992.

* Top Republican leaders in the House received among the largest donations Blue Cross gave, and they all supported SB 933. Democratic leaders who favored the Bill also got healthy Blue Cross donations or money from other insurance PACs. The vote breakdown fell less along party lines than money lines.

* House members who received $2000 or more from insurance PACs were 7 times more likely to vote YES than vote NO; those who received nothing were 3 times more likely to vote NO than YES.

* PACs tied to the insurance industry gave more money to winning state legislative candidates ($352,000) than the PACs of any other cohesive interest group — more than bankers or doctors. The health field overall gave more, but its members often are pitted against one another in turf battles.

* Tony Rand, the state senator who pushed Senate Bill 993 through the Senate and continued lobbying for it in the House, received more money from the Blue Cross PAC than any other senator, except Howard Lee who lives in the district of the company’s headquarters and faced a tough race in 1996.

* Tony Rand also received more money from all insurance PACs ($9,300) than any other state senator except Sen. President Pro Tem Marc Basnight ($11,450).

This analysis was prepared by Bob Hall, Research Director of Democracy South on the basis of campaign contribution reports at the NC Board of Elections.