How Much Money do Insurance Companies Spend so the Laws Keep Them Rich (and Make Them Richer)?

Large corporations hire full time employees to go to Washington D.C. and attend every political event/hearing/meeting they can, with the hopes to influence the politicians who are writing our laws and regulations (in their favor, of course). These dedicated employees/spies/salesman are called Lobbyists.

In the United States, lobbying began here, in the the Willard Hotel lobby. So which came first – the lobby or the lobbyist?

There is a lot of debate about whether lobbying is fundamentally ethical, and some countries have severely resticted the activity (i.e. In the Netherlands a former government official cannot become a lobbyist and then lobby his previous government office.).

Lobbying is Big $ Business

Whether you think lobbying is a good idea or not, what is most concerning about lobbying is that all the money spent on lobbyists has the potential to taint and corrupt what might have started out as a neutral and noble concept (Isn’t that the truth with almost anything in life?). In the insurance industry alone, about $153 MILLION dollars was spent in 2016 to lobby government officials.

Should they Really Spend THAT Much Money?

Blue Cross/Blue Shield spent $19 Million just on their own, which when you think about the current status of Obamacare and potential reform to the American medical insurance markets which remains at stake, it isn’t a surprise. But isn’t that also more than a little annoying? I mean, these large insurance corporations are constantly telling us that they have sooo many expenses, so in order to keep our premium costs low, they don’t want to be approving too many claims or spending too much money, and then they turn around and spend $19 MILLION DOLLARS in ONE YEAR on their advocates in Washington D.C.

Think about that for a minute. NINETEEN MILLION DOLLARS. That could provide a lot of medical care for a whole lot of people (even at the current ridiculously high prices in the U.S.). And what exactly are they spending that exhorbitant sum on? You could fund an entire year’s salary for thousands of lawyers to plague every government representative, their staff, and even their mailmen. Is all that really necessary?

But maybe it is. It brings to mind the old adage heard from elders when they know someone has been up to no good, and yet that same someone is the loudest screamer when it’s time for reconciliation “Thou dost protest too much.”

What Are They Lobbying For?

Make no mistake, insurance company lobbyists are not spending all that money nobly advocating for better insurance coverage and lower premiums for Americans, they are advocating to keep their very profitable bottom line and protect their shareholders’ profits. 

If this feels troubling to you as an insurance policyholder, but you can’t quite pinpoint why – let me help you see it more clearly.

Insurance Companies Have a Deeply Troubling Conflict of Interest

The God Janus: Two-Faced
Two-Faced Roman God Janus – Is he double-dealing? (Credit Wikipedia)

In the last few hundreds years, there was a shift away from the concept of insurance provided to actually HELP people in their time of need, and toward insurance as a big money-making industry where profit rules and the shareholder is king. Today, American insurance companies spend millions upon millions on splashy advertising meant to convince you they are trustworthy, and then behind your back they spend millions upon millions of your premium dollars on lobbyists who convince YOUR government representatives that they should not enact laws to protect you from bad insurance company behavior.  It’s a masterful act of double-dealing, caused by the troubling conflict of interest a for-profit insurance company has between service to its policyholders and making profits for its shareholders. They only thing that protects you from this conflict is the LAW. And yet, your own insurance company is lobbying to keep those laws from being written.

Typically, lobbying is not an inherently bad activity, as long as certain ethical rules are followed. In the insurance industry, it’s deeply problematic.

To see the full list of monies spent by insurance companies, and see where your insurer stands in the rankings, go to

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s