Nonprofit tied to insurance, drug giants behind healthcare overhaul ads

Introduction

If you thought Election Day marked the end of political ads clogging up your television and web browser, think again.

Here come the issue ads.

As a newly inaugurated President Donald Trump and a freshly elected Congress turn to governing, politically active groups want to influence the debate.

Leading the way: nonprofit American Action Network, which this month launched a series of television and digital ads promoting House Republican efforts to overhaul health care.

The ads, which are running in both English and Spanish, feature a voiceover set against a montage of images. There are people jogging. A toddler plays on a playground. Patients confer with their doctors.

“Imagine a new path forward,” intones an off-screen voice that goes on to describe a health care system that provides “more choices and better care,” “puts patients and doctors in charge” and encourages new cures “by eliminating senseless regulations.”

House Republicans, it promises, have a plan that will do those things without disrupting existing coverage. The ad directs viewers to a website paid for by the American Action Network.

Who’s behind it?

American Action Network describes itself as an “action tank” with a mission to promote “center-right policies based on the principles of freedom, limited government, American exceptionalism and strong national security.”

The group has close ties to House Republicans. It was founded in 2010 by former Republican Sen. Norm Coleman of Minnesota and major GOP donor Fred Malek. The current board includes both men, as well as former Republican Reps. Vin Weber of Minnesota and Tom Reynolds of New York, among others.

American Action Network is affiliated with a super PAC, the Congressional Leadership Fund. Both groups share the same leader: Corry Bliss, a former Republican political operative who most recently ran the re-election campaign of Republican Sen. Rob Portman of Ohio and began his job with American Action Network and the Congressional Leadership Fund earlier this month.

Money in

American Action Network is a nonprofit organized under Section 501(c)(4) of the federal tax code, which means its primary mission must be the promotion of social welfare, not politics. Such nonprofits don’t have to reveal their donors.

Nonetheless, some information about American Action Network’s donors has trickled out over the years. Several of the publicly identified donors have to do with health care, including the Pharmaceutical Research and Manufacturers of America, a trade group; insurance company Aetna; and the Alliance for Quality Nursing Home Care. A longer list is available via the Center for Responsive Politics.

According to the group’s most recent tax filing, it took in $26.4 million total between July 1, 2014, and June 30, 2015 — a period that includes the 2014 midterm elections.

Money out

According to an American Action Network press release, the group is spending at least $1.4 million on this latest TV and digital ad campaign. The group said it is running some national ads, but also targeting a series of House districts held by Republican incumbents.

The Spanish-language ads are running on Univision and Telemundo, targeting “six key congressional districts with significant Hispanic populations,” American Action Network said.

American Action Network spent nearly $5.6 million on the 2016 elections, according to filings with the Federal Election Commission. Since politics cannot be the primary purpose of a nonprofit social welfare group, such direct spending on supporting or opposing political candidates cannot constitute the bulk of a group’s spending.

Issue ads, such as the healthcare ads the group announced this month, do not typically count as political spending under Internal Revenue Service rules.

Why it matters

Republicans have promised to repeal the Affordable Care Act, the health care overhaul frequently referred to as Obamacare.

But the issue is fraught, and Trump, House Republicans and Senate Republicans haven’t yet agreed on how best to proceed.

The challenges, meanwhile, are significant.

Republicans have disagreed over whether to repeal parts of the Affordable Care Act immediately, even if a replacement plan is not ready at the same time.

A recent analysis by the nonpartisan Congressional Budget Office found 18 million people could lose health coverage in the first year if Congress repeals the law without replacing it. Trump, meanwhile, has said his plan is almost ready. It will offer insurance for everyone, Trump said.