Blue Dog Mike Ross Flips Healthcare Debate Into Dirty Real Estate Deal
Flip-Flopping Ross Made Big Profits Off of Questionable Real Estate Deal with Buyer Who has “Keen Interest in How the Debate Plays Out”
SPIN CYCLE: Mike Ross Has Been Hesitant on Dems Healthcare Overhaul
“While I remain opposed to a government-run public option, I believe this health care co-op is an idea worth serious consideration,” Ross wrote in a newsletter to constituents. “As long as the idea is deficit-neutral, I believe it is one worth exploring because we must do something about the rising costs of health insurance before any more hard-working Arkansans lose their job or their coverage through no fault of their own.” (Michael O’Brien, “Baucus healthcare bill ‘worth serious consideration,’ says Rep. Mike Ross,” Roll Call, 9/21/2009
RINSE CYCLE: But Did He Turn His Insider Status Into A Lucrative Property Sale?
“Arkansas Rep. Mike Ross — a Blue Dog Democrat playing a key role in the health care debate — sold a piece of commercial property in 2007 for substantially more than a county assessment and an independent appraisal say it was worth.
The buyer: an Arkansas-based pharmacy chain with a keen interest in how the debate plays out.
Ross sold Holly’s Health Mart in Prescott, Ark., to USA Drug for $420,000 — an eye-popping price for real estate in a tiny train and lumber town about 100 miles southwest of Little Rock.
“You can buy half the town for $420,000,” said Adam Guthrie, chairman of the county Board of Equalization and the only licensed real estate appraiser in Prescott.
But the $420,000 that USA Drug paid for the pharmacy’s building and land was just the beginning of what Ross and his wife, Holly, made from the sale of Holly’s Health Mart. USA Drug owner Stephen L. LaFrance Sr. also paid the Rosses $500,000 to $1 million for the pharmacy’s assets and paid Holly Ross an additional $100,000 to $250,000 for signing a noncompete agreement. Those numbers, which Mike Ross listed on the financial disclosure reports he files as a member of Congress, bring the total value of the transaction to between $1 million and $1.67 million.And that’s not counting the $2,300 campaign contribution Ross received from LaFrance two weeks after the sale closed.
The pharmacy industry is aggressively lobbying Congress in an effort to protect its interests in the health care debate. Ross, who belongs to the 52-member Congressional Community Pharmacy Coalition, has introduced and supported legislation backed by pharmacy trade groups.
On Aug. 1, the National Community Pharmacist Association issued a news release thanking Ross for an amendment to the health care reform bill that would create greater transparency in the operations of pharmacy benefit managers, who act as clearinghouses for insurance company reimbursements for pharmaceuticals.
In June the National Association of Chain Drug Stores issued a news release thanking Ross for introducing legislation authorizing payments to pharmacists to train patients in how to manage their medications.
Health-related interests have donated $342,475 to Ross since 2007, according to federal campaign data maintained by the nonprofit Center for Responsive Politics. No other business sector has given Ross as much.
Two months after the 2007 sale, LaFrance’s concerns about health care reform were spelled out in an article in the Arkansas Democrat-Gazette.
“Universal health care will ruin our health care in America,” LaFrance told the reporter. “There’ll be long lines, they won’t be able to get treated, potential doctors will be afraid to go into medical school, there will be an outflux of doctors — in my opinion. It’s not broke, and don’t fix it.”
Describing the drug industry as “very big business,” he said the high prices charged for prescription drugs are possible only because insurance companies and the government underwrite about 95 percent of the cost.
“So when the customer pays $7, $10, $15, $20 [for a prescription co-pay], it doesn’t hurt him. They don’t realize that the insurance company is paying the other $125. That’s kind of a double-edged sword; if it wasn’t for insurance, the American pharmaceutical industry wouldn’t be able to charge the prices it charges today, because the public wouldn’t put up with it,” LaFrance told the Democrat-Gazette.
“Our sales are higher because it affects the top line of sales,” he added. If the government doesn’t interfere, there are “nothing but good days ahead.” (Marcus Stern, “Mike Ross raises eyebrows with healthy haul,” Politico, 9/22/2009)
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