Impact of tobacco industry and other corporations in the defeat of the 1994 Clinton health care plan

Michael Givel

The primary reason cited by many scholars for the defeat of the Clinton Administration's 1994 health care reform bill has long been identified as Health Insurance Association of America and National Federation of Independent Businesses opposition to the bill. Given this predominant consensus combined with sizeable proposed funding for the bill by a large tobacco product tax, this manuscript examined what the tobacco industry's role was in whole or part in defeating the Clinton health care bill. This research occurred through crosschecking internal tobacco industry documents and Clinton White House documents. Prior to the passage of the bill, the tobacco industry accepted a compromise of 45 cents per pack increase phased in over five years. Due to this compromise, the industry or third party allies had no role in the ultimate defeat in the bill. The primary reason for the bill's ultimate defeat was general business (but not tobacco industry and third party ally) opposition, the bill running out of time, and conflicting bills. Secondary reasons for the bill's defeat included issues with: employer mandates, high taxes on insurance plans, impacts on medical research and education, Congressional attention to other issues, election year politics, and possible future excise tax possibilities.