By Wendell Potter on June 24, 2009

Wendell PotterI'm the former insurance industry insider now speaking out about how big for-profit insurers have hijacked our health care system and turned it into a giant ATM for Wall Street investors, and how the industry is using its massive wealth and influence to determine what is (and is not) included in the health care reform legislation members of Congress are now writing.

Although by most measures I had a great career in the insurance industry (four years at Humana and nearly 15 at CIGNA), in recent years I had grown increasingly uncomfortable serving as one of the industry's top PR executives. In addition to my responsibilities at CIGNA, which included serving as the company's chief spokesman to the media on all corporate and financial matters, I also served on a lot of trade association committees and industry-financed coalitions, many of which were essentially front groups for insurers. So I was in a unique position to see not only how Wall Street analysts and investors influence decisions insurance company executives make but also how the industry has carried out behind-the-scenes PR and lobbying campaigns to kill or weaken any health care reform efforts that threatened insurers' profitability.

I also have seen how the industry's practices -- especially those of the for-profit insurers that are under constant pressure from Wall Street to meet their profit expectations -- have contributed to the tragedy of nearly 50 million people being uninsured as well as to the growing number of Americans who, because insurers now require them to pay thousands of dollars out of their own pockets before their coverage kicks in -- are underinsured. An estimated 25 million of us now fall into that category.

What I saw happening over the past few years was a steady movement away from the concept of insurance and toward "individual responsibility," a term used a lot by insurers and their ideological allies. This is playing out as a continuous shifting of the financial burden of health care costs away from insurers and employers and onto the backs of individuals. As a result, more and more sick people are not going to the doctor or picking up their prescriptions because of costs. If they are unfortunate enough to become seriously ill or injured, many people enrolled in these plans find themselves on the hook for such high medical bills that they are losing their homes to foreclosure or being forced into bankruptcy.

As an industry spokesman, I was expected to put a positive spin on this trend that the industry created and euphemistically refers to as "consumerism" and to promote so-called "consumer-driven" health plans. I ultimately reached the point of feeling like a huckster.

I thought I could live with being a well-paid huckster and hang in there a few more years until I could retire. I probably would have if I hadn't made a completely spur-of-the-moment decision a couple of years ago that changed the direction of my life. While visiting my folks in northeast Tennessee where I grew up, I read in the local paper about a health "expedition" being held that weekend a few miles up U.S. 23 in Wise, Va. Doctors, nurses and other medical professionals were volunteering their time to provide free medical care to people who lived in the area. What intrigued me most was that Remote Area Medical, a non-profit group whose original mission was to provide free care to people in remote villages in South America, was organizing the expedition. I decided to check it out.

That 50-mile stretch of U.S. 23, which twists through the mountains where thousands of men have made their living working in the coalmines, turned out to be my "road to Damascus."

Nothing could have prepared me for what I saw when I reached the Wise County Fairgrounds, where the expedition was being held. Hundreds of people had camped out all night in the parking lot to be assured of seeing a doctor or dentist when the gates opened. By the time I got there, long lines of people stretched from every animal stall and tent where the volunteers were treating patients.

That scene was so visually and emotionally stunning it was all I could do to hold back tears. How could it be that citizens of the richest nation in the world were being treated this way?

A couple of weeks later I was boarding a corporate jet to fly from Philadelphia to a meeting in Connecticut. When the flight attendant served my lunch on gold-rimmed china and gave me a gold-plated knife and fork to eat it with, I realized for the first time that someone's insurance premiums were paying for me to travel in such luxury. I also realized that one of the reasons those people in Wise County had to wait in long lines to be treated in animal stalls was because our Wall Street-driven health care system has created one of the most inequitable health care systems on the planet.

Although I quit my job last year, I did not make a final decision to speak out as a former insider until recently when it became clear to me that the insurance industry and its allies (often including drug and medical device makers, business groups and even the American Medical Association) were succeeding in shaping the current debate on health care reform. While the thought of speaking out had crossed my mind during the months leading up to the day I gave notice, I initially decided instead to hang out my shingle as a consultant to small businesses and nonprofit organizations.

I decided to take the shingle down, though, at least for a while, when I heard members of Congress reciting talking points like the ones I used to write to scare people away from real reform. I'll have more to say about that over the coming weeks and months, but, for now, remember this: whenever you hear a politician or pundit use the term "government-run health care" and warn that the creation of a public health insurance option that would compete with private insurers (or heaven forbid, a single-payer system like the one Canada has) will "lead us down the path to socialism," know that the original source of the sound bite most likely was some flack like I used to be.

Bottom line: I ultimately decided the stakes are too high for me to just sit on the sidelines and let the special interests win again. So I have joined forces with thousands of other Americans who are trying to persuade our lawmakers to listen to us for a change, not just to the insurance and drug company executives who are spending millions to shape reform to benefit them and the Wall Street hedge fund managers they are beholden to.

Take it from me, a former insider, who knows what really motivates those folks. You need to know where the hard-earned money you pay in health insurance premiums -- if you lucky enough to have coverage at all -- really goes.

I decided to speak out knowing that some people will not like what I have to say and will do all they can to discredit me. In anticipation of that, here are some facts:

  • I am not doing this because my former employer was pushing me out the door or because I had become a disgruntled employee. I had not been passed over for a promotion or anything like that. As I noted earlier, I had a financially rewarding career in the industry, and I'm very grateful for that. I had numerous promotions, raises, bonuses, stock options and stock grants over the years. When I left my last job, I was as close on the corporate ladder to the CEO as any PR person has ever climbed at the company. I reported to the general counsel, the company's top lawyer, whose boss is the chairman and CEO, a man I like and worked closely with over many years.
  • The decision to leave was entirely my own, and I left on good terms with everybody at the company. In fact, I agreed to postpone my last day at work by more than two months at the company's request. My coworkers gave me a terrific going-away party, and I received dozens of kind notes from people all across the country including friends at other companies and at America's Health Insurance Plans, the industry trade association.

I still consider all of them my friends. In fact, the thing I have missed most since I left is working as part of a team, even though I eventually came to the conclusion that I was playing for the wrong side. Being a consultant has its advantages, but I have missed the camaraderie. After a few months, I thought that maybe I should consider working for another company again. At one point, a former boss told me that another insurer had posted a PR job and encouraged me to contact a former CIGNA executive who worked there about it. Against my better judgment, I did, but I immediately decided not to pursue it. The last thing I wanted to do was to go from one big insurer to another one. What the hell was I thinking?

I'm writing this because, knowing how things work, I'm fully expecting insurers' PR firms to quietly feed friends of the industry (which include a roster of editorial writers and pundits, lawmakers and many others who fall under the broad category of "third-party advocates,") with anything they can think of to discredit me and what I say. This will go on behind the scenes because the insurers will want to preserve the image they are working so hard to cultivate -- as a group of kind and caring folks who think only of you and your health and are working hard as real partners to Congress and the White House to find "a uniquely American solution" to what ails our system.

I expect this because I have worked closely with the industry's PR firms over many years whenever the insurers were being threatened with bad publicity, litigation or legislation that might hinder profits.

One of the reasons I chose to become affiliated with the Center for Media and Democracy is because of the important work the organization does to expose often devious, dishonest and unethical PR practices that further the self interests of big corporations and special interest groups at the expense of the American people and the democratic principles this country was founded on.

After a long career in PR, I am looking forward to providing an insider's perspective as a senior fellow at CMD, and I am very grateful for the opportunity to speak out for the rights and dignity of ordinary people. The people of Wise County and every county deserve much better than to be left behind to suffer or die ahead of their time due to Wall Street's efforts to keep our government from ensuring that all Americans have real access to first-class health care.


Wendell Potter is the Senior Fellow on Health Care for the Center for Media and Democracy in Madison, Wisconsin.

Wendell Potter

Wendell Potter is CMD's honorary Senior Fellow on Health Care (since May 2009). He writes a regular column for the Center for Public Integrity.

Comments

Fellow North Americans:

Please, do not be sucked in by the rhetorical verbiage that suggests publicly-funded health care is bad for your health because it looks like 'socialism'.

Publicly-funded health care in Canada is no more socialist than a medical insurance plan in the U.S.A. underwritten by any insurance company and provided as a partially paid benefit by your employer or a union that you may happen to belong to.

Employee or union plans are 'collective' plans, in that you are entitled to the plan's benefits only if you are part of the collective, abide by its conditions, and pay the premiums associated with it. A publicly-funded health care plan for all those Americans that are not covered by employer or union-subsidized plans, or those who cannot afford to purchase health care insurance out of their own personal incomes, is no different in that it provides coverage to a collective (group of people), albeit a larger one currently estimated to be around 46 million or so Americans.

Any references about Canada's publicly-funded system being dysfunctional, not successful or not taking good care of Canadians is pure fallacy perpetuated by those who gain from keeping the status quo in the U.S. I am a Canadian who has had nothing but the best of health care services for 61 years.

In Ontario, where I live, our Provincial government provides more than 80% of the capital funding for new hospital construction and major equipment like cat scan units. Hospitals are incorporated as individual non-profit business units. Operational direction is provided by each hospital corporation's Board of Governors, all chosen from and elected from within the community served by it. Operation of all medical services is governed by the Ontario Health Act. The same general relationships apply in all of Canada's provinces and territories.

Doctors, for the most part, are self-employed, either as members of a group practice (a business unit, usually incorporated like any other business) that runs its own clinic within owned or leased premises. Doctors, like dentists, opticians or other licensed medical professionals, are free to purchase and operate their own equipment, even a large can-scan machine if they wish.

All hospitals, and doctors in medical clinics, bill the Ontario Health Insurance Plan (OHIP) for qualifying procedures. OHIP pays by invoice, for the procedures performed, according to a fee schedule that contains the fees paid for all qualifying procedures. This is no different in the U.S., where privately-operated hospitals and doctors send their invoices to the insurance companies for payment.

My family is covered by an employee-based group health benefits insurance plan, underwritten by a private insurer. The company pays 3/4 of the monthly premium and I pay the other quarter as a salary deduction. All dental procedures are covered up to 90% by the plan for all of my family members. I pay the invoices up front, the dental office sends in the claim over the internet, and the check arrives in the mail within 7 days, no questions asked.

Although visits to the optometrist are not covered under OHIP (in Ontario) so we pay for these out of our own pockets. However, OHIP does pay optometrist invoices for diabetics. I am most appreciative of this benefit since I was recently diagnosed with type 2 diabetes.

What happens if I need an ambulance in an emergency? Ambulance services are generally operated by private-sector firms who provide services under contract to local or regional health services coordination organizations, either a regional hospital, a district health unit (DHU) or, in some cases, a municipality. When I dial 911 in my community, a dispatch call goes out to my local municipality's volunteer Fire and Emergency Services unit, and they are usually the first to respond with emergency assistance within 5 minutes or less. At the same time, a dispatch call also goes out to our regional Emergency Medical Services (EMS) centre which also dispatches an ambulance to the scene. Both the local and regional organizations work together. I've needed an ambulance three times in my life and, each time, I've never received a bill for the trip to the hospital.

When I visit my local medical clinic for a doctor's appointment, or use any hospital services, I am always required to present my OHIP card to verify that I am covered under the Ontario Health Insurance Plan (OHIP). I assume everyone in the U.S. must do the same, by providing their respective Insurance Plan Membership card to verify coverage.

In effect, our Ontario Health Insurance Plan is no different than any health insurance plan provided by insurance companies. The only difference is that it is operated by the Province. Health services covered by OHIP are not free. Instead of collecting huge monthly premiums from every plan member as an insurance company does, the OHIP system gets its revenue from only a few sources; a portion comes out of the personal income tax we pay to the Province, a good portion comes from the Ontario Lottery & Gaming Commission's revenue (a provincially-owned crown corporation), some from federal transfer payments to the province, and some is provided by employers who contribute according to a pre-determined formula set by the Province.

Does any of this interfere with or take away my right to make my own choices in life? Absolutely not. I have the freedom to use the OHIP system as I automatically become a 'plan member' by virtue of the fact that I am a Canadian citizen and have lived and worked in the Province of Ontario for all of my life. If I want more coverage than OHIP provides, I am free to purchase additional health insurance from any number of insurance companies. Either way, I am also free to choose which doctor I see or which clinic or hospital I walk into anywhere in Ontario.

I can even choose to travel south to the U.S. and purchase medical services from a U.S. hospital or doctor with my Visa card, though I can't imagine why. A new $500 million hospital is almost completed in my area, to replace two aging facilities, and will have the best of new technologies, equipment and medical expertise in all departments. Surgeries can already be handled by remote control units by specialist surgeons in other large urban centres as well. It's just 20 minutes from where I live.

Either way, neither the Ontario or Canadian government have any influence over my decisions. If anyone tells you any different, don't believe it.

Yours Truly,
A Healthy, Free (Ontario) Canadian

You

It takes some serious cojones to do what you are doing. I got so excited that you were on our side. The kicker of it is that you are so believable. I love it.

who was the no broken windows executive when I worked at CIGNA? I worked for Behavioral Health. Most of us scattered. We know about the crooked health care systems and I could not tolerate it anymore. I quit and went into a small business of my own. Of course I cannot afford Health Insurance.

Basically what I got of 14 years working for CIGNA and PacifiCare was that rewards and accolades were given for denial of service. When I was forced to put suicidal people on hold I had to leave.

I just want to say THANK YOU Mr. Potter on behalf of me and the rest of Americans who wish for healthcare reform. Thank you for coming out and speaking the truth about what most people don't know. I'm sure Senator Kennedy would be very proud of you.

I would applaud you, but I know you're not seeking that kind of attention, so I won't. There is no shame or blame in the "American Dream." After all, this is the land of opportunity. Evolution being what it is I think it's safe to say, though, that we are now the land of the opportunists.

My mother was 4 months into chemotherapy treatment when she went to the pharmacist to discover that her perscription plan was dropped. Unable to afford the medication out of pocket, she left. It took a week for her insurer to admit their error and get reinstated. Within a week after restarting her medication she caught pneumonia. She was in the hospital for a week, released, and died within 48 hours.

She was on Medicaid,... our countries last resort for insurance. So don't feel that private insurance companies are the only one's with tricks up their sleeves.

Dear Mr. Potter,
Thank you!
I would like to say that I am currently employed and insured by CIGNA. I tore my ACL a few months ago and they have covered everything from the ambulance ride to the orthopedist and physical therapy twice a week. I am ever so grateful to have this. But . . . my job is probably going to be outsourced (another American disgrace)sooner than later. What will I do then? Who knows?
It's embarrassing to live in the most prosperous nation on the planet and have so many good, hard-working people forced to stand in line to get health care in a livestock stall.
I am grateful to you for speaking out and working on correcting the health care system of this great nation of ours.
Sleep well!
Regards,
Barbara Norris

Real or not? Seems genuine to me although seeing his face in the big screen of corporate media news would add credibility. I would like to see and hear more from Mr. Potter. I would like to add that; the “Insurance Industrial Complex” really only aggregates the dollars of the members and skims off the top for their pay and stock holder payments. What they have done to launch them into the sights of reform is to gut the system of benefits to a level of third world, making their offering a virtual joke. These guys are greedy beyond belief and have no idea of stewardship or community. I would put them in the category of sociopaths. What we should do is institute total regulation! Down to the cost of a band aid. The industry should be tossed out on its tail and left to die just like they’ve done to so many of the sheep they’ve sheared. Why does anyone believe a word that they spew? We Need reform now, in the form of “Regulation”

BINGO! If you were to drive drunk and kill someone as a result you are charged with vehicular homicide. If you were to buy a gun and shoot someone you are charged with murder. So what is it called when a sociopaths disguised as a white collar insurance executives recind benefits on a cancer patient in the middle of treatment...?

Doctors aren't aloud to make a legitimate, human error for fear of paying out millions in "pain and suffering" yet the insurance executives can strategically and deliberately "pull the plug" on heath care when someone becomes at risk of effecting their "bottom line."

Please get yourself in front of as many cameras as possible. People need to hear this.

Dear Mr. Potter,

Thank you for your article on the evils of the present system. I'm one of those who see the Obama plan as socialistic and, as Mark Steyn says, something that will change the nature of citizenship.
But what you know needs to be said! We need to change things. Do you have knowledge of and a perspective on the European & Canadian plans? They have evils too, shortcomings so serious that I don't want "em here. I hope you don't come out unabashedly for a single-payer option without knowing how it's worked out other places.
What you know may contribute toward important reforms in Medicare, maybe changes to the whole system. I look forward to hearing what you have to say.
Sincerely,
Bayard Bastedo

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