The Ultimate Irony: Health Care Industry Adopts Big Tobacco's PR Tactics

Submitted by Wendell Potter on

At first look, one might not think that the health insurance industry has much in common with the tobacco industry. After all, one sells a product that kills people and the other sells a product nominally aimed at putting people back together. But when it comes to deceitful public relations techniques, the health insurance industry has been learning well from Big Tobacco, which employed a panoply of shady but highly successful public relations tactics to fend off changes to its business for generations.

One of the things I said in my testimony before the Senate Commerce Committee on June 24 is that the health insurance industry engages in duplicitous public relations campaigns to influence public opinion and the debate on health care reform. By that I mean there are campaigns they want you to you know about, and those they don't.

When you hear insurance company executives talk about how much they support health care reform and can be counted on by the President and Congress to be there for them, that's the campaign they want you to be aware of. I call it their PR charm offensive.

When you read or hear someone other than an insurance company executive -- including members of Congress -- trash some aspect of reform the industry doesn't like, such as the creation of a public health insurance option, there's a better-than-even chance that person is shilling for the industry. That's the PR campaign the industry doesn't want you to know about.

The public relations and lobbying firms that work for the industry plan and carry out those deception-based campaigns, and supply the shills with talking points. One of many tactics they use is to get people who are ideologically in sync with the industry's agenda to turn those talking points into letters to the editor.

An example of a letter that contained many of the industry's messages appeared in the June 27 edition of the New York Times.

The writer, Pete Petersen, identified as an employee benefits consultant for small employers, took issue with a June 20 Times editorial, which noted that, like Medicare, "a public (health insurance) plan would have lower administrative expenses than private plans."

Mr. Petersen claimed that the Medicare program is a poor example of an efficient government program, because it is administered by the private sector. While it is true that the government contracts with private companies to handle claims, the reason Medicare has such low administrative costs is because it does not have the unnecessary overhead expenses private insurers have, such as costs associated with sales, marketing and underwriting.

Mr. Peterson also wrote that Medicaid, Champus and state CHIPs "that are administered by federal, state and municipal authorities" average 26 percent in administrative costs. What he did not mention is that in many if not most cases, those authorities have turned those programs over to the insurance industry to run. Private insurers' involvement in those programs is much greater than in the Medicare program. That helps explain why they have higher administrative costs.

Mr. Peterson also claimed that, according to a 2006 PricewaterhouseCoopers study, "86 cents of every premium dollar goes directly toward paying for medical services." What he does not disclose is that America's Health Insurance Plans, the insurance industry's biggest trade and lobbying group, commissioned that study. A 2008 study by PricewaterhouseCoopers that was not paid for by the insurance industry tells a different and more revealing story. That study reveals that the percentage of premium dollars going to pay for medical care has fallen from more than 95 percent to slightly more than 80 percent since 1993.

For another great example of how the insurance industry uses its allies to flood newspapers with letters to the editor, read Trudy Lieberman's April blog post for Columbia Journalism Review. She discloses how an alert editorial page editor at the North Andover, Massachusetts Eagle-Tribune caught the industry red-handed.

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

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canvas replied on

This is truly best article is that With this legislation, candidates for Congress could rely on grass-roots supporters to respond to threats from special interests outside their district. Instead of turning to lobbyists and political action committees, candidates could counter attacks with small donations from within their district, matched four to one. san diego wrongful death lawyer

Anonymous replied on

THANK YOU !!! You need to preach to other than members of the choir as well. What you have to tell needs to be spread around.

Lynn Dee replied on

Mr. Potter, I just saw your interview with Bill Moyer and was very heartened to know you're helping to get health reform through. It's been discouraging to watch the back and forth, the various "trial balloons" sent up by the Administration or this or that faction of Congress. I have no idea whether reform will happen this year or not. (In fact, do you have any sense of the likelihood of reform getting through? Perhaps you could say something about that.) I have heath care through my employer and thus far have no complaints. But my 22 year old son has had diabetes since he was 14 months old. I used to hope for a cure. Now I just hope for health care reform before he's out of college and can no longer be on my health care plan. BTW, I meant to say I can well understand what a shock it must've been to see the lines of people at the Wyse County Health Fair in Virginia. It was a shock to watch it on T.V. It's easy to imagine that the uninsured are somehow managing to find health care somewhere, if perhaps having to scrimp and save -- and quite depressing to realize in this country of wealth that people are traveling for hundreds of miles to be seen by a doctor they've never seen before and will likely never see again, and who knows nothing of their history. Anyway, thank you for your work and for your profile in courage.

sissytoo replied on

The agency I work for recently sponsored a RAM (Rural Area Medical- www,ramusa.org) clinic which offers free dental, medical and eyeglasses to people who need them. It is a travesty that people go without dental and medical care, without eyeglasses, in this country. RAM is so wonderful- many people were helped but of course there were a lot that needed services we were unable to perform during a one time visit. We need health care here but I think that keeping the status quo, insurance companies, is not the answer.

Bob Greene replied on

I have seen several samples of issue-advocacy software used to generate letters to a publication. The software is designed to obtain an endorsement from the person who reads a motivational cover message, usually sent by email. The message entices the reader to initiate the process by clicking on a hyperlink in the message text to "learn more" or some equally non-committal motive. After reading the cover letter and starting the hyperlink, the reader is led to a page where he "composes" a letter to his congressman and/or senator from a one of three or four prepared bodies of text. To the assembled "letter" is attached the reader's name, postal address and email address. Sometimes, along with phone number. In some variations of this software, there is a box in which the reader actually composes his own free-form response. At some point, the reader who expects his message will be sent to the appropriate parties already named is asked to name his local newspaper of record. Here is where the software has been deliberately deceptive-- the early versions, at least, never explicitly state the reader's "letter" also will be sent to the local newspaper. That is to say, many of those readers said to have sent a message to an editor never knew they sent the message!

John V. replied on

Your appearance on Bill Moyers' Journal was terrific--extremely informative. But while you said that you are a capitalist, you did not clearly say that the healthcare insurance industry is anti-capitalist. As you stated, they are anti-competition and monopolism is not capitalism. Competition is the heart of capitalism, and they openly reject it.

Mbuya Nehanda replied on

I watched you on bill moyers show yesterday and I would like to say thank you. I applaud your courage in speaking the truth moreso now at a time of distorted information. and half truths. May you continue the work.

Sheldon Hall replied on

This article uses the same tactics as the tobacco industry that it purports to criticize. It refers to the insurance companies as being the "health care industry". It ignores the fact that the "health care industry" consists of, guess what, health care providers; doctors, nurse, hospitals, etc, etc. By attacking the insurance companies, which are easy targets, and referring to them as the "health care industry", they seek to generate criticism of the whole industry. Demonize one, demonize all. From what I've seen, so far, the political debate has been all about money, and only pays lip service to the actual patients, and providers. A rational health care system should be centered on the needs of the patient, and the actual providers. How can we ever have any effective health care system without the cooperation of the providers themselves ? Personally, I think the notion that the government can provide a better health care system, cheaper, is not even rational.

Lynn Dee replied on

The problem with referring to the insurance industry as the health care industry is that it misses the reason why the free market doesn't work to bring health care to people. Unlike food or clothing or any other commodity, where if the seller doesn't sell the product it won't make money, insurance companies aren't in the business of selling health care. They're in the business of selling insurance. So they don't give a damn if people are provided health care so long as they're paying for insurance. In fact, as Mr. Potter points out, the portion of any dollar that goes to pay for medical claims has dropped from 95 cents to about 80 cents in just the last 15 years. We need a public option. The only alternative would be government rulemaking, and that's not gonna happen. It's tough not to conclude that anyone who thinks government won't work must be working for the insurance companies.

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