The Health Care Industry vs. Health Reform

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.


As a CIGNA marketing exec and later as an independent consultant I travel traveled extensively in Western Europe to establish partnerships with private insurance companies to serve the needs of domestic clients with employees located overseas, and to assist foreign insurers to develop supplemental lines of health coverage’s such as dental insurance. It was an opportunity to observe nationalized health systems up close. In the broad picture European and Canadian health systems function well. As compared with the U.S. system, they provide basic, life-saving medical insurance coverage to all citizens regardless of health status with loser costs and better outcomes. The U.S. system remains mosty private except for selected segments of the population such as seniors. The World Health Organization ranking for the quality of national health care systems pegs the U.S. # 37, even though we spent nearly twice as much as others to sustain our system. Increasingly Americans are traveling to foreign countries for major health services. Open heart surgery in India is half the U.S. cost with better outcomes. The number of U.S. citizens going overseas for care now exceeds the number for foreign residents coming to the U.S. for health care services. It is fair to say that covering everyone as in European and Canadian plans can produce waiting lines and a lower quality of care. For example, an age 80 patient in need of a hip replacement may be assigned to the end of the line to favor a patient half that age that can be expected to quickly return to a productive position in the work force. However, if this is of concern to a covered individual that person often can purchase supplemental insurance coverage from a private insurer at their own expense. For various reasons the private insurance component in Canada is very low, only about 1% of core services. I know of no health insurance system that works to absolute perfection for everyone all the time. But based on more than 40 years of experience in the private health insurance, and observing how it has developed, I am confident Americans would be much better served by a nationalized health insurance model such as embraced by all the other industrialized nations on this planet. Unfortunately, we have so politicalized the issue the benefits of a nationalized system may be delayed beyond the 80 year effort to do what is right for all Americans.

Wendell, thank you for telling it like it is about the insurance industry. Health insurance is not the only form of insurance where abuses occur. People still assume that the goal of their insurance carriers is to take care of them in trying times. While there are many insurance agents and brokers who do care about their clients, the reality is that carriers are just very lucrative businesses that collect money for offering promises, while working very hard to ensure they will never have to deliver on them. The reality is more like a "Vegas", and in Vegas, the House always wins.

Thanks so much for speaking out. Things are so bad right now that every defeat for public health care is openly cheered on all the business networks and seen as a bullish indicator for the market as a whole. What a lack of imagination! As if there's no way to make money unless people are treated like dirt! Have courage---you're doing the right thing. I look forward to your next post.

Thank you, Wendell, for your courageous stand. That thanks isn't enough, though. We need to take the next step together, everyone who is outraged by the health insurance situation in this country. We need to do as the Civil Rights Movement did, take it to the lunch counters (insurance companies), to the courts, to the streets, if need be. Recission may violate the Civil Rights Act of 1964, on a de facto basis since it is practiced routinely against those with prior heatlh conditions and those people fall most heavily in protected groups, namely women of childbearing age and workers 48-64 years old. Purging may violate the HIPAA Act of 1996, because it results in insurers and health plans revealing illness information to employers for individuals, who eventually get fired for a trumped-up cause to lower the employer's premiums. There may be other violations as well; I am no attorney although I do have some familiarity with both of these pieces of legislation. What can be done to help?

You are my hero Wendell Potter. I wish I had faith that our political leaders had the intelligence and backbone to give us good healthcare. I'm surprised that business doesn't support reform...if we all shared the cost, everyone would benefit and not be stuck paying the high price to be ruined. Thank you for fighting for us. Nancy

You have said you liked your colleagues at Humana and Cigna. Yes, they are not "evil" in the way that we so often imagine evil. Hannah Arendt got it exactly right: evil is mostly coomonplace and banal. The evil that is bringing our nation down is the kind you have described: decent-enough people willing to go along with evil practices, in either industry or government, in return for money and power. With fewer people like you and more people like your former colleagues, we truly are on a path heading downward, down toward a cultural decline that our fanatical Islamo-fascist enemies need only step back and watch unfold. They do not need to destroy the "great Satan." We are doing a good job of destroying ourselves. Only decent and courageous men like you stand in the way of our cultural, moral, social, and political decline. God bless you! Maybe God sends us both good men like you and also makes use of our evil Islamo-fascist enemies, who might also remind Americans of the goodness at the core of the North American experiment in self-government (which cannot survive absent virtuous citizens like you).

Mr. Potter, I'm deeply grateful and relieved to read your post today. The debate on healthcare has been completely redirected from the real issues, and I am stymied and frustrated the more I read the coverage. I feel like most Americans have just lost their minds -- those who fight coverage for all out of fear that their coverage will be lessened have sort of lost their moral grip, haven't they? It's as if health care has become a pinata and the wealthy are elbowing their way to the front, swinging their bat, terrified that someone will get more candy they they will. There seem to be two lines of logic, that if they are followed, really demonstrate how twisted our morals have become - #1 - If we allow coverage for ALL some of us are going to get lower quality care when we are really sick. If you follow this line of logic out, then what they are arguing is this "I would prefer to deny others basic and life saving care so that I can be sure I will get the most sophisticated care... IF I get sick." Really? Is that REALLY what they want to argue? #2 - Only those Americans who meet the right criteria should get coverage. Those criteria include citizenship, a great job, perfect health, ability to work, ability to pay large bills that exceed normal coverage, ability to take time from work to manage healthcare when sick. If you don't meet this criteria, then you simply don't deserve healthcare. Now, again, if we follow this line of argument, you must allow the fact that these criteria, over time, will continue to narrow. The coverage will continue to shrink. Fewer Americans will be covered for less coverage. So before you make this argument, consider that ANY of us could easily slip right out of the criteria that exisit, and then the odds of that happening will continue to increase as we age. Please keep talking, speaking the truth, sharing your story and destroy the myths. Thank you and congratulations.

Wendell- I was at the Rally for Health Reform in Portland, OR and heard you speak. Your testimony was so powerful. Thank you for speaking out.

Hi Wendall, I'm an independent insurance producer of 24 years, primarily focused in group and individual business. I have been a proponet of single payer healthcare since before the Clinton administration. Reason?...I'm 56 years old and an insulin dependent diabetic. "PICTURE ME UNINSURABLE". I am really disturbed why the administration cannot seem to make it's case or elaborate on the reasons why it is better for the country than the profit making private companies that are currently making decisions based on the bottom line rather than the common good of our society. I'm wondering , do you think that the effect of single payer which would literally elimate thousands of jobs in the private sector be a factor? I WOULD ALSO LIKE TO VOLUNTEER MY SERVICES TO YOU. I can provide any information to you about what's going on in the industry here in the St. Louis marketing area if your interested. I also have some good idea's about language that should be used to get consumers on the side of reform. Hope to hear from you. Larry