Wendell Potter to Congress: Go Ahead, Please Make Our Day

Politico is reporting that Congressional Republicans want to force their colleagues in the House and Senate who vote for a public insurance option as part of health care reform to enroll in that public plan when it becomes available.

I think Democrats ought to call their bluff and pledge to be the first to sign up. If they do, they will have to shove me out of line. I would love to have the option of enrolling in a public plan that offers a decent standard benefit package at a more affordable price. I am sick and tired of knowing that only 80 cents of every dollar I pay in premiums to my private insurer goes to pay doctors and hospitals for care they provide. (This figure is down from 95 cents in 1993 before the industry came to be dominated by a cartel of high for-profit insurance companies like the two I used to work for.) I am eager not to have to donate 20 cents of every premium dollar to cover my insurer's sales, marketing and underwriting expenses and to help make the CEO and the big institutional investors and Wall Street hedge fund managers even more obscenely rich than they already are, thanks to the inflated premiums we have to pay.

Here's what Politico reported:

Rep. John Fleming (R-La.), a family physician, kicked off the quixotic bid last week, urging House members to give up their right to participate in the much-revered Federal Employees Health Benefits Program if they support a government-run program as part of the health care reform package.

Sens. John McCain of Arizona and Tom Coburn of Oklahoma are pushing the same concept in the Senate, preparing separate amendments that would require members -- and maybe even their staffs -- to sign up for the public option. With Democrats firmly in control of Congress, the idea is not likely to gain traction. Proponents of the public plan say the resolution would do exactly what Republicans have warned against, undermining the private insurance system by moving people into a public plan.

But the effort has caught fire in the right-wing blogosphere and on talk radio, serving as a rallying point for conservatives opposed to one of the top priorities of Democrats... Newt Gingrich's Center for Health Transformation is promoting Fleming's resolution on its website and started an online petition titled "Good Enough for Congress."

After Democrats call their bluff, I would counter with this: Every member of Congress who votes against the public insurance option must enroll in one of the high-deductible plans like the one that CIGNA forced me into a few years ago, against my wishes. (I am a former CIGNA employee, so CIGNA was both my employer and my insurance company.)

Opponents of health care reform raise the specter of the government forcing us out of health care plans that we like. In reality, our employers and insurers are doing this to us already. While employed at CIGNA, I was in a PPO that I liked, until the company decided a few years ago to force all if its employees out of their HMOs and PPOs and Point of Service plans and into what the industry refers to, misleadingly and euphemistically, as "consumer-driven" plans. It was a take-it-or-leave-it deal. If I didn't want to enroll in the high-deductible plan that CIGNA offered, I could join the growing ranks of the uninsured or try to get coverage through the individual market. That wasn't really an option. I was in my 50s and could not find a decent plan that I could afford, because insurers are free to gouge us when we reach a certain age.

In a high-deductible plan, enrollees have to spend a lot more money out of their own pockets before their insurance coverage kicks in than they had to spend in their HMOs and PPOs. These plans are fine for people who are young, healthy, and not accident-prone. and wealthy. It also helps to have a better-than-average income. In other words, a high-deductible plan might be exactly what you're looking for if you don't really need decent insurance now and can afford to shell out thousands of dollars of your own money in the event you get hit by a bus. The rest of us, however, might want to steer clear of this sort of plan -- if we had the choice.

More and more companies are doing what CIGNA did -- forcing their employees out of the plans they like and into plans they don't. Another big insurer, United Healthcare, did the same thing to its employees a few years ago. If it hasn't happened to you yet, just wait. Insurers are eager to send HMOs and PPOs to the ash heap of insurance history, which is where they sent traditional indemnity plans several years ago.

On second thought, it might be good to give members of Congress who vote against a public insurance option the choice of enrolling in one of the limited-benefit plans being promoted these days by insurers -- including the huge for-profit insurance companies that now dominate the industry. The premiums for these plans are a little lower than plans that offer comprehensive coverage, but they often don't cover things most of us have grown to expect. Little things like hospitalization. Such a deal.

Now you see why the insurance industry insists on being able to charge older folks a lot more for coverage than younger folks and why it is insisting on "benefit design flexibility." They want to have the flexibility to "design" and force us into plans that cover less and less and cost us more and more. That, readers, is what your private insurance company has in store for you if Congress fails to pass meaningful health care reform legislation.

By the way, insurers including CIGNA are now also marketing these limited-benefit, high-deductible plans as "voluntary." This means that your employer would allow you to enroll in these type of plans at the workplace but make you pay the entire amount of the premium. That's right, employers in the future will not have to contribute one thin dime toward your coverage. Future, heck, many are already there. A growing number of employers are already "offering" these plans to their employees. CIGNA offers such coverage under the brand name Starbridge, which "enables companies to offer a limited-benefit plan that is affordable and does not require employer contribution." The underwriting guidelines for Starbridge make it available only to employers who have at least 70 percent annual employee turnover and who have fewer than 65 percent female employees. Also, the average age of the workforce has to be 40 or younger. You're right if you think the profit margins on these plans are high. How could they not be? Cha-ching!

I encourage every member of Congress, Republicans as well as Democrats, to do a little research into what Big Insurance has in store for us before voting on legislation this summer or fall.

This is why I left my job and why I am speaking out.

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


Wendell and Co. Glad to have come across your blog today for the first time. I've often wondered: Why not implement the "public utility" model for health insurance? That means private insurance companies continue to exist, but are regulated by an "insurance utility board" in each state. The board is charged with making sure insurance companies are providing sufficient service to all customers, have enough in reserves to pay all claims and cannot make more than a 15 percent net profit each year. I have not run any numbers on this kind of model, but would that likely bring down premium costs?

A bit of a turn of the tables, I suppose but: I propose that all members of congress and the executive be given a choice: Endorse single-payer universal health care or give up the coverage you receive as part of your compensation and shop in public (with the CBO's allowance for your coverage) for coverage in the marketplace. A written and televised (c-span, under oath) report of your findings will be a requirement. Written portion in your hand if you are able. Other wise notarized and not by an attorney. So there. If you think this system is so #$@%*&! great, YOU try it. Put your health where your mouth is. Can we take it away from them since we pay for it?

TO mister Potter, i was just reading an article in Commondreams.org about yourself: from being a very powerful individual, in the clearly "profiteering upon human suffering and need" insurance industry, to one that is doing what he can to reclaim his own conscience and humanity. In all history , we know that the poor, defenseless, powerless always have to eke out a living and while losing to the powerful and wealthy..and one loses hope almost that it can ALSO be from among those that had been in your own position that SOME sense of justice and humanity can come from within such a cruel system towards so many others in this world, rather than always having to come from the longing and suffering majority of people anywhere.. Your "new" work towards economic and humane justice regarding health care reminds one of the saying that applies NOBLY to yourself in this capacity: "to those to whom much is given, much is expected" - and you STEPPED UP to this sense of humanity, imo, in no less moving a way , and hopefully as effectively as you would now dream of, as the great humanitarians of history , such as Mahatma Gandhi and others. Thank you for your sense of humanity. All good health and long, truly fruitful and meaningful life to you and your family and all you love. You are who we must call - a citizen of the world.

I am former executive with a national group insurance company (same as Mr. Potter's last employer) who has held positions in Underwriting, Marketing and Product Management. I have firsthand knowledge of Commercial HMO, Medicare HMO, small group (50-200 employees) and large group (200+), including multi-site national accounts. Here’s what I believe is needed in any “reform” legislation. 1. Tax health insurance premiums paid by employers as any other compensation. The current exemption was a reaction to Federal Government wage and price controls and did not evolve in a free market. The current tax treatment masks the true cost health insurance leading to distorted behavior at the consumer level. 2. Mandate that every resident of the US be covered by a health insurance plan whether employer provided, through a union or individually purchased. The controversies over “pre-existing conditions” and individual underwriting are resolved if everyone, from birth, has coverage. There are no “free riders.” The political process can decide at what level of poverty premiums should be subsidized by taxpayers. 3. Establish a minimum benefits plan. The Devil will truly be in these details, but without a minimum plan the issue of the underinsured will remain. Except for the poorest among us the plan should call for cost sharing for all but preventive care and the treatment of chronic disease. The focus should be on protection against catastrophic expenses, the kind that bankrupt families, rather than day to day expenses. The degree of personal responsibility (that is, how much you must pay yourself) could be established as a function of family income much as today’s medical expense deduction is. 4. Establish premiums using a “community rating by class” methodology (CRC). This provides for some recognition that medical expenses, in fact, vary by age, sex and geographic local. In addition, at the individual insured level, allow for “good health” discounts from the CRC premiums for those who meet certain standards shown to be consistent with lowered medical costs such as not smoking, maintaining an appropriate weight and following preventive care regimens. 5. Provide for risk adjustment pools among participating insurers. This protects any single insurer from attracting more than the “normal” number of catastrophic cases. Participating insurance companies would pay into this “re-insurance” pool which would be required to be self supporting (no government subsidy). 6. Abolish all State mandated benefits. There must be a single, national plan available to all. With the other provisions listed this will ensure that insurance is portable, freeing American labor to move to better opportunities without fear of losing insurance. 7. There is no need for a “Public Option” if these rules are implemented, but if we must have one it must be self supporting (no government subsidy) and adhere to the same rules as private plans. Furthermore, any fee schedule “negotiated” by a Federal plan must be available to any participating insurance company as well.

you want your for-profit industry's stranglehold on health care for all Americans enshrined in law forever. So nice of you to allow the American people to seek a public option from their government which exists, among other reasons, to "promote the general welfare," provided it doesn't actually compete with the for-profits. I don't think you need to worry too much -- I'm sure the industry lobby will see to it that any public option is so crappy most people will opt for not-much-better private offerings. The for-profit industry is responsible for the disgraceful condition of U.S. health care today. Why should anyone listen to you at all?

Mutternich, thanks for being involved enough to respond to my comments on healthcare "reform." However, you didn't say what you believe the solution to be (other than the implication that a government plan is better than a private one). If you have thought this through, write about it; on forums like this and to your elected representatives. See how your ideas stand up, and, just think, maybe your idea is the best and will get enacted.

<blockquote>However, you didn't say what you believe the solution to be (other than the implication that a government plan is better than a private one).</blockquote> Single payer universal coverage. Take health care financing completely out of the for-profit sector and give it to democratically accountable government. Make the lobbyists find other interests to lobby for. Otherwise the imperative to maximize profits will always trump patient care. Thank you so much for your advice. I'd never have thought of it.

Examine the systems in Canada, the UK, France and The Netherlands. Two have what you think is most desirable; two combine public and private plans. You may change your mind. When you say "democratically accountable" why do I think of the Post Office, Fannie and Freddie, Amtrak, Medicare and Medicaid? The USA sure doesn't have much of a track record in the accountability department. Maybe Mark Twain was correct that the US Congress is our only natural criminal class.

<blockquote>...[W]hy do I think of the Post Office, Fannie and Freddie, Amtrak, Medicare and Medicaid? </blockquote> I dunno, you're the one thinking of them. Why would I think of Enron and Arthur Andersen if you mentioned corporate responsibility? When I say "democratically accountable" that has to start with our elected representatives and our representatives in Congress are mostly accountable to the moneyed interests who fund their campaigns. Like the health insurance industry, for instance. Freddie and Fannie? The worst sort of "public-private partnership" -- profits privatized, liabilities socialized, i.e. stuck to the taxpayers. The Post Office? Worth subsidizing for the service it provides everyone, not just the most profitable customers. Make junk mailers pay more if you want less subsidy. Medicare? It's worked pretty well for me, I think everyone should have it. One thing -- my statements from Medicare tell me I "may be billed" for my co-pay several weeks after I've received and paid the bill. Damned inefficient government -- oh, wait: that's handled by a private contractor. You know, "private" as in "for profit." Amtrak: You mean to tell me America, the self-styled greatest country in the world, couldn't equal or beat anything those socialistic Europeans can do, if the political will existed? Actually,.political will does exist for all sorts of reforms you consider "socialistic" -- it's just that in this country "political will" has come to be identified as corporate will, not that of the majority of everyday Americans. Congress isn't a "natural criminal class," it's a nurtured criminal class, and your industry is one of the most attentive nurturers..

Caught you on Coundown tonight w/ Howard Dean. I am so encouraged to know someone with your experience of the industry is speaking out. And thank you for the information above re/ limited-benefit plans. Having recently exhausted COBRA, I encountered these plans when family friends kept insisting that "of course you can get coverage for less than $1K/mo for an individual policy. AND it will cover pre-existing conditions!" Yeah, right. The limited benefit plan being heavily advertised here -- FOR LESS THAN THE COST OF ONE GOURMET CUP OF COFFEE PER DAY -- is from Cinergy. I was astounded by the limited benefits. Why not cover pre-existing conditions? They don't pay for much of anything anyway! I live in an area dominated by the military and military retirees who are clueless about the private insurance market. These advertisements are seriously skewing the public's perception of the need for reform. Knowing the industry term for them will let me do more research for a letter to the editor I hope to write. Many thanks - keep it up and I hope we see more of you on the news shows. Valerie Sellers Niceville, FL