6.26.2009

insurance spin doctor opens his eyes: "it was like being in another country"

David Corn, writing in Mother Jones, has a portion of an interview with Wendell Potter, a former spokesperson for CIGNA, the fourth-largest health insurer in the US. The interviewer is a writer with Columbia Journalism Review.
Trudy Lieberman: Why did you leave CIGNA?

Wendell Potter: I didn't want to be part of another health insurance industry effort to shape reform that would benefit the industry at the expense of the public.

TL: Was there anything in particular that turned you against the industry?

WP: A couple of years ago I was in Tennessee and saw an ad for a health expedition in the nearby town of Wise, Virginia. Out of curiosity I went and was overwhelmed by what I saw. Hundreds of people were standing in line to get free medical care in animal stalls. Some had camped out the night before in the rain. It was like being in a different country. It moved me to tears. Shortly afterward I was flying in a corporate jet and realized someone's insurance premiums were paying for me to fly that way. I knew it wasn't long before I had to leave the industry. It was like my road to Damascus.

Potter's "it was like being in a different country" relates perfectly to my US-turning-into-third-world-country theme. Every year, my brother travels with expeditions that bring surgical procedures to un-served populations. What he has experienced in Kenya, Nicaragua and elsewhere isn't too far from what Potter saw in Virginia.

The CJR interview details how the insurance industry manipulates the media, and runs covert campaigns to scuttle reform efforts. Corn writes:
It's a chilling account--especially when you consider that the Obama administration and Dems on the Hill this time around are trying to bring the health insurance industry into the tent. Reading Potter's account, you'll find it hard to believe that the legislators or the White House can get the better deal in any collaborative process with these profit-driven wizards of publicity and politics.

Potter reached a wider audience by testifying at a health-care hearing in Washington, confirming what we all know.
"[T]hey confuse their customers and dump the sick, all so they can satisfy their Wall Street investors," former Cigna senior executive Wendell Potter said during a hearing on health insurance today before the Senate Committee on Commerce, Science, and Transportation.

Potter, who has more than 20 years of experience working in public relations for insurance companies Cigna and Humana, said companies routinely drop seriously ill policyholders so they can meet "Wall Street's relentless profit expectations."

"They look carefully to see if a sick policyholder may have omitted a minor illness, a pre-existing condition, when applying for coverage, and then they use that as justification to cancel the policy, even if the enrollee has never missed a premium payment," Potter said. "…(D)umping a small number of enrollees can have a big effect on the bottom line."

Small businesses, in particular, he said, have had trouble maintaining their employee health insurance coverage, he said.

"All it takes is one illness or accident among employees at a small business to prompt an insurance company to hike the next year's premiums so high that the employer has to cut benefits, shop for another carrier, or stop offering coverage altogether," he said.

Potter also faulted insurance companies for being misleading both in advertising their policies to new customers and in communicating with existing policyholders.

More and more people, he said, are falling victim to "deceptive marketing practices" that encourage them to buy "what essentially is fake insurance," policies with high costs but surprisingly limited benefits.

Insurance companies continue to mislead consumers through "explanation of benefits" documents that note what payments the insurance company made and what's left for consumers to pay out of pocket, Potter said.

The documents, he said, are "notoriously incomprehensible."

"Insurers know that policyholders are so baffled by those notices they usually just ignore them or throw them away. And that's exactly the point," he said. "If they were more understandable, more consumers might realize that they are being ripped off."

Until the profit motive is removed from health care, the system will never work. As long as the private insurers are involved, there can be no meaningful reform.

Thanks to Allan, James and two anonymous senders.

4 comments:

impudent strumpet said...

I always find it weird when USians (and pro-privatization Canadians) never think, in the first person, "What if I didn't have medical insurance?"

Also, based on some of the numbers in that article, some people in some places might be paying more for medical insurance than they are for rent!

L-girl said...

"I always find it weird when USians (and pro-privatization Canadians) never think, in the first person, "What if I didn't have medical insurance?""

ME TOO

The anti-single-payer people in the US claim they would just pay for everything out-of-pocket, and that's what everyone should do anyone - "pay their own way". Not sure what they think happens when their medical bills outstrip all their income and savings, which can happen very quickly.

impudent strumpet said...

I once saw a blog by the mother of a baby that was born a prematurely and required a period of hospitalization. She said that the total cost, including what her insurance paid, was well into six digits. I forget the exact amount, but I distinctly remember that it was more than a house would likely cost - like approaching $500,000. This wasn't rare miracle treatment or anything, the baby just had to be in a box with tubes sticking out of him for a while, the sort of thing that's scary but any neonatal ward can do it. Their insurance covered most of it, but their co-pay was in the high four digits or low five digits. They had a payment plan. For their co-pay. For treatment that basically consisted of perfectly ordinary measures to avoid completely preventable infant mortality. And they thought this was normal.

L-girl said...

Yup.

Add to that, often, fighting with the insurance company to get them to honour the terms of your coverage AND being billed for charges you don't owe by the hospital itself.

US hospitals are *notorious* for double billing - billing the patient for what insurance is paying for. If you are ignorant or afraid or overly compliant, you pay. If you're already hip to it, you just toss out the bill.