He's not well known to most Americans. But he worked for almost 20 years as an insurance executive, almost 15 for Cigna (one of the nation's largest insurance companies) until he decided he'd had enough. He then blew the whistle on insurers at congressional hearings last June when he revealed how private insurers dumped patients with costly health problems to protect their profits. Now he's speaking out on the practices of these same insurers. He gave up a high paying job as an insurance company PR honcho in a giant glass and concrete high-rise for a simpler life with a non-profit, citizen based group, the Center for Media and Democracy based in Madison, Wisconsin. Ladies and Gentlemen please meet (and LISTEN UP) to Wendell Potter. Potter has insights into corporate insurance practices that are especially important now that President Obama has told us in his health care speech that his own plan will largely be based on private insurance (with some tweaks of the old, failed system). NOTE: this diary has been updated to include a long talk between Amy Goodman and Potter on democracynow.org See Update #3.
Potter was interviewed by Shawn Doherty of the Capital Times (Madison, Wisconsin) in preparation for Potter's speech at the Fighting Bob Fest, the largest annual meeting of progressives in America. Kudos to Doherty who did an excellent job of journalism. Here are some highlights (edited) from the Wendell Potter-Doherty interview with my annotated comments following.
- First, on why Potter left the insurance companies to fight against them:
CT: You were a big shot for years for the health insurance industry. Why did you suddenly decide to switch sides...?
Potter: My decision to leave the industry and speak out were two different things. I chose to leave my job because I was growing increasingly disillusioned about the kinds of health care policies that the industry is moving toward. The industry calls them consumer-directed plans, which is a euphemism that would make one think they might have been designed by consumers for consumers. But they are not in the best interest of most Americans. They require high deductibles and require people to make more decisions on their own and pay more expenses out of their own pockets. There are other policies that are called limited-benefit plans that don't cover nearly enough. I refer to many of these plans as fake insurance or junk insurance because people are under the misapprehension that insurance is comprehensive. But the marketing materials companies use are misleading...
...Lately, as I've been talking to groups, I've been apologizing for the role I played in defeating reform. I'm ashamed not only of what the industry has done and become but of those of us who have done public relations for the big role we play. What I'm doing now is making amends for cheating people out of reform when the insurance industry killed the Clinton plan. It's something that I can't do over so I'm trying to make use of the insider information that I have to explain to people how the industry really works.
SOURCE: (same source throughout unless otherwise noted)
FFlambeau comment: Notice Potter's statement about "junk insurance"-- something that is lost in the talk of reform. We hear about the insured vs. the uninsured but few people realize how many of the "insured" actually have "junk insurance": insurance that has limited benefits, high deductibles and make people pay expenses out of their own pockets. This problem MUST be addressed in any Obama, insurance-based plan. Since Potter was a PR man, he knows what he's talking about when he also says that insurance company marketing techniques mislead people (and politicians) on what they in fact do.
- On the problems facing the Clinton Administration compared to the problems now:
CT: How has the industry changed in the past 15 years or so since there was a similar debate over the Clinton plans for health care reform?
Potter: The for-profit insurers now dominate the industry. There has been significant consolidation since the last time we had this debate. There are now fewer insurance companies and a small number of very, very large companies... The seven largest of these companies have total revenues of $250 billion. One out of every three people who has coverage is enrolled with them. So they are ...dominant. Today insurance premiums are much higher, people have few choices, and the costs of care are much higher. More people are uninsured. And a real problem that will soon get much worse is that a growing number of people are underinsured - enrolled in these high-deductible or limited insurance plans that don't really protect them.
FFlambeau comment: Great question! And great, no bullshit answer. Note again the emphasis on not just the UNINSURED but the importance of the UNDERINSURED who do not show up so much in the statistics that even the administration is using.
- A good follow-up question to the above:
CT: How might this changed marketplace affect the battle over health care reform?
Potter: What we really have now is a cartel of large insurance companies that control not only the market but the debate on health insurance. And most people don't even know it. These companies contribute millions and millions of dollars on lobbying efforts to persuade politicians to vote against reform and on public relations campaigns that are designed to mislead and deceive people. They are much richer and much more powerful than they were in '93 and '94 and even back then they were able to kill the Clinton plan.
FFlambeau comment: And Max Baucus and many of our Democratic friends are taking their money too!
- How insurance companies attempted to belittle Michael Moore and "Sicko":
CT: How did the industry really work in the campaign to discredit Michael Moore and his movie "SiCKO" - which you played a part in?
Potter: The industry trade association was very worried about the movie and started the effort to discredit it and Michael Moore even before it came out. The PR strategy was to try to discredit the filmmaker by referring to him as "Hollywood filmmaker Michael Moore" as opposed to a documentary movie maker. And to demean and criticize the health systems in the movie. They used the same PR tactics that they used to defeat reform in 1993 by warning that if Americans were to embrace a system like one of the countries depicted in the movie they would be getting socialism and a government takeover of health care. The industry created a front group called Health Care America that was operated by a PR group. It was a real shell organization and it was created only to discredit the movie. These are typical tactics used by the tobacco industry.
...They were able to radicalize and marginalize Michael Moore. They were able to make people believe anything Michael Moore did was too socialistic and to the left of most Americans to be considered credible. The overall impact of the movie was diminished by this concerted effort and the millions of dollars spent to discredit it. I suspect the industry spent more money to discredit the movie than Michael Moore spent to make it.
FFlambeau Comment: The same kind of effort that big business has always used against Michael Moore. But you know: it didn't work because Michael Moore doesn't give up!
- Potter's view of Moore's "Sicko":
CT: What did you think personally about the movie you tried to tear down?
Potter: It was very accurate. ...
FFlambeau Comment (speaking with a megaphone): YEESS IT WAASS! Michael Moore rocks.
- How Moore's movie influenced Potter to "take the leap":
CT: What finally made you take the leap?
Potter: A month after "SICKO" came out I was visiting my parents, who live in the northeastern part of Tennessee very close to the border of Virginia. And I heard about this health care exposition being held up the road in West Virginia and it intrigued me. So I went to take a look at it ... When I walked through the fairground gates I was just stunned... There were hundreds and hundreds of people waiting in line, standing in the rain, just to get care. They were treating patients in animal stalls. Other treatment areas were in tents. You could see people being treated right out there in the open, like this was a war-torn country or refugee camp or a Third World country. And I thought: is this my country?
FFlambeau comment: Recently there was another one of these health care expositions, this time in Los Angeles (I cannot remember the wonderful elderly gentlemen (in his 70's) who sponsors these; any help readers?) and the result was the same. We ARE living in a 3rd world country. The United States is the only major industrial country in the West that has such a shitty (and costly) system of "health care".
UPDATED to include this comment & info from YucatanMan:
The organization that put on the LA Health Fairs was Remote Area Medical: http://www.ramusa.org/
They normally provide services - organizing local and traveling doctors, dentists, nurses, etc - in Third World Nations. But lately, it's been more clear that the USA needs lots of help too. And, the health care professionals needed for such fairs are readily available too.
Donate to them. I do.
- On why it is a MISTAKE to build on the failed, insurance-based system (as Obama's health care "reform" does):
CT: Is it possible to have a decent health care system driven by profits?
Potter: I don't think so...By focusing on profits you have to take measures to reduce risk. You have to figure out ways to deny coverage or exclude some people from coverage.
CT: But this spring, health insurance executives promised to do away with pre-existing condition exclusions.
Potter: Empty rhetoric. That is the part of the PR campaign that they want you to see. The charm offensive. You'll see some executives on TV and read their quotes in newspapers. You'll hear them testify in Congress and promise (President) Obama they will work to help achieve reform. They want you to believe they're wearing white hats. But the other secret campaign is one they don't want you to see. They're working through these big PR firms that use conservative talk-shows hosts and editorial writers to be what they call third-party advocates. To be shills. To scare people by using terms like "government takeover" and "tax increases" and "socialism." It's fabrication and based on lies but that's fine with them as long as they achieve their end results.
CT: Which end results?
Potter: Cheating reform.
FFlambeau Comment: The above discussion is hugely important, especially where Potter calls out the "reform" talk on the "promise to do away with pre-existing condition exclusions" as "empty rhetoric". Remember a certain politician who recently spoke to the nation and promised to do away with "pre-existing conditions exclusions"? It ain't gonna happen in a system that is still built on the rotten foundations of private insurance because insurance is predicated on paying out less in benefits than insurers take in by way of premiums.
- How insurers (and their allies) manipulate public opinion & the role of the media:
CT: ... So are you saying these people are stupid to believe this stuff?
Potter: People keep falling for it because there is almost no awareness of how special interests manipulate public opinion. ...the big, rich special interests are able to not only work through lobbyists to persuade lawmakers to do things their own way but have become almost invisible persuaders. And people unwillingly and unknowingly have become pawns and advocates and spokespeople for the industry. And they don't even know it. Because often they are getting their information not from the mainstream media but from people they think are credible and trustworthy sources. From an editorial writer or conservative talk-show host. I know that, for example, back in the Clinton campaign they were able to get information to people like Rush Limbaugh. They worked through big conservative think tanks like the American Enterprise Institute and the Heritage Foundation, all allies of the industry. So they funnel talking points and get information to these pundits. The editorial page director of the Wall Street Journal is on their speed dial right now...
CT: But if reform fails is it really as simple as because the industry is powerful and evil and blocks meaningful change? How about the roles being played - or not - by the media and pro-reform activists?
Potter: ...The media has not done an adequate job of showing what is really going on. Part of the reason is we've seen a decline in the resources of the mainstream media. Reporters are stressed. There's not much news space or interest on the part of editors to health care in an adequate way. There is very little investigative journalism. Even the best papers are not doing a very good job in covering all the reasons we're having this debate. They're just resorting to the fairly easy task of reporting the contest on Capitol Hill.
FFlambeau Comment: Yup, little investigative journalism and consolidation in the mainstream media, meaning fewer news outlets and more outlets owned by the same people. Bill Clinton and the Democrats made a huge mistake when they permitted this back in the 90's. It's a problem that the Obama administration should revisit.
- On the future and what can be done:
CT: How about advocates for reform?
Potter: The advocates have not done a very good job of representing the benefits of reform, in presenting what a public option would be and how it would benefit people. I don't think that the advocates anticipated adequately and planned adequately for the opposition that was inevitable...the enemies of health care reform have used these same tactics time and time again. Frankly what we're seeing is that health care advocates were overconfident. I kept hearing that the stars were aligning and that now that we had Obama in the White House and Democrats in the majority, well, what could go wrong? Well, I'll be blunt. Yes, the president gave wonderful speeches but he has failed to communicate the real reasons we need this reform. Maybe that will change next week when he speaks to Congress. Maybe then he will refute the lies and call them out. But he needs to really connect to people emotionally to make sure they understand what we need to do and why.
CT: So what's going to happen in the next few weeks?
Potter: I predict Congress will pass something. The president and Congress have so much invested they will claim victory and do their best to persuade the public that it is a big step forward. But I do worry that some of the most important components of the legislation might not survive. I am not throwing in the towel. Some people have already written the obituary for the public insurance option. I'm hopeful. But it will take a lot more leadership. ...people in Wisconsin [must] get in touch with their members of Congress. It's not enough to have voted for a president or to have large majorities. There are billions at stake and the industry is fighting this big-time. These could be the most important weeks in our country's history. People need to see it in that way and do more than they are currently doing to communicate their hopes and their beliefs.
FFlambeau Comment: The push for true health-care reform (and I don't mean a half-assed system based on a failed and costly private insurance foundation that has NOT worked for decades) will need to come from a groundswell of average Americans. And I don't mean from the top-down because our "top" has already been co-opted. Remember all of those secret, closed door meeting between the administration and the insurers? And this coming after a promise to hold ALL health care reform meetings in public and to televise them live on C-SPAN. What a whopper that was!
Kudos again to Wendell Potter and the journalist from the Capital Times who interviewed him, Shawn Doherty. We often complain about journalists but this one did a great job! You can send your compliments to the journalist at:
UPDATE #1: Video Interview of Potter with Bill Moyers.
You can see a great interview by one of America's best journalists, Bill Moyers, who talks with Potter. I'm not savvy enough to clip the video and post it here but maybe someone can help? Moyer's web site also has Potter's testimony before congress and lots of other good stuff. Here's how it is all described over at Bill Moyer's web site:
Last month, testimony in front of the U.S. Senate Committee on Commerce, Science and Transportation by a former health insurance insider named Wendell Potter made news even before it occurred: CBS NEWS headlined: "Cigna Whistleblower to Testify." After Potter's testimony the industry scrambled to do damage control: "Insurers defend rescissions, take heat for lack of transparency."
In his first extended television interview since leaving the health insurance industry, Wendell Potter tells Bill Moyers why he left his successful career as the head of Public Relations for CIGNA, one of the nation's largest insurers, and decided to speak out against the industry. ...
Potter began his trip from health care spokesperson to reform advocate while back home in Tennessee. Potter attended a "health care expedition," a makeshift health clinic set up at a fairgrounds, and he tells Bill Moyers, "It was absolutely stunning. When I walked through the fairground gates, I saw hundreds of people lined up, in the rain. It was raining that day. Lined up, waiting to get care, in animal stalls. Animal stalls."
Looking back over his long career, Potter sees an industry corrupted by Wall Street expectations and greed. According to Potter, insurers have every incentive to deny coverage — every dollar they don't pay out to a claim is a dollar they can add to their profits, and Wall Street investors demand they pay out less every year. Under these conditions, Potter says, "You don't think about individual people. You think about the numbers, and whether or not you're going to meet Wall Street's expectations."
You can view Wendel Potter's congressional testimony online or read the text.
You can learn more about Remote Area Medical, the organization that put on the "health care expedition" here.
During the interview, Bill Moyers read from confidential documents drafted by America's Health Insurance Plans (AHIP) in May and June of 2007. The documents outline a unified strategy for AHIP members to prepare for the release of Michael Moore's documentary, SICKO on June 29, 2007.
You can download and read the full AHIP documents by clicking here and here (PDFs).
The Language of Health Care 2009 (PDF)
The Frank Luntz memo strategizing opposition to health care reform Bill Moyers mentions in the interview.
GOP Health Care Strategy (PDF)
Strategy memo by Alex Castellanos dated July 7, 2009.
Potter, by the way, recently spoke at the Fighting Bob Fest near Madison. Their website has video clips of speakers (but unfortunately it looks like video clips from past Bob Fest's and not this year's. Maybe they can get a You Tube video up of this year's talk given by Potter?
UPDATE #2: Info on Potter from the PR Watchdog: Center for Media and Democracy.
Wendell Potter has served since May 2009 as CMD's Senior Fellow on Health Care. After a 20-year career as a corporate public relations executive, last year he left his job as head of communications for one of the nation's largest health insurers to try his hand at helping socially responsible organizations -- including those advocating for meaningful health care reform -- achieve their goals.
Before his big switch, Wendell held a variety of positions at CIGNA Corporation over 15 years, serving most recently as head of corporate communications and as the company's chief corporate spokesman.
Prior to joining CIGNA, Wendell headed communications at Humana Inc., another large for-profit health insurer. Before that he was director of public relations and advertising for The Baptist Health System of East Tennessee. He also has been a partner in an Atlanta public relations firm, a press secretary to a Democratic nominee for governor of Tennessee and as a lobbyist in Washington for the organizers of the 1982 World's Fair in Knoxville, Tenn. He also served as a member of the public relations and international marketing team for the Fair and traveled to Europe, Africa and South America on country recruitment missions.
Wendell also was a journalist. His first job after college was as a reporter for Scripps-Howard's afternoon paper in Memphis. He wrote about Memphis businesses and local government before being sent to Nashville to cover the governor's office and state legislature. Two years later he was promoted to the Scripps-Howard News Bureau in Washington where he covered Congress, the White House and the Supreme Court and wrote a weekly political column.
Wendell is a native of Tennessee and a graduate of the University of Tennessee in Knoxville where he received a B.A. degree in communications and did postgraduate work in journalism and public relations. ...
Wendell Potter's blog is here:
UPDATE #3: Potter interview/video on Democracynow.org
Wendell Potter was interviewed by Amy Goodman on the indispensable democracynow.org on 7/16/2009. Please see the entire video clip there, or listen to the interview, or read the entire transcript of which I'm posting an edited part of (it's a VERY long, in-depth interview; please have a look at the whole thing):
AMY GOODMAN: ...we spend the hour today with a former top executive from one of the nation’s largest health insurance companies who has begun exposing some of the industry’s dirty secrets. This whistleblower testified before the Senate Committee on Commerce, Science and Transportation last month.
WENDELL POTTER: My name is Wendell Potter, and for twenty years I worked as a senior executive at health insurance companies. And I saw how they confused their customers and dumped the sick, so all they—so also they can satisfy their Wall Street investors.
AMY GOODMAN: Wendell Potter joins us...
Up until last year he was the head of corporate communications at CIGNA, one of the nation’s largest for-profit health insurance companies. He served as CIGNA’s chief corporate spokesperson. He also once headed communications at Humana, another large for-profit health insurer. In 2007, Wendell Potter helped spearhead the healthcare industry’s campaign against Michael Moore’s movie Sicko.
AMY GOODMAN: So why have you decided to speak out?
WENDELL POTTER: You know, when I left, I left voluntarily. It was a little over a year ago. I just decided I didn’t want to keep doing that. I had no longer felt that what I was doing was the right thing....
AMY GOODMAN: But you were a critical part of that, being in communications and then head of communications at CIGNA.
WENDELL POTTER: I was. I was a person who was often speaking for not just the company, but sometimes the industry. ...So, as a consequence, I know pretty much the game plan that they have developed and used and the talking points that they use....
AMY GOODMAN: ...What is the game plan of the health insurance industry?
WENDELL POTTER: Well, the game plan is based on scare tactics. And, of course, the thing they fear most is that the country will at some point gravitate toward a single-payer plan. That’s the ultimate fear that they have. ...They fear even the public insurance option that’s being proposed, that was part of President Obama’s campaign platform, his healthcare platform. And they’ll pull out all the stops they can to defeat that. And they’ll be working with their ideological allies, with the business community, with conservative pundits and editorial writers, to try to scare people into thinking that embracing a public health insurance option would lead us down the...slippery slope toward socialism and that you will be...putting a government bureaucrat between you and your doctor. ...
AMY GOODMAN: What turned you? Why did you change?
WENDELL POTTER: I changed because over the last two or three years I began seeing more than I’d ever seen before and became more knowledgeable of how health insurance—how health insurance companies make money, how they maximize profits. ...But I also saw how—you know, the things that they do to maximize their profit, which really boils down to dumping the sick.
AMY GOODMAN: What do you mean, "dumping the sick"?
WENDELL POTTER: Two different ways that they do this. In the individual insurance market...Once you file a claim, if you are unfortunate enough to get very sick or have an accident and file a claim, you very often will find that your insurance company will go back and look at your application to see if there might be a chance that you either didn’t disclose something that you knew about in the past or inadvertently didn’t disclose something or might not have known about a pre-existing condition. They’ll use that as evidence that you were committing fraud, and they’ll revoke your policy, or they call it "rescinding" your policy, leaving you holding the bag, making you completely responsible for all the medical bills. ....
Another is, if you are employed, particularly with a small business, and your insurance—your employer gets his or her insurance through one of the large insurers, and if just one person in your company files a claim that the underwriters think is too high, if it skews what they think is the appropriate medical experience or claim experience, when that business comes up for renewal, they very likely will jack up the rates so much that your employer has no alternative but to leave and leave you and all of your coworkers without insurance. Either that or they may cut benefits ... But the end result is, you may find yourself dumped into the rolls and the ranks of the uninsured.
AMY GOODMAN: Was there a seminal moment when you were head of communications at CIGNA that really made you start to look? ...
WENDELL POTTER: I was very isolated, along with most insurance company executives who deal with numbers all the time—profit margins and medical loss ratios and earnings per share and how many millions of members you have, or things like that. It’s just—they’re just numbers. ...I happened to learn about a healthcare expedition that was being held at a nearby town across the state line in Virginia. And I was intrigued, borrowed my dad’s car and drove up to Wise County to see what was going on there. And this expedition was being held at the Wise County fairgrounds, and it was being put on by this group called Remote Area Medical that got its start several years ago taking volunteer doctors from this country to remote villages in South America, where people really don’t have any access to medical care. The founder realized pretty soon, though, that the need in this country is very, very great, and he started holding similar expeditions in rural communities throughout the country. And this one was nearby. I decided to check it out. ...when I walked through the fairground gates, it was just absolutely overwhelming. What I saw were people who were lined up. ...They were lined up in the rain by the hundreds, waiting to get care that was being donated by doctors and nurses and dentists and other caregivers, and they were being treated in animal stalls. Volunteers had come to disinfect the animal stalls. They also had set up tents. It looked like a MASH unit. It looked like this could have been something that was happening in a war-torn country, and war refugees were there to get their care. It was just unbelievable, and it just drove it home to me, maybe for the first time, that we were talking about real human beings and not just numbers.
AMY GOODMAN: ... I asked him whether he felt many of the journalists covering the health insurance industry are acting as PR agents for the industry.
WENDELL POTTER: I do think so, maybe unwittingly in many cases.... But also, just the way the mainstream media’s influence has changed and the—excuse me, the decline in newspaper circulation and just the way that people get their information, that has changed, and that has worked to the favor of people like I used to be—PR professionals and corporate executives. There aren’t as many reporters as there used to be. The so-called news hole isn’t as big as it used to be to have investigative pieces. Reporters ... will just accept a statement that’s given to them from a corporate PR guy, like I used to be, and run with it and think their obligation is done, or just don’t have the time to explore it or do any in-depth stories. So, in that regard, I think they really are unwittingly helping the insurance industry.
AMY GOODMAN: In 2007, CIGNA denied a California teenager, Nataline Sarkisyan, coverage for a liver transplant. Her family went to the media. ...The California Nurses Association joined in. Geri Jenkins is head of the CNA.
GERI JENKINS: It’s just really atrocious that we let decisions be made based on money and not on human life and what’s necessary to keep people alive. The Sarkisyans had insurance. ...They had insurance. They had done everything that was expected of them. They worked hard. They provided insurance. And yet, when they needed it, it wasn’t there for them.
AMY GOODMAN: Under mounting pressure, CIGNA finally granted coverage for the liver transplant. But it was too late. Two hours later, Nataline died.
AMY GOODMAN: Wendell Potter, can you talk about—well, I’m sure this was a challenge for CIGNA—and how you dealt with this story?
WENDELL POTTER: It was a challenge. And frankly, it was probably within a month or so after I first learned of Nataline Sarkisyan that I told the company that I worked for—pardon me—that I had come to the end of my career and had a long run at CIGNA, but it was time for me to go.
It was a very, very difficult time for—I can’t imagine what it was like for the family....
AMY GOODMAN: And how were you feeling at the time?
WENDELL POTTER: Oh, just devastated. I have a daughter myself. ... it was just crushing for me and a lot of people that I worked with at CIGNA, too. ...And certainly, from a public relations point of view, CIGNA really suffered a black eye. And I, as the spokesman for the company... And I was—my name was on the website, and my contact information was on the website, CIGNA’s website, and so people were venting their frustration. I received—I can’t tell you how many emails, how many voicemail messages and calls from people who were just outraged. ...
AMY GOODMAN: I want to stick with the media and the power of the media. You were the point person on Michael Moore’s film Sicko.
WENDELL POTTER: I was.
AMY GOODMAN: Talk about what happened and how you organized against his film...
WENDELL POTTER: Well, frankly, I was very conflicted, because when I saw the movie for the first time...I knew it was an honest film...But the industry knew, from the moment that we heard that Michael Moore was going to be doing a film, a documentary, on the health insurance industry, that—or not just the health insurance industry, but the whole American healthcare system, that undoubtedly the American insurance system would not fare too well. And so, over the course of many months leading up to the premier of the movie, the industry was very active in trying to figure out how to blunt the impact of the movie when it did premier and was very careful to avoid any memos being written that had Michael Moore’s name or Sicko in the subject line, because there was this great fear that it would be leaked to Michael Moore, and he would use it as part of his publicity campaign. Apparently, such a memo was leaked from one of the pharmaceutical companies, and he used it to great advantage. So all of the memos would have the subject line "Hollywood," and all the conversations would be on very secretive conference calls.
And then, when the movie was about to premier, the industry—it was premiered, as you may remember, in Cannes at the film festival in 2007, and the industry, through some connections that it had in the entertainment business, was able to fly someone to France to get a ticket and to sit in the theater during the first screening of the movie.... And that gave the companies some time to prepare, to develop talking points to counteract the ultimate questions, the inevitable questions that would be asked when the movie was beginning to premier in the United States.
AMY GOODMAN: And what were the buzzwords, the talking points, that you developed...
WENDELL POTTER: ... Number one, with regards to Michael Moore himself, they knew that he could be a polarizing figure and that conservatives don’t like him, so they—the industry—part of the industry strategy was to recruit conservative pundits and editorial writers and members of Congress who were conservative and aligned with the industry’s agenda and point of view. And we would do media training with all of our executives, because there was the expectation that Moore would do ambush interviews, as he has done in some of his previous films. That didn’t happen, but if they had, we had our executives well trained with how to handle such an interview. We referred to him—we were prepared to refer to him in any interviews we did have as Michael Moore the movie maker, the entertainer, in an effort to diminish his importance as a documentary maker, to try to cast him as part of the Hollywood establishment and someone who was really making a fantasy, rather than a documentary. ...
The other was to use the subject of what he was doing, which was—you know, as you may recall, he went to many different countries that have universal care, including Canada, the United Kingdom, France, and even Cuba, and some other places, to show how people can get care and have much better access to care than in the United States. The industry saw this certainly as a threat. They didn’t like seeing those countries’ healthcare systems depicted in a positive light, because they’d been fighting that kind of a system for many years. So the talking points were to demean a single-payer system or a government-run system. Government-run—whenever you hear someone who’s allied with the industry talk about a government-run system, they’ll use the term pejoratively, and they’ll say that it will put us on the slippery slope toward socialism, or it will put a government bureaucrat between you and your doctor....
AMY GOODMAN: Can you talk about the way the Senate now is dealing with healthcare, and Congress overall, and the power that the health insurance industry has over these politicians? I mean, you have people like Senator Max Baucus, who gets more money perhaps than anyone in the Senate from the health insurance, hospital, healthcare industry, and he’s head of the Senate Finance Committee. ...
WENDELL POTTER: Well, one thing to remember is that the health insurance industry has been anticipating this debate on healthcare reform for many years. They knew it was inevitable that it would come back. And they knew that if a Democrat were elected president, undoubtedly it would be on the top of the political agenda. So they’ve been positioning themselves to get very close to influential members of Congress in both parties, and Max Baucus is certainly someone they knew, a long time ago, was going to be critical for their interests. So, yes, they—the insurance industry, the pharmaceutical industry and others in healthcare—have spent, have donated lots and lots, millions of dollars, to his campaigns over the past few years.
But aside from money, it’s relationships that count. And that’s why the insurance industry has hired scores and scores of lobbyists, many of whom have worked for members of Congress and some who are former members of Congress, to lobby on their behalf. Some of Max Baucus’s former staff members work for—in the health insurance industry as lobbyists these days. That is very important. It helps to open the door, and it enables people who are aligned with the industry, who have good associations or close associations with members of Congress, to pass along the talking points or to express the industry’s points of view.
For example, one of the companies hired a very influential lobbyist who has connections on the Democratic side. And one of the things that the industry has been doing is engaging in what’s referred to as "grasstops lobbying." And that means the top executives go to Washington and meet with members of Congress and try to persuade them, or at least make them see, that they don’t have two heads and that they’re reasonable people, and you should listen to us.... And most people can’t imagine having that kind of access or that kind of entree to the power and leadership on Capitol Hill.
AMY GOODMAN: Was that when you were working for CIGNA?
WENDELL POTTER: It was... And one of the industry’s lobbyists is Heather Podesta. Heather has her own company now. She used to be with another big firm called Blank Rome, which also is doing a significant amount of lobbying. But her husband is Tony Podesta. They are a power couple in Washington, if there ever was one. Tony is John Podesta’s brother. And they, themselves, have contributed thousands and thousands of dollars to candidates over the past several years. So, having someone like that on your team makes a huge difference in being able to get the foot in the door and to present your points of view.
AMY GOODMAN: Well, what about that, Tony’s brother being John Podesta, who is seminal for the shaping of Obama policy, and the people who are—most significantly, the people who are put into the Obama administration? What is your understanding of how much influence he has on his brother?
WENDELL POTTER: You know, I don’t know... But I think it would be—it’s something that I think would be appropriate for the media to take a look at it and just to do stories about the connections in Washington and how the insurance industry and others who have gained so much power and influence shape legislation, as it very likely will be shaping healthcare reform legislation this time.
AMY GOODMAN: The Washington Post recently had a piece about the nation’s healthcare industry hiring more than 350 former government officials and members of Congress to sway healthcare reform on Capitol Hill. According to lobbying records, three out of every four major healthcare companies have at least one former government insider on the payroll. Nearly half held positions under key committees and lawmakers, including Senators Max Baucus, as you mentioned, and Charles Grassley. Baucus, chair of the Senate Finance Committee, of course, which is largely steering healthcare reform. Baucus’s aides, as you mentioned, recently held a meeting with a group of lobbyists that included two of his former chiefs of staff. The Washington Post says the healthcare industry is now spending $1.4 million a day on lobbying, totaling $126 million in the first fiscal quarter... Wendell?
WENDELL POTTER: ...there’s no doubt that the money that insurance companies have to do their lobbying comes from premium income. One thing that people, I think, need to understand, that I’ve been talking about as part of my testimony, was how less and less of a person’s premium dollar is being spent actually to cover claims these days. Back when Bill Clinton was president and he and Hillary Clinton were trying to reform the healthcare system, back in 1993, 95—on the average, 95 cents of every premium dollar was being spent to pay claims. Last year, it was down to just around 80 cents. ...
AMY GOODMAN: What do you think of single payer? And first, explain it, as you understand it. ...
WENDELL POTTER: Yeah, I think one of the ways for people to understand how a single-payer system works is to look at our Medicare program, which is a single-payer program. The government runs the program. So we have a very popular government-run program in this country, and have since the 1960s. And it has been—it has made enormous difference in the lives of people who are elderly and disabled. And, in fact, the satisfaction ratings of people who are enrolled in Medicare—and these are people who are elderly and disabled, who have a much greater chance of needing care than people who are younger and who are enrolled in private plans...
In Canada, their system there is called Medicare, and it is a system that essentially has taken our Medicare program and expanded it to include or be available to all their citizens. And in Canada—it’s probably the ultimate single-payer system—there are no private insurance companies that compete for business. ...
But even in a single-payer system like in Canada and our own Medicare system, the care is delivered by the private sector, by doctors and nurses who are in private practice and by private hospitals. So it is not a government takeover, as some in the industry and its allies would like us to believe. It is not a government takeover of the healthcare system, by any means. In a single-payer system, doctors and nurses and hospitals deliver the care. And people have a broad choice; they’re not restricted to certain doctors and nurses and hospitals.
AMY GOODMAN: Are you for single-payer healthcare in this country?
WENDELL POTTER: It works in Canada. ...people are much happier with their system there than Americans are here. ...if you take into consideration the people who—the number of people who are underinsured now—and that is a number that is growing because of the new health plans that are being sold, these so-called consumer-directed plans that are really high-deductible plans—when you add those people in, there are more people who are either uninsured or underinsured than the entire population of the United Kingdom. So, you know, we are at a point where some fundamental reform is absolutely necessary...
AMY GOODMAN: Should there be for-profit health insurance companies in this country?
WENDELL POTTER: You know, interesting. One of the big champions of the so-called consumer-directed plans is a woman named Regina Herzlinger. She’s a professor at Harvard... She often talks about the Swiss system as something that the US might look at as a model... They do have private insurance companies that operate there. The interesting thing is that she doesn’t mention too much, or at all, for that matter, is that while there are insurance companies that operate there, for-profit insurance companies are illegal in Switzerland, and they are very highly regulated. And they all have to offer standard benefit plans. And so, there’s nothing like the kind of system that we have here.
AMY GOODMAN: And finally, as the push for healthcare reform continues, it looks like President Obama is having a mutiny within his own party... And what advice would you give to them right now, when you have a population that’s overwhelmingly for a public plan, if not single payer, and a filibuster-proof Democratic majority in the Senate?
WENDELL POTTER: I think it would be absolutely disastrous for the administration to even consider signing legislation that doesn’t include a strong public plan. ... I think many, many people voted for Barack Obama because of his healthcare platform and the things that he said he felt were vital in terms of reform. The inclusion of a public insurance plan is paramount...I would hope that people who voted for him and people who are uninsured, who are underinsured, will make sure that he understands that.
UPDATE #4: Potter testimony before Senate.
Taken with sourcing below from Huffington Post. Since this is a matter of "public record" (congressional testimony) no need to edit it:
Thank you Madam Speaker for the opportunity to address the House Steering and Policy Committee. Madam Speaker and Members of the Committee, my name is Wendell Potter, and I am humbled to be here today to testify about the need for meaningful and comprehensive reform and about the efforts of an industry I worked in for many years to shape reform in ways that will benefit it at the expense of taxpayers and policyholders.
In the weeks since my June 24 testimony before the U.S. Senate Committee on Commerce, Science and Transportation, I have expressed hope at every opportunity that this indeed might be the year Congress will enact legislation to reform our health care system in ways that will truly benefit Americans for generations to come.
But I have also expressed concern that if Congress goes along with the so-called "solutions" the insurance industry says it is bringing to the table and acquiesces to the demands it is making of lawmakers, and if it fails to create a public insurance option to compete with private insurers, the bill it sends to the president might as well be called the Insurance Industry Profit Protection and Enhancement Act.
H.R. 3200, America's Affordable Health Choices Act of 2009, encompasses a comprehensive set of reforms that address the critical need for expanded coverage, lower health care costs, and greater choice and quality. Other legislative proposals, including the "Baucus Framework" being considered by the Senate Finance Committee's "Bipartisan Six," would benefit health insurance companies far more than average Americans.
The practices of the insurance industry over the past several years have contributed directly to the growing number of Americans who are uninsured and the even more rapidly growing number of people who are underinsured.
H.R. 3200 would go a long way toward making many of the standard practices of the industry illegal while providing much-needed assistance to low and moderate income Americans who cannot afford the overpriced premiums being charged by the cartel of large for-profit insurance companies that now dominate the industry.
H.R. 3200 would provide premium and cost-sharing assistance through the Health Insurance Exchange it would create. It would require the Secretary of Health and Human Services to establish a defined package of "essential health services" that all plans, public or private, would have to cover.
It also would prohibit insurance companies from denying coverage or basing premiums on pre-existing conditions, gender or occupation. It would eliminate deductibles or co-pays for preventive care as well as the lifetime limits currently common in health insurance policies. The bill also would set an annual cap on out-of-pocket expenses that is more reasonable than in other proposals.
As important if not more important than those market reforms, H.R. 3200 would also create a public insurance option to compete with private insurers. Contrary to the misinformation being disseminated by the health insurance industry and its allies, the public insurance option would not have a competitive advantage over private plans. It would have to meet the same benefit requirements and comply with the same insurance market reforms as private plans.
As I told Members of the Senate Committee on Commerce, Science and Transportation, insurance companies routinely dump policyholders who are less profitable or who get sick as part of their never-ending quest to meet Wall Street's relentless profit expectations.
While the reforms proposed in various bills before Congress would seemingly restrict insurance companies' ability to put investors' needs over those of consumers, Members must realize that provisions of some proposals, including the Baucus Framework, would actually drive millions more Americans, including many who currently have access to comprehensive coverage, into the ranks of the underinsured.
An estimated 25 million Americans are now underinsured for two principle reasons. First, the high-deductible plans many of them have been forced into by their employers require them to pay more out of their own pockets for medical care, whether they can afford it or note. Second, more and more Americans have fallen victim to deceptive marketing practices and bought what essentially is fake insurance.
The insurance industry is insistent on being able to retain what it calls "benefit design flexibility." Those three words seem innocuous and reasonable, but if legislation that reaches the president grants insurers the flexibility they claim they must have, and requires all of us to buy coverage from them, millions more of us will have little alternative but to buy policies that appear to be affordable but which will be prove to be anything but affordable if we become seriously ill or injured.
The big insurers have spent millions of dollars acquiring companies that specialize in what they call "limited-benefit" plans. Not only are the benefits extremely limited, the underwriting criteria established by the insurers essentially guarantee big profits.
H.R. 3200 would ban the worst of these policies. Other proposals, by providing financial incentives for employers to offer barebones plans with lousy benefits and high deductibles, would actually encourage them.
Unlike H.R. 3200, those proposals would not require employers to provide good benefits or even to meet minimum benefit standards. They also would permit employers to saddle their workers with the entire amount of the premiums in addition to the high out-of-pocket expenses, escalating the already rapid shift of the financial burden of health care from insurers and employers to working men and women.
The Baucus plan also would allow insurers to charge older people and families up to 7.5 times as much and younger people, impose big fines on families that don't buy their lousy insurance, and would weaken state regulation of insurers.
As a consequence, these proposals would do little to increase affordable coverage for those currently insured, or stop the rise in medical bankruptcy. They would, however, ensure that a huge new stream of revenue--much of it from taxpayers who would finance the needed subsidies for people too poor to buy coverage on their own--would flow--"gush" might be a more appropriate word--to insurance companies. And much of that new revenue would ultimately go right into the pockets of the Wall Street investors who own them.
Over the past several weeks, I have repeatedly told audiences around the country that the public option should not just be an "option" to be bargained away at the behest of insurance companies who are pouring money into Congress to defeat substantial and essential reforms. A public option must be created to provide true choice to consumers or reform will fail to truly fix the root of the severe problems that have been caused in large part by the greedy demands of Wall Street.
By creating a strong public option and restricting the insurance industry's ability to enrich executives and investors at the expense of taxpayers and consumers, H.R. 3200 will truly benefit average Americans.
The Baucus plan, on the other hand, would create a government-subsidized monopoly for the purchase of bare-bones, high-deductible policies that would truly benefit Big Insurance. In other words, insurers would win; your constituents would lose.
It's hard to imagine how insurance companies could write legislation that would benefit them more.
Over the coming weeks, I implore each Member of Congress to put the interests of ordinary, extraordinary Americans--the people who hired you with their votes--above those of private health insurers and others who view reform as a way to make more money.
Thank you for considering my views.