“They Dump the Sick to Satisfy Investors”:
Insurance Exec Turned Whistleblower Wendell Potter Speaks Out Against Healthcare Industryhttp://www.democracynow.org/2009/7/16/former_insurance_exec_wendell_porterAs the debate over healthcare reform intensifies on Capitol Hill, we spend the hour with a former top insurance executive who’s now exposing the industry’s dirty secrets. Wendell Potter once served as the head of corporate communications at CIGNA, one of the nation’s largest health insurance companies. We speak to Potter about his own transformation from industry mouthpiece to whistleblower, the healthcare industry’s extensive PR and lobbying machine, the campaign to discredit Michael Moore’s film Sicko, and the insurance industry’s most pressing task: the fight against a public option, let alone a single-payer system.
WENDELL POTTER: I worked for CIGNA for fifteen years, and I was a spokesman or spokesperson for CIGNA for all of that time, and probably the last four or five years I was the head of corporate communications and also the chief spokesman for the company.
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. But I didn’t decide to start speaking out until just earlier this year, when I started seeing the evidence that the insurance industry’s PR and lobbying campaigns were apparently paying off, like they did in the early ’90s when they were leading the effort to kill the Clinton plan, and how they’ve killed every meaningful healthcare reform initiative since then.
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. I spent a lot of time working with my colleagues at other companies on task forces and trade association committees to help develop the strategy and the tactics. So, yes, I did a lot of that. So, as a consequence, I know pretty much the game plan that they have developed and used and the talking points that they use and send out to people who they think will say the things they want them to say.
AMY GOODMAN: And what are those talking points? 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. But currently—and they know that right now that is not something that’s on the legislative table. And they’ve been very successful in making sure that it isn’t. 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—excuse me, slippery slope toward socialism and that you will be, in essence, putting a government bureaucrat between you and your doctor. That is—you know, they’ve used those talking points for years, and in years past they’ve always worked.
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.
The companies that I worked for were two of the biggest for-profit health insurance companies. And over the past fifteen years, since the last time we had this debate, the health insurance industry has consolidated to the point that now there are about seven very large for-profit health insurance companies that dominate the market.
They have begun shifting their business model away from managed care, which, frankly, I used to think was a great model, a great concept, for the delivery of healthcare. But they’ve moved—they’re moving away from that to what they refer to as consumer-driven or consumer-directed care, and it really is just a euphemism for shifting the financial burden from insurers and employers onto the shoulders of working men and women. I saw that happening. 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, we’ve seen quite a bit of news coverage, especially in California. When insurance companies who are active in the individual market—and this means when you don’t get your insurance coverage through your workplace, about the only option you have is to buy it directly from an insurance company, and usually it’s much more costly than it is through—if you buy it or get it through your employer. 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. That’s one way that they dump people who need insurance the most.
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 or try to shop for coverage somewhere else. 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? And how were you isolated there from, well, most people in the country, you know, who were increasingly talking about the massive problems of healthcare and access to it and being cutting off, the dumping of the sick, as you put it?
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. And I didn’t really associate that with real people as much as I should and as much as most insurance company executives should, until I went to visit my relatives in Tennessee.
And while I was there, 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.
I didn’t have any idea what to expect, but when I walked through the fairground gates, it was just absolutely overwhelming. What I saw were people who were lined up. It was raining that day. 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: And so, what did you do with that?
WENDELL POTTER: Well, it took me a while to just really process it. I came back to work. I knew at that time that I couldn’t continue doing what I was doing. It just didn’t seem like it was ethically the right thing for me to do. My first career, I was a journalist, and I had been in PR, though, for many years. And I came to realize that much of what I was doing now—or then—in my PR career was just the opposite of what I was trying to do as a journalist. But still, you know, I had mortgage payments. I had other bills to pay. And it was just—it was difficult to work through this and figure out what do I do and how do I—what do I do next?
But then, you know, just two or three weeks later, I was having to fly to a meeting, and I often would fly on one of the corporate jets. And while I was doing that, I was served my lunch on a gold-rimmed plate, was given gold-plated flatware to eat my lunch. I was sitting in a very spacious and luxurious leather chair. And it just dawned on me for the first time. I had done this many times. But because of the Wise County experience, I just realized for the first time that someone’s premiums were helping me to travel that way and were paying for my lunch on gold-trimmed china. And then I thought about those men and women that I had seen in Wise County, undoubtedly not having any idea that this is the way that insurance executives lived and how premium dollars were being spent. And that got me closer to making an ultimate decision that I had to leave.
AMY GOODMAN: Wendell Potter, the former chief spokesperson for the health insurance giant CIGNA. We’ll come back to this wide-ranging conversation in a minute.
AMY GOODMAN: We return to my conversation with the former health insurance executive Wendell Potter. He was the former head of corporate communications at the insurance giant CIGNA, now a fellow at the Center for Media and Democracy. 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, and probably mostly unwittingly. 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 who are still there are much busier, I think, than reporters were when I was there, and I was very busy. I think that they too often, or more often than they should, 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: Can you think of an example of when you told a reporter something that you felt was not true, and that reporter did not investigate further?
WENDELL POTTER: Two or three things. I think insurance companies and, well, anyone can—one of my favorite textbooks when I was in college was How to Lie with Statistics, and I think that we in PR often will throw statistics out that are true to a certain extent but are also misleading and don’t disclose the full story. That is what, more often than not, was what I was doing. I don’t recall intentionally or knowingly lying to a reporter; I wouldn’t have done that. But I think there are times when by withholding all the information or providing selective information or data, you definitely are misleading. And that’s what I did more often than not.
AMY GOODMAN: Can you give us an example?
WENDELL POTTER: One of the things you’ll see that insurance companies are doing these days, they do their own surveys of members. And one of the objectives they have right now is to try to persuade people that these consumer-directed plans are really popular with their customers and with the membership that they have. And the other data that we see that’s done by non-affiliated organizations show that people really don’t like these consumer-directed plans and are concerned about the cost shifting that is going on. But the insurance companies do their own surveying of their members, and they will—they’ll send out news releases with selective data about certain responses to certain questions, without disclosing the questions they ask or much of the methodology that they use. And as a consequence, they’re painting a picture that really is not necessarily the full picture. And I think that that’s an example. That’s one of the things I think people need to be very aware of and that journalists need to be very aware of, of the techniques that corporate PR people use to influence public opinion.
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