wendell potter continues to speak out, and americans must listen

Remember Wendell Potter? He's the former head of corporate communications (i.e., PR) for Cigna, the fourth largest insurer in the US, and he's been speaking openly about the dirty tricks the insurance industry employs to deny coverage to paying customers. I blogged about him here; if you missed it, you might want to check it out.

Potter is still speaking out. He sat down with the great progressive journalist-activist Bill Moyers. You can watch their conversation or read a transcript here.

Through Moyers, Potter makes it very clear he is not a disgruntled former employee bad-mouthing a company that wronged him. He is a man wracked by conscience, and determined to speak the truth. Here's an excerpt.

WENDELL POTTER: Well, I was beginning to question what I was doing as the industry shifted from selling primarily managed care plans, to what they refer to as consumer-driven plans. And they're really plans that have very high deductibles, meaning that they're shifting a lot of the cost off health care from employers and insurers, insurance companies, to individuals. And a lot of people can't even afford to make their co-payments when they go get care, as a result of this. But it really took a trip back home to Tennessee for me to see exactly what is happening to so many Americans. I--

BILL MOYERS: When was this?

WENDELL POTTER: This was in July of 2007.

BILL MOYERS: You were still working for Cigna?

WENDELL POTTER: I was. I went home, to visit relatives. And I picked up the local newspaper and I saw that a health care expedition was being held a few miles up the road, in Wise, Virginia. And I was intrigued.

BILL MOYERS: So you drove there?

WENDELL POTTER: I did. I borrowed my dad's car and drove up 50 miles up the road to Wise, Virginia. It was being held at a Wise County Fairground. I took my camera. I took some pictures. It was a very cloudy, misty day, it was raining that day, and I walked through the fairground gates. And I didn't know what to expect. I just assumed that it would be, you know, like a health-- booths set up and people just getting their blood pressure checked and things like that.

But what I saw were doctors who were set up to provide care in animal stalls. Or they'd erected tents, to care for people. I mean, there was no privacy. In some cases-- and I've got some pictures of people being treated on gurneys, on rain-soaked pavement.

And I saw people lined up, standing in line or sitting in these long, long lines, waiting to get care. People drove from South Carolina and Georgia and Kentucky, Tennessee-- all over the region, because they knew that this was being done. A lot of them heard about it from word of mouth.

There could have been people and probably were people that I had grown up with. They could have been people who grew up at the house down the road, in the house down the road from me. And that made it real to me.

BILL MOYERS: What did you think?

WENDELL POTTER: It was absolutely stunning. It was like being hit by lightning. It was almost-- what country am I in? I just it just didn't seem to be a possibility that I was in the United States. It was like a lightning bolt had hit me.

BILL MOYERS: People are going to say, "How can Wendell Potter sit here and say he was just finding out that there were a lot of Americans who didn't have adequate insurance and needed health care? He'd been in the industry for over 15 years."

WENDELL POTTER: And that was my problem. I had been in the industry and I'd risen up in the ranks. And I had a great job. And I had a terrific office in a high-rise building in Philadelphia. I was insulated. I didn't really see what was going on. I saw the data. I knew that 47 million people were uninsured, but I didn't put faces with that number.

Just a few weeks later though, I was back in Philadelphia and I would often fly on a corporate aircraft to go to meetings.

And I just thought that was a great way to travel. It is a great way to travel. You're sitting in a luxurious corporate jet, leather seats, very spacious. And I was served my lunch by a flight attendant who brought my lunch on a gold-rimmed plate. And she handed me gold-plated silverware to eat it with. And then I remembered the people that I had seen in Wise County. Undoubtedly, they had no idea that this went on, at the corporate levels of health insurance companies.

BILL MOYERS: But you had, all these years, seen premiums rising. People purged from the rolls, people who couldn't afford the health care that Cigna and other companies were offering. This is the first time you came face to face with it?

WENDELL POTTER: Yeah, it was. You know, certainly, I knew people, and I talked to people who were uninsured. But when you're in the executive offices, when you're getting prepared for a call with an analyst, in the financial medium, what you think about are the numbers. 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. That's what you think about, at that level. And it helps to think that way. That's why you-- that enables you to stay there, if you don't really think that you're talking about and dealing with real human beings.

BILL MOYERS: Did you go back to corporate headquarters and tell them what you had seen?

WENDELL POTTER: I went back to corporate headquarters. I was trying to process all this, and trying to figure out what I should do. I did tell many of them about the experience I had. And the trip. I showed them some pictures I took while I was down there. But I didn't know exactly what I should do.

You know, I had bills of my own. And it was hard to just figure out. How do I step away from this? What do I do? And this was one of those things that made me decide, "Okay, I can't do this. I can't keep-- I can't." One of the books I read as I was trying to make up my mind here was President Kennedy's "Profiles in Courage."

And in the forward, Robert Kennedy said that one of the president's, one of his favorite quotes was a Dante quote that, "The hottest places in hell are reserved for those who, in times of moral crisis, maintain a neutrality." And when I read that, I said, "Oh, jeez, I-- you know. I'm headed for that hottest place in hell, unless I say something."

I really admire this man. I've always been on this side of the fence. I never had to choose between comfort and sacrifice to speak out. What he did isn't easy: it requires a working moral compass, and a good supply of moral courage. Looking around us at the world of corporate profit and the governments that support it, it's clear these qualities are not in large supply.

As activists, as progressive people, we should support the journey of anyone who makes a choice to fight the good fight.

Here's more.

BILL MOYERS: You were also involved in the campaign by the industry to discredit Michael Moore and his film "Sicko" in 2007. In that film Moore went to several countries around the world, and reported that their health care system was better than our health care system, in particular, Canada and England. Take a look at this.

. . . . [clip from "Sicko"]

BILL MOYERS: We obtained a copy of the game plan that was adopted by the industry's trade association, AHIP. And it spells out the industry strategies in gold letters. It says, "Highlight horror stories of government-run systems." What was that about?

[Note: You can download the documents by clicking here and here (PDFs)]

WENDELL POTTER: The industry has always tried to make Americans think that government-run systems are the worst thing that could possibly happen to them, that if you even consider that, you're heading down on the slippery slope towards socialism. So they have used scare tactics for years and years and years, to keep that from happening. If there were a broader program like our Medicare program, it could potentially reduce the profits of these big companies. So that is their biggest concern.

BILL MOYERS: And there was a political strategy. "Position Sicko as a threat to Democrats' larger agenda." What does that mean?

WENDELL POTTER: That means that part of the effort to discredit this film was to use lobbyists and their own staff to go onto Capitol Hill and say, "Look, you don't want to believe this movie. You don't want to talk about it. You don't want to endorse it. And if you do, we can make things tough for you."

BILL MOYERS: How?

WENDELL POTTER: By running ads, commercials in your home district when you're running for reelection, not contributing to your campaigns again, or contributing to your competitor.

BILL MOYERS: This is fascinating. You know, "Build awareness among centrist Democratic policy organizations--"

WENDELL POTTER: Right.

BILL MOYERS: "--including the Democratic Leadership Council."

WENDELL POTTER: Absolutely.

BILL MOYERS: Then it says, "Message to Democratic insiders. Embracing Moore is one-way ticket back to minority party status."

. . .

WENDELL POTTER: In memos that would go back within the industry — he was never, by the way, mentioned by name in any memos, because we didn't want to inadvertently write something that would wind up in his hands. So the memos would usually-- the subject line would be-- the emails would be, "Hollywood." And as we would do the media training, we would always have someone refer to him as Hollywood entertainer or Hollywood moviemaker Michael Moore.

BILL MOYERS: Why?

WENDELL POTTER: Well, just to-- Hollywood, I think people think that's entertainment, that's movie-making. That's not real documentary. They don't want you to think that it was a documentary that had some truth. They would want you to see this as just some fantasy that a Hollywood filmmaker had come up with. That's part of the strategy.

. . . .

BILL MOYERS: I have a memo, from Frank Luntz. I have a memo written by Frank Luntz. He's the Republican strategist who we discovered, in the spring, has written the script for opponents of health care reform. "First," he says, "you have to pretend to support it. Then use phrases like, "government takeover," "delayed care is denied care," "consequences of rationing," "bureaucrats, not doctors prescribing medicine."

. . . .

BILL MOYERS: Back in 1993, the Republican propagandist, William Kristol, urged his party to block any health care proposal, in order to prevent the Democrats from being seen as the quote, "generous protector of the middle class." But today, you've got some Democrats who are going along with the industry.

Max Baucus, the senator from Montana, for example, the most important figure right now in this health care legislation that's being written in the Senate. He's resisted including a public insurance option in the reform bill, right?

WENDELL POTTER: That's right.

BILL MOYERS: Why is the industry so powerful on both sides of the aisle?

WENDELL POTTER: Well, money and relationships, ideology. The relationships-- an insurance company can hire and does hire many different lobbying firms. And they hire firms that are predominantly Republican and predominantly Democrat. And they do this because they know they need to reach influential members of Congress like Max Baucus. So there are people who used to work for Max Baucus who are in lobbying firms or on the staff of companies like Cigna or the association itself.

. . . .

BILL MOYERS: Why is public insurance, a public option, so fiercely opposed by the industry?

WENDELL POTTER: The industry doesn't want to have any competitor. In fact, over the course of the last few years, has been shrinking the number of competitors through a lot of acquisitions and mergers. So first of all, they don't want any more competition period. They certainly don't want it from a government plan that might be operating more efficiently than they are, that they operate. The Medicare program that we have here is a government-run program that has administrative expenses that are like three percent or so.

BILL MOYERS: Compared to the industry's--

WENDELL POTTER: They spend about 20 cents of every premium dollar on overhead, which is administrative expense or profit. So they don't want to compete against a more efficient competitor.

BILL MOYERS: You told Congress that the industry has hijacked our health care system and turned it into a giant ATM for Wall Street. You said, "I saw how they confuse their customers and dump the sick, all so they can satisfy their Wall Street investors." How do they satisfy their Wall Street investors?

WENDELL POTTER: Well, there's a measure of profitability that investors look to, and it's called a medical loss ratio. And it's unique to the health insurance industry. And by medical loss ratio, I mean that it's a measure that tells investors or anyone else how much of a premium dollar is used by the insurance company to actually pay medical claims. And that has been shrinking, over the years, since the industry's been dominated by, or become dominated by for-profit insurance companies. Back in the early '90s, or back during the time that the Clinton plan was being debated, 95 cents out of every dollar was sent, you know, on average was used by the insurance companies to pay claims. Last year, it was down to just slightly above 80 percent.

So, investors want that to keep shrinking. And if they see that an insurance company has not done what they think meets their expectations with the medical loss ratio, they'll punish them. Investors will start leaving in droves.

I've seen a company stock price fall 20 percent in a single day, when it did not meet Wall Street's expectations with this medical loss ratio.

For example, if one company's medical loss ratio was 77.9 percent, for example, in one quarter, and the next quarter, it was 78.2 percent. It seems like a small movement. But investors will think that's ridiculous. And it's horrible.

BILL MOYERS: That they're spending more money for medical claims.

WENDELL POTTER: Yeah.

BILL MOYERS: And less money on profits?

WENDELL POTTER: Exactly. And they think that this company has not done a good job of managing medical expenses. It has not denied enough claims. It has not kicked enough people off the rolls. And that's what-- that is what happens, what these companies do, to make sure that they satisfy Wall Street's expectations with the medical loss ratio.

BILL MOYERS: And they do what to make sure that they keep diminishing the medical loss ratio?

WENDELL POTTER: Rescission is one thing. Denying claims is another. Being, you know, really careful as they review claims, particularly for things like liver transplants, to make sure, from their point of view, that it really is medically necessary and not experimental. That's one thing. And that was that issue in the Nataline Sarkisyan case.

But another way is to purge employer accounts, that-- if a small business has an employee, for example, who suddenly has have a lot of treatment, or is in an accident. And medical bills are piling up, and this employee is filing claims with the insurance company. That'll be noticed by the insurance company.

And when that business is up for renewal, and it typically is up, once a year, up for renewal, the underwriters will look at that. And they'll say, "We need to jack up the rates here, because the experience was," when I say experience, the claim experience, the number of claims filed was more than we anticipated. So we need to jack up the price. Jack up the premiums. Often they'll do this, knowing that the employer will have no alternative but to leave. And that happens all the time.

They'll resort to things like the rescissions that we saw earlier. Or dumping, actually dumping employer groups from the rolls. So the more of my premium that goes to my health claims, pays for my medical coverage, the less money the company makes.

No matter what states like Massachusetts rig up for their uninsured residents, no matter what schemes are advanced to include more people on private policies, until the profit motive is removed, no health care system will ever work. As long as the private insurers are involved, there can be no meaningful reform.

Read or watch the full interview here, and spread it around.

Many thanks to James, via BoingBoing.