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Insurance Industry Whistleblower Wendell Potter: ‘Americans Need To Be Alert’

Posted on by Karina

Today, Rules Chair Louise Slaughter met and held a press conference with Wendell Potter, a former CIGNA Vice President who left the insurance industry after a 20 year career. Potter has since become a whistleblower, testifying before a Senate committee in June about insurance company practices such as hiking up premiums for small businesses and cutting people's coverage off altogether if they make minor mistakes or omissions in their application paperwork.

Louise Slaughter and Wendell Potter

At today’s press conference, Wendell Potter talked about the insurance industry “dirty tricks” Americans can expect to see as America’s Affordable Health Choices Act moves through Congress, including “industry-funded front groups” and “scare tactics.” Potter explained:

The industry has conducted duplicitous and well-financed PR and lobbying campaigns every time Congress has tried to reform our health care system–and how its current behind-scenes-efforts may well shape reform in a way that benefits Wall Street far more than average Americans. I noted that, just as they did 15 years ago when the insurance industry led the effort to kill the Clinton reform plan, it is using shills and front groups to spread lies and disinformation to scare Americans away from the very reform that would benefit them most. Make no mistake, the industry, despite its public assurances to be good-faith partners with the President and Congress, has been at work for months laying the groundwork for devious and often sinister campaigns to manipulate public opinion.

The industry goes to great lengths to keep its involvement in these campaigns hidden from public view. I know from having served on numerous trade group committees and industry-funded front groups, however, that industry leaders are always full partners in developing strategies to derail any reform that might interfere with insurers' ability to increase profits.

…With this history, you can rest assured that the insurance industry is up to the same dirty tricks, using the same devious PR practices it has used for many years, to kill reform this year, or even better, to shape it so that it benefits insurance companies and their Wall Street investors far more than average Americans.

Potter also discussed the tactics that the insurance industry will use to scare us:

Americans and the media need to pay close attention to the efforts insurers and their ideological buddies will undertake…they must realize that every time they hear that by creating a public insurance option, we will be heading down “the slippery slope toward socialism,” some insurance flack like I used to be wrote that, too.

Every time you hear about the shortcomings of what they call “government-run” health care, remember this: what we have now in this country, and what the insurers are determined to keep in place, is Wall Street-run health care. And know that for all practical purposes we already have one of the most insidious means of rationing care in the world–not by people we can hold accountable on election day but by insurance company accountants, underwriters and executives who are held accountable by a few wealthy investors and hedge fund managers who care far more about earnings per share than your health and well-being.

Chair Louise Slaughter concluded:

The industry has a vested interest in the status quo and protecting its profit margin. This is just what they did in 1993 the last time we tried to reform health care. The public must be aware that the industry is not going to willingly change the way it does things and I hope the public understands what's at stake. As Wendell Potter said, these insurance companies do what's good for Wall Street, not main street.

Watch video highlights of today’s press conference:

Wendell Potter’s full remarks:

My name is Wendell Potter and for 20 years, I worked as a senior executive at health insurance companies, and I saw how they confuse their customers and dump the sick — all so they can satisfy their Wall Street investors.

That is how I introduced myself when I testified before the Senate Commerce Committee in late June about the dishonesty of the insurance industry. I described how insurers make promises they have no intention of keeping, how they flout regulations designed to protect consumers, and how they make it nearly impossible to understand–or even to obtain–information consumers need.

I also told the Committee how the industry has conducted duplicitous and well-financed PR and lobbying campaigns every time Congress has tried to reform our health care system–and how its current behind-scenes-efforts may well shape reform in a way that benefits Wall Street far more than average Americans. I noted that, just as they did 15 years ago when the insurance industry led the effort to kill the Clinton reform plan, it is using shills and front groups to spread lies and disinformation to scare Americans away from the very reform that would benefit them most. Make no mistake, the industry, despite its public assurances to be good-faith partners with the President and Congress, has been at work for months laying the groundwork for devious and often sinister campaigns to manipulate public opinion.

The industry goes to great lengths to keep its involvement in these campaigns hidden from public view. I know from having served on numerous trade group committees and industry-funded front groups, however, that industry leaders are always full partners in developing strategies to derail any reform that might interfere with insurers' ability to increase profits.

My involvement in these groups goes back to the early '90s when insurers joined with other special interests to finance the activities of the Healthcare Leadership Council, which led a coordinated effort to scare Americans and members of Congress away from the Clinton plan.

A few years after that victory, the insurers formed a front group called the Health Benefits Coalition to kill efforts to pass a Patients Bill of Rights. While it was billed as a broad-based business coalition that was led by the National Federation of Independent Business and included the U.S. Chamber of Commerce, the Health Benefits Coalition in reality got the lion's share of its funding and guidance from the big insurance companies and their trade associations.

Like most front groups, the Health Benefits Coalition was set up and run out of one of Washington's biggest PR firms. Porter-Novelli provided all the staff work for the Coalition while an executive with the NFIB, which has long been a close ally of the insurance industry, served as a frontman.

One of the key strategies of the Health Benefits Coalition as it was gearing up for battle in late 1998 was to stir up support among conservative talk radio and other media.

Among the tactics Porter-Novelli implemented for the Coalition was to form alliances with important conservative groups, such as the Christian coalition and the Family Research Council, to get them to send letters to Congress or appear at HBC press conferences. The Health Benefits Coalition also launched an advertising campaign in conservative media outlets. The message was that President Clinton owed a debt to the liberal base of the “Democrat” Party and would try to pay back that debt by advancing the type of big government agenda on health care that he failed to get in 1994.

The tactics worked. Industry allies in Congress made sure the Patients' Bill of Rights would not become law.

The insurance industry has funded several other front groups since then whenever the industry was under attack. It formed the Coalition for Affordable Quality Healthcare to try to improve the image of managed care in response to a constant stream of negative stories that appeared in the media in the late '90s and the first years of this decade.

It funded another group with a different name about the same time when lawyers began filing class action lawsuits on behalf of doctors and patients. Like the Health Benefits Coalition, this one, called America's Health Insurers, was created by and run out of a powerful Washington-based PR firm, APCO Worldwide.

APCO is perhaps best known for setting up a front group for the tobacco industry in the early '90s. Philip Morris reportedly hired APCO to organize a front group called The Advancement of Sound Science Coalition in 1993 to help fight public health efforts following the ruling by the Environmental Protection Agency that secondhand tobacco smoke was a carcinogen.

The insurance industry called on APCO again in 2007 to help blunt the impact of Michael Moore's movie, “Sicko.” APCO created and staffed a front group called “Health Care America” specifically to discredit Moore and to demonize the health care systems featured in the movie. The media contact for Health Care America was an APCO vice president who had served previously in PR roles at the Blue Cross Blue Shield Association and in the Bush administration.

APCO, like Porter-Novelli, also activated conservative allies and enlisted the support of conservative talk show hosts, writers and editorial page editors to warn against a “government-takeover” of the U.S. care system. That is a term the industry uses often to scare people away from any additional involvement of the government in health care.

Health Care America also placed ads in newspapers. One such ad, which appeared in Capitol Hill newspapers, carried this message, “In America, you wait in line to see a movie. In government-run health care systems, you wait to see a doctor.”

APCO's work on behalf of the industry included feeding talking points to conservatives in the media and in Congress and to place columns and op-eds written for the industry's friends in conservative and free-market think tanks like the American Enterprise Institute, Heritage, CATO, the Manhattan Institute and the Galen Institute.

By the way, you will not find America's Health Insurers among the clients APCO lists on its web site. That's because the work it does for AHIP is largely covert.

With this history, you can rest assured that the insurance industry is up to the same dirty tricks, using the same devious PR practices it has used for many years, to kill reform this year, or even better, to shape it so that it benefits insurance companies and their Wall Street investors far more than average Americans.

Americans need to be alert to how the industry and its allies are working to influence their opinions and lawmakers' votes. I know from years as an industry PR executive how effective insurers have been in using scare tactics to turn public opinion against any reform efforts that would threaten their profitability. I warned earlier this year that Americans and the media need to pay close attention to the efforts insurers and their ideological buddies will undertake to demonize other countries' health systems that don't allow for-profit insurance companies to have the free reign they have here. Americans must realize that the when they hear isolated stories of long waiting times to see doctors in Canada and allegations that care in other systems is rationed by government bureaucrats, the insurance industry has written the script. And they must realize that every time they hear that by creating a public insurance option, we will be heading down “the slippery slope toward socialism,” some insurance flack like I used to be wrote that, too.

Every time you hear about the shortcomings of what they call “government-run” health care, remember this: what we have now in this country, and what the insurers are determined to keep in place, is Wall Street-run health care. And know that for all practical purposes we already have one of the most insidious means of rationing care in the world–not by people we can hold accountable on election day but by insurance company accountants, underwriters and executives who are held accountable by a few wealthy investors and hedge fund managers who care far more about earnings per share than your health and well-being.

If Congress goes along with the “solutions” the insurance industry says it is bringing to the table and fails to create a public insurance option to compete with private insurers, the bill it sends to President Obama might as well be called the Insurance Industry Profit Protection and Enhancement Act. Americans need to realize that and keep it from happening. They should insist that before members of Congress vote on legislation, they take the time necessary to investigate insurance industry practices, motives and intentions and get a real sense of what our health care system would look like if the insurers get their way again.

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