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Wendell Potter on Profits Before Patients
W.S. Merwin, photo by Robin Holland
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July 10, 2009

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. "I didn't intend to [speak out], until it became really clear to me that the industry is resorting to the same tactics they've used over the years, and particularly back in the early '90s, when they were leading the effort to kill the Clinton plan."

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.

Strategy Memos

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.

Red-Flagging and Rescission

Among the other testimony heard by the Committee on Commerce, Science and Transportation was that of Robin Beaton. It reflected some of the insurance company tactics condemned by Potter.

It was a nightmare scenario. The day before she was scheduled to undergo a double mastectomy for invasive breast cancer, Robin Beaton's health insurance company informed her that she was "red flagged" and they wouldn't pay for her surgery. The hospital wanted a $30,000 deposit before they would move forward. Beaton had no choice but to forgo the life-saving surgery.

Beaton had dutifully signed up for individual insurance when she retired from nursing to start a small business. She had never missed a payment, but that didn't matter. Blue Cross cited two earlier, unrelated conditions that she hadn't reported to them when signing up — acne and a fast beating heart — and rescinded her policy.

Beaton pleaded with the company and had her doctors write letters on her behalf to no avail. It was not until Rep. Joe Barton (R-TX) personally called Blue Cross that her policy was reinstated and she could undergo surgery. In that year, Beaton's tumor doubled in size, leading to further complications necessitating the removal of her lymph glands as well.

>>Watch Robin Beaton's testimony to the House Energy and Commerce Subcommittee on Oversight and Investigations.

The practice is called "rescission" and Beaton's is not an isolated case. The House Energy and Commerce Committee found that the major private health insurers had rescinded the policies of approximately 20,000 people in a five year period, to avoid paying out approximately $300 million in benefit claims.

Appearing before the same committee, CEOs of the major health insurance companies stated that they would continue to use rescission, arguing that it is a necessary protection against fraud and abuse.

>>Watch the health care CEOs appear before the House Energy and Commerce Subcommittee on Oversight and Investigations.

Wendell Potter
Photo by Robin Holland

Wendell Potter has served since May 2009 as the Center for Media and Democracy in Madison, Wisconsin'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.

Based in Philadelphia, Potter provides strategic communications counsel and planning services as an independent consultant. He also speaks out on both the need for a fundamental overhaul of the American health care system and on the dangers to American democracy and society of the decline of the media as watchdog, which has contributed to the growing and increasingly unchecked influence of corporate PR.

Before his switch, Potter 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, Potter headed communications at Humana Inc., another large for-profit health insurer and 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 a lobbyist in Washington for the organizers of the 1982 World's Fair in Knoxville, Tenn.

Wendell Potter first worked as a journalist. When fresh out of college, he worked 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 Potter 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. He holds an APR, which means he is accredited in public relations by the Public Relations Society of America, and is still a dues-paying member of the Society of Professional Journalists and the National Press Club in Washington.

Guest photos by Robin Holland.

Related Media:
Medical practitionersRobert Reich
Former Labor Secretary Robert Reich sits down with Bill Moyers to talk about the influence of lobbyists on policy, the economy, and the ongoing debate over health care. (June 12, 2009)

Medical practitionersReforming Health Care
Washington's abuzz about health care, but why isn't a single-payer plan an option on the table? Public Citizen's Dr. Sidney Wolfe and Physicians for a National Health Program's Dr. David Himmelstein on the political and logistical feasibility of health care reform. (May 22, 2009)

Medical practitionersDonna Smith
Bill Moyers speaks with advocate Donna Smith about how our broken system is hurting ordinary Americans. (May 22, 2009)


Medical practitionersCalifornia Nurses Association
The California Nurses Association advocates a single payer national health insurance system. (May 5, 2008)


Melody Petersen, photo by Robin Holland Melody Petersen
Melody Petersen talks with Bill Moyers about her new book OUR DAILY MEDS, and how drug companies market medication. (May 16, 2008)

Rachel CarsonFRONTLINE: "Sick Around the World"
FRONTLINE travels to five other wealthy capitalist democracies — Great Britain, Japan, Germany, Taiwan, and Switzerland — to find out how they provide health care to all of their citizens far a fraction of the cost of the U.S. system.

References and Reading:
America's Health Insurance Plans Memos: here and here (PDFs).

Frank Luntz Memo (PDF)
The Frank Luntz memo strategizing opposition to health care reform Bill Moyers mentions in the interview.

"Health insurers refuse to limit rescission of coverage"
By Lisa Girion, LA TIMES, June 17, 2009.

"Insured, but Bankrupted by Health Crises "
By Reed Abelson, THE NEW YORK TIMES, June 30, 2009.

"Terminations of Individual Health Policies by Insurance Companies"
Read testimony by Robin Beaton and others who've lost coverage, as well as from insurance company executives. Hearing held by the House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations, June 16, 2009.

Wendell Potter

Wendell Potter's biography on PR Watch.org

Wendell Potter's blog.

Also This Week:
WENDELL POTTER
With almost 20 years inside the health insurance industry, Wendell Potter saw for-profit insurers hijack our health care system and put profits before patients. Now, he speaks with Bill Moyers about how those companies are standing in the way of health care reform.

WENDELL POTTER'S TESTIMONY

MONEY, POLITICS AND HEALTH
Trace campaign contributions, ad spending and the revolving door between industry and government.

HEALTHCARE REFORM ON THE TABLE
Public option, single payer, free market — what are the options now under discussion?
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