Whistleblower: Insurance firms ‘very much’ behind town hall disruptions
The health insurance companies ‘are very much behind the town hall disruptions that you see and a lot of the deception that’s going on in terms of disinformation that many Americans, apparently, are believing.’ — Wendell Potter, former insurance executive.
By David Edwards and Daniel Tencer / August 11, 2009
Health insurance companies deserve “a great deal of the blame” for the sometimes violent disruptions to town hall meetings on health care, says a former health insurance company executive turned whistleblower.
Wendell Potter, a former executive with health insurer Cigna who now works as the senior fellow on health care at the Center for Media and Democracy, told MSNBC’s Rachel Maddow that health insurance companies “are very much behind the town hall disruptions that you see and a lot of the deception that’s going on in terms of disinformation that many Americans, apparently, are believing.”
On her show Monday night, Maddow cited statistics from the Securities and Exchange Commission showing that profits at the U.S.’s ten largest health insurance companies skyrocketed more than 400 percent between 2000 and 2007, from $2.4 billion in 2000 to $12.7 billion in 2007.
“Apparently while they quadrupled their profits, the number of Americans without health insurance grew by 19 percent,” Maddow said.
And she also pointed out that the average total take-home pay for the CEOs of those health insurance companies was $11.9 million each, per year, “while the number of Americans without health insurance, for whom a burst appendix can mean bankruptcy, has gone through the roof.”
Asked why health care costs are going up, Potter told Maddow: “Since 1983… the amount of money that insurance companies take in in premiums — less and less of that is going to pay medical claims.”
Potter said that the money health insurers spend on health care for their policy-holders has dropped from 95 percent of revenue to around 80 percent. Although Potter did not elaborate on why that is, presumably it has to do with higher bureaucratic costs, increased advertising budgets, other tangential activities not directly related to health care — and higher profit margins.
“Another thing is they kick people off the rolls when they do get sick or injured,” Potter said. “Also, they’re paying fewer claims.”
Potter suggested that health insurers’ fears of a public health alternative are unfounded, because they can still make money with a public plan in place.
“They could [turn a profit], absolutely. I’ve seen the health insurance industry change its business models many times. The insurance companies who operate now are very different from the companies that operated a few years ago and the one thing they know how to do is make money.”
Source / the raw story