The Scoundrels of Health Care

This one just makes me flat-out MAD. And it is the best example I’ve seen in quite a while of why the health care/health insurance reform debate that is currently underway in this country must end up with a final plan that includes at the very least what is now being called the “public option” (i.e. – a nationwide, government-run, non-profit plan which consumers could choose right alongside the traditional insurance companies).

It’s a story from the Los Angeles Times regarding a House Subcommittee on Oversight and Investigations hearing on health insurance that was held last Tuesday, June 16. And (surprise, surprise) it was covered by none of the major news outlets: not any of the broadcast nightlies, and not CNN, FOX, nor MSNBC. That’s probably why you’ve never heard this story. Most of us get our news from TV in one form or another…and even if you’re a newspaper reader, unless you live in LA, this one sailed right by you. In the hearing, the Chair of the subcommittee, Bart Stupak of Michigan, laid out allegations – no, actually, proof – that three of the nation’s largest insurers (WellPoint Inc., UnitedHealth Group and Assurant, Inc.) had systematically, over a five year period, cancelled the insurance of at least 20,000 policyholders, saving them (the insurers, not the policyholders) a combined total of over $300,000,000 in medical claims during that time.

But it gets worse.

Insurance is a business, and they can cancel policies for a variety of reasons. Talk to Beth if you really want to get down into the nitty gritty on it (though of course she doesn’t work in individual or group health insurance). But these three companies didn’t just cancel policies on a random selection of their insureds. No, according to the sworn testimony of researchers for the subcommittee, they

also found that policyholders with breast cancer, lymphoma and more than 1,000 other conditions were targeted for rescission and that employees were praised in performance reviews for terminating the policies of customers with expensive illnesses.

In other words, there were performance review incentives for employees of these companies to ferret out policyholders who had in many cases been paying monthly premiums for their health care (or their employers had) for years – even decades – who developed high-cost, severe illnesses, and find technicalities on which the companies could terminate the policies. put even more baldly: they were being praised and reviewed well for “cutting costs” for their employer, which, when the business you’re examining deals in personal health insurance, means abandoning premium-paying policyholders when they need you the most — when you’re very sick and facing expensive, painful, lengthy treatments. Charming, eh?

It gets better.

In the hearing, these revelations were met with (as you might expect) howls of outrage from politicians on both sides of the aisle. Say what you like about grandstanding politicians who are always looking for a little face time in the spotlight supporting (or opposing) an issue which they think will make them look good. Sure, that’s probably true. But I’d bet that every single congressperson in that room knew – or at least knew OF – someone who had had a bout with a serious, debilitating, perhaps even life-threatening illness. Someone from their own family, or their spouse’s. Perhaps even themselves. And it probably wouldn’t have been hard for these legislators to imagine these bureaucrats denying THEIR loved ones coverage. I’m guessing most of the congresspeople didn’t have to fake their outrage. And the worst was yet to come. After these disgusting revelations, the talk – naturally – turned to asking the CEOs to commit to ending this practice of “rescission” (except in cases of things like insurance fraud, etc.).


The executives — Richard A. Collins, chief executive of UnitedHealth’s Golden Rule Insurance Co.; Don Hamm, chief executive of Assurant Health and Brian Sassi, president of consumer business for WellPoint Inc., parent of Blue Cross of California — were courteous and matter-of-fact in their testimony.

But they would not commit to limiting rescissions to only policyholders who intentionally lie or commit fraud to obtain coverage

And THAT, folks, is precisely why we absolutely MUST have a “public option” in the final mix of whatever form the health care reform bill finally takes: because a non-profit, government-run plan would, over time, gain a (deserved) reputation for NOT practicing such profit-saving rescission, abandoning people to their fate when they need coverage that they’ve paid into for years most. There are many different flavors of “public option,” in various countries throughout the world, from Canada to Britain to…well, every other industrialized, first-world nation on the planet. We’re paying far, far more per person for our health care than the citizens of ANY of those other countries, and in return, we’re getting the 37th best care in the world (according to various metrics used to assess such things by the World Health Organization), and – far scarier – we know that our insurers have, by definition, their own profits in mind as a higher priority than OUR health. And that they will – if they can, legally – expend every effort to find ways to avoid paying for our care, should we become TRULY ill.

A “public option” would be prohibited by LAW – since it would derive not just from premiums but also in part from taxpayer revenue – from engaging in such behavior. Nor, in fact, would it have any incentive to do engage in it, being non-profit. The mandate of such a “public option” for insurance coverage would be what all health care should be driven by – a genuine desire to improve and maintain the health of the population it serves…not to increase the per-share value of the investors for next quarter’s shareholder meeting.

And that’s why the Republicans can’t abide it: because they know that such a public option would, over time, come to be known as cheaper AND more reliable than any of the profit-skimming for-profit insurance options. It would also likely have a better standard of care – or at least as good. And it would have much, MUCH lower prescription drug prices. Why do people import Canadian pharmaceuticals into the USA? Because they’re cheaper. Why are they cheaper? Because in Canada, the entire country has a single-payer system which allows it to leverage the awesomely powerful tool of collective bargaining with the likes of Pfizer and Wyeth to negotiate lower drug prices. If these companies wish to do business in Canada, they have to go through this one single, not-for-profit government watchdog/administration group. That’s why the Canadian citizen pays between 1/4 and 1/2 of the price for most drugs that we do – and why so many stretched-to-the-bone seniors and low-income people (and heck, even many middle-class folks who are being more and more squeezed by the rising costs of health care in the USA) are turning to re-imported Canadian drugs: because they’re the same pills, made in American factories, and even WITH the cost of shipping them to Canada, and re-importing them into the United States, they’re STILL cheaper than what we can get them for here, in many cases — especially if your insurance plan doesn’t cover the drug you need…or you have no insurance, like 45 million Americans don’t.

Say it with me, people: “FULL PUBLIC OPTION.” Unless you enjoy the likes of the article you just read.