KHI News Service

Insurance industry whistleblower criticizes Medicaid plan

Author Wendell Potter also defends federal health reform in K.C. speech

By Jim McLean | January 12, 2012

Privatizing the Kansas Medicaid program is a potentially disastrous idea, according to a former insurance-industry insider turned health-reform crusader.

Wendell Potter, an author and leading critic of the health insurance industry, was asked about Gov. Sam Brownback’s plan to contract Medicaid services out to private managed care companies after a speech Wednesday night at the Central Library in Kansas City, Mo. His answer, that it was a “boneheaded idea,” drew applause from many in the audience of more than 500 packed into the library’s main lobby.

In an interview afterward, Potter said states that give more control of their Medicaid programs to insurance and managed care companies are making a mistake, particularly if they are dealing with for-profit companies.

“The biggest problems in our health care system have been caused by insurance companies,” Potter said. “And to give them more control over not only private dollars but tax dollars is nonsensical. It is the wrong way to go.”

Audio clip

Insurance Company Insider, full speech audio

Potter’s Kansas City appearance was sponsored by the Missouri Health Advocacy Alliance, a nonprofit organization pushing for transformation of the health care system. Potter also blogs for The Center for Media and Democracy, a nonprofit organization that many conservatives perceive as liberal.

Brownback administration officials have said their main objectives in overhauling the $2.8 billion Medicaid program are to save money and improve care for the more than 300,000 Kansans enrolled. But Potter said decades working as a public relations executive for large health insurance companies convinced him that profits were more important to the industry than providing quality coverage.

“I have nothing against managed care as a way of providing access to care,” Potter said. “But you have to be very, very careful. You have to have accountability built into it and protections for consumers, otherwise it could be an absolute disaster for Kansans.”

Dr. Robert Moser, secretary of the Kansas Department of Health and Environment, the state’s lead Medicaid agency, said Potter and others who say the plan is good for insurance companies but bad for consumers are jumping to conclusions ahead of any evidence.

He said the administration’s plan ties millions of dollars in future payments for the managed care companies to performance incentives designed to improve care. Payments would be withheld from contractors that don’t meet specific milestones.

“This is a different model,” Moser said. “We’re working with managed care organizations to implement an integrated, whole-person care system where we have health care outcomes driving the initiative … to make certain we get the product we’re looking for.”

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'Road to Damascus' moment

The misinformation campaign being waged against the Affordable Care Act, not the Kansas Medicaid program, was Potter’s main focus during his speech. It also is the focus of his book, “Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans,” for which he won the 2011 Ridenhour Book Prize for social significance.

Potter’s transformation from insurance company executive to whistleblower began in 2008 when he experienced a crisis of conscience during a trip back to rural Tennessee to visit his parents. While home, he took a day to drive to Wise County, Va., to visit a health fair, where thousands of uninsured people came from as far away as Ohio and Georgia to get free health care from volunteer doctors and nurses.

“That stretch of road from Kingsport, Tenn., to Wise County, Va., turned out to be my road to Damascus,” Potter said. “Nothing could have prepared me for what I saw when I got there that day. Enormous lines of people, some of whom were soaking wet because it had rained that morning, stretched out of view.”

More than 4,000 were lined up at the county fairgrounds to be treated in vacant animal stalls. At that moment, Potter said, it hit him “like a bolt of lightning” that the people in line were his neighbors.

“Until that day, I hadn’t even thought of them as being human beings,” he said. “To me, they had just been numbers on a Census Bureau spreadsheet, nothing more. But when I came face to face with them, they were no longer just numbers and they never could be again.”

At the time of his epiphany, Potter said he was working on a policy paper to buttress the insurance industry’s claim that the number of Americans without insurance wasn’t a problem that required intervention by the federal government.

On a mission

In addition to the Virginia experience, Potter said the death of a teenage girl forced to wait years for a liver transplant because of a legal battle between her parents and Cigna, the company for which he worked, made it impossible for him to stay on as an industry spokesman. So he left to lift the veil on what he calls deceitful industry practices in testimony to Congress and in speeches across the country.

→ Read the first chapter of the book free or purchase it at Google eBooks.

→ The Central Library plans to post video from the event on their media site.

Kansas Public Radio story on Potter

Part of his mission, he said, is to defend the federal health reform law against what he considers to be industry propaganda. He cited as an example the often-heard claim that the law is a government takeover of health care.

“That is simply not true,” he said. “What is true is that we have had a Wall Street takeover of health care while we were not paying attention. And that, my friends, is what should really scare the heck out of us.”

Out on the stump, Potter said, he sometimes gets the feeling that he and others defending the reform law as an imperfect but important step forward are losing the public relations battle. Polls continue to indicate that many if not most Americans remain opposed to the law, despite the fact that the same polls show individual parts of the law are popular. Those include provisions that allow children to remain on their parents’ insurance policies longer and prohibit insurance companies from denying coverage to people with pre-existing medical conditions or capping annual and lifetime benefits.

“We must make sure that our friends and our neighbors understand what will be taken away if the special interests and their cronies in Washington succeed in gutting the new law and destroying Medicare and Medicaid and even Social Security,” Potter said in closing. “We need to explain to them how the Affordable Care Act really works and how it puts real people ahead of corporate profits.”