The Tyranny of Wall St.-Run Health Care: No CEO Left Behind

The insurance industry has shifted to selling so-called "consumer-driven" plans with very high deductibles that shift a great deal of health care cost from employers and insurers to individuals.
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Cries of "government-run health care" serve as distraction from the fact of "Wall St.-run health care" as surely as "Stop the vote count" in 2000 aimed to subvert an election. Republicans' rule of dominion: when you can't win fairly, create chaos and destruction -- blow things up.

Former CIGNA executive-turned-whistle-blower Wendell Potter told Congress that the insurance lobby is resurrecting old fears "to tar a transparent and accountable, publicly accountable health care option as, quote, 'government-run health care.' What we have today, Mr. Chairman, is Wall Street-run health care..." Said Potter, "a corporate bureaucrat" stands between you and your doctor.

"The industry has always tried to make Americans think that government-run systems are the worst thing that could possibly happen to them, that if you even consider that, you're heading down on the slippery slope towards socialism. So they have used scare tactics for years and years and years...," Potter told Bill Moyers. "The industry doesn't want to have any competitor; in fact, over the course of the last few years, has been shrinking the number of competitors through a lot of acquisitions and mergers. So first of all, they don't want any more competition period. They certainly don't want it from a government plan that might be operating more efficiently than they ....operate."

The health care industry is reportedly spending $1.4 million daily to control health care legislation. Bill Moyers reports that millions of dollars have gone to hire more than 350 former members of congress and government staffers as industry lobbyists.

Right-wing survival-of-the-fittest capitalism consistently pits the privileged against the undeserving underclass in support of more costly multi-tiered, pay-or-die health care. The sense of entitlement of corporate elites is divorced from reality or achievement. Self-serving health insurance moguls rationalize multi-million (even billion) dollar compensation packages at the expense of the sick, even as they petition for more taxpayer subsidies in any reform bill.

Former United Health CEO William McGuire set a standard for overreaching corporate greed, retiring with $1.6 billion in stock options, dwarfing his $8 million annual salary plus perks.

A frequent participant at congressional hearings and White House health care forums, Aetna CEO Ron Williams has become the insurance industry's Harry to America's Health Insurance Plans president Karen Ignani's Louise. Ignani has misrepresented polls showing that 72% actually favor a public plan, and a majority think government would do a better job of holding down costs and providing coverage than private insurers. Bill Moyers uncovered AHIP's insurance reform game plan - to "Highlight horror stories of government-run systems."

In fact, a 2008 Kaiser Foundation poll indicated that people who like their plans the most are those who use them the least.

Williams urged in Senate committee hearings that everyone be moved into private health insurances, with a strong individual mandate to purchase his product (!). A public option, he protests, would "unfairly" compete with private for-profit insurances, and is "untested" - though traditional Medicare has functioned as a single-payer financed system with free choice of private providers for over 40 years. Williams said he opposes introducing "a new competitor who has the rulemaking ability that government would have," also challenging regulatory oversight.

Potter relates that Williams was originally recruited by Aetna from WellPoint to help Aetna recover after its attempts to consolidate power by buying up a lot of its competitors, many not very profitable, at a time when Aetna's membership was 21 million and its stock price plummeting. Among Williams' first acts was ordering a revamp of Aetna's IT system to permit purging accounts that were unprofitable. Within a few years 8 million members were purged from the system and Aetna's stock rose, as well as Ron Williams' compensation.

Williams' total annualcompensation crept up from $23.5 million in 2007 to $24.3 million in 2008 - more than half ($13,537,365) from stock option awards. He received an additional $6,456,630 in stock awards on top of his base salary of $1,091,764. Personal use of a corporate aircraft and vehicle, as well as financial planning and 401(k) company matches added another $101,487 of perks for Williams, who is the largest earner among current health insurance CEOs.

Not above hyperbole or irony, Williams compared the uninsured to bank robbers in a 2008 Fortune Magazine interview: "Today we all pay for the uninsured. If an individual sticks up a bank and walks off with $25,000, there are consequences. If someone who really could have had an insurance policy consumes $25,000 worth of health care, everyone else pays for that." Echoing Rep. Zach Wamp's verbal assault on the uninsured -- "half of them go naked on purpose" -- the self-serving argument implies that the uninsured scheme to finagle free health care, even as Aetna and other insurers shift ever greater costs to the insured, growing the numbers of both uninsured and underinsured, and generating a concurrent rise in medical bankruptcies and uncompensated medical care that is ultimately borne by taxpayers.

This further "solution" by Williams to grow Aetna's bottom line amounts to offering catastrophic or "consumer-driven" plans. Potter reported that the industry has shifted from selling primarily managed care plans to so-called "consumer-driven" plans with very high deductibles that shift a great deal of health care cost from employers and insurers to individuals. Consequently, many people are unable to afford their copayments.

Aetna cleared almost $2 billion in profits in 2007, even as it celebrated its low "Medical Loss Ratio" - the percentage of revenue it "loses" to paying for health care. (Sensing a public relations problem, the industry has renamed this the "Medical Benefit Ratio.") Like many health insurers, Aetna spends less than 80 percent of premiums on health care by avoiding unhealthy enrollees and limiting services.

Potter notes that as insurance companies put profits before people, Medical Loss Ratios have shrunk from 95% of premiums paid toward insurance claims in the Clinton years (leaving 5% overhead and profits), to 80% in 2008 (with 20% overhead and profits). Insurers have reduced Medical Loss Ratios primarily by such practices as Rescission (dropping policies); Denial Management, denying, delaying and reneging on claims; and Purging employer accounts. A small business with a single high-health-needs employee will see exhorbitant premium increases, often forcing them to drop high-cost policies.

While Congress bends over backwards to maintain for-profit insurances at the center of U.S. health care reform, other advanced nations do not permit for-profit health insurances for primary care. Private for-profit insurances instead sell supplemental coverage, e.g., elective plastic surgery, private hospital rooms with TVs, etc.

As much as the Washington political right decry "entitlements" for the undeserving underclass, Washington itself is gripped by a sense of entitlement as expansive as corporate entitlement at the core of corrupted health care policy. Covered by Federal Employee Health Plans that are 70% subsidized by taxpayers, with free access to health care at the Capitol, and their palms greased by corporate coin, too many congressional legislators remain largely insulated and disconnected from the travails of health care seekers in the heartland.

Post Note: Washington's tin ear and sense of entitlement was on display when the House recently approved a half billion dollars to enlarge its available fleet of planes -- adding four more planes than the Pentagon wants or needs -- to ferry Congress and government officials around the world. It was reported that House members spent 3,000 days overseas last year -- four times more than ten years ago -- adding travel costs of $13 million, a tenfold increase since 1995. Though the House backed down on its demand for planes in the face of public scrutiny, perks for the privileged just keep growing.

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