Authors: Wendell Potter
Deadly Spin
DEADLY SPIN
AN INSURANCE COMPANY INSIDER
SPEAKS OUT ON HOW CORPORATE
PR IS KILLING HEALTH CARE AND
DECEIVING AMERICANS
Wendell Potter
For Blaine and Pearl Potter. Thank you for
the many sacrifices you made for me and for leading
by example. I’m blessed to be your son.
For Alex and Emily. Thank you for putting up with an
often distant and cranky father while I was trying to find the
courage to do what I felt in my heart was the right thing.
And, especially, for Lou. Thank you for your patience and
steadfast support, for being the world’s best mom and for
putting up with me, not only during my crisis of conscience
but since the day we met. You’re the love of my life.
Contents
CHAPTER I
CHAPTER II
CHAPTER III
CHAPTER IV
Remote Area Medical in Wise County, Virginia
CHAPTER V
Health Care History, Reform, and Failure
CHAPTER VI
CHAPTER VII
CHAPTER VIII
CHAPTER IX
ERISA Stymies the Sarkisyans, and Us
CHAPTER X
CHAPTER XI
CHAPTER XII
When my old friend and colleague Wendell Potter contacted me in 2008, it was the first time I’d heard from him in years. He told me he’d quit his job as head of corporate communications at the health insurer CIGNA and was trying to decide what to do next. I remember asking him what had happened at CIGNA to make him leave, and he said it was a “long story” but that he’d tell me sometime. The short version, he said then, was that he had decided to come back to the “real world.”
In many ways, I’ve learned subsequently, it was Wendell who had been living in the real world—where corporate greed and human indifference are the daily norm. It was the rest of us, including me, who were living the fantasy, thinking that America’s free-market system could provide actual health care for its people through a for-profit structure.
I’ve known Wendell since the late spring of 1973, when he came to the old
Memphis Press-Scimitar
as a summer intern after graduating from the University of Tennessee in Knoxville. I was the rewrite man and an assistant city editor at the now defunct afternoon daily, which meant I was the one who handled the rough copy that came from reporters and interns, frequently with deadlines staring us in the face. Wendell made his mark quickly.
He knew the right questions to ask, and he knew how to get the answers and put them into words. His copy may have needed a little tweaking from time to time, but he was a quick learner, even thanking me for some of the changes I made. (How rare is that?) Everyone on the city desk quickly knew we had a keeper, and Wendell rose rapidly through the journalistic ranks at Scripps Howard in the next few years—eventually winding up as the youngest reporter the chain ever assigned to cover Washington, D.C., politics.
As Wendell and I chatted in the months after reconnecting in 2008, it became evident that he had an even bigger story to tell. We even talked about him writing a book, but he was still unsure about what he would do next, actually reveling in the first taste of anonymity he’d experienced in decades.
But things changed. Health care reform became front-page news. Wendell recognized that the PR barrage unleashed by his former industry was skewing the debate on this vital issue. He decided to speak out, regardless of the consequences. The result was months of public appearances—in person, on TV, and in congressional hearings—and now he’s finally written that book. You’re holding it.
Deadly Spin
is a revelation about America’s health care system unlike anything else you’ve seen. There are a lot of books and articles about health care reform, but none of them provide the insider’s perspective like this one.
As an old newshound, I’m a little cynical about anything I read. And you should be, too. I ask myself, who’s telling me this and why? To me, the chapters that follow are the work of a first-rate investigative reporter who spent twenty years on his undercover assignment. No one actually gave him the assignment, and he wasn’t even aware he was on one—until the events occurred that he outlines for us in the book. But once a journalist, always a journalist.
We’re fortunate to have Wendell Potter back on the beat.
Barney DuBois
Memphis, Tennessee
July 2010
The twentieth century has been characterized by three developments
of great political importance: the growth of democracy, the growth of
corporate power, and the growth of corporate propaganda as a means
of protecting corporate power against democracy.
—ALEX CAREY
1
You have our commitment to play, to contribute, and to help pass
health care reform this year.
—KAREN IGNAGNI
2
A
BOUT
forty-five thousand people die in America every year because they have no health insurance.
3
I am partly responsible for some of the deaths making up that shameful statistic.
As a senior public relations executive, or “spinmeister,” for two decades with two of the largest for-profit health insurance companies in the United States—Humana and CIGNA—it was my job to enhance those firms’ reputations. But as one of the industry’s top public relations executives and media spokesmen, I also helped create and perpetuate myths that had no other purpose but to sustain those companies’ extraordinarily high profitability.
For example, if you are among those who believe that the United States has “the best health care system in the world” despite overwhelming evidence to the contrary—it’s because my fellow spinmeisters and I succeeded brilliantly at what we were paid very well to do with your premium dollars. In fact, the United States ranks 47th in life expectancy at birth, behind Bosnia, and 54th, behind Bangladesh, in “fairness,” a measure of the extent to which the best care is available equally throughout a country.
And if you were persuaded that the health care reform bill President Barack Obama signed into law in March 2010 was “a government takeover of the health care system,” my former colleagues and I earned every penny of our handsome salaries. Not to mention our bonuses.
From the first day of the Clinton administration in 1993 until shortly before the election of Obama, I was a behind-the-scenes leader in every industry effort to kill any reform legislation that threatened insurance company profits. Although I told people during that period that I never lied to a reporter, the reality is that I often did—but in such subtle ways that I could never even acknowledge to myself that I was purposely trying to mislead. At the time, I was unaware that I was feeding the media and the public false information, and so caught up in the industry’s swirling spin machine that I was oblivious to it.
Had it not been for a series of events that occurred in 2007—events that, as someone raised as a Southern Baptist, I can’t help believing were part of some kind of divine intervention—I would probably still be spinning for health insurers.
In retrospect, it seems as if it were predestined that I would become either a witness to or a participant in those events, which would reveal to me just how corrupt and deadly the American health insurance industry had become, and also how far I had strayed from my own moral path. By the end of 2007, it was inevitable that I would leave my job and begin speaking out against what I consider now to be an evil system built and sustained on greed.
I don’t mean to imply that all people who work for health insurance companies are greedier or more evil than other Americans. In fact, many of them feel—and justifiably so—that they are helping millions of people get the care they need. Mostly, they are just as unaware as I was for much of my career of what really motivates the top executive officers of the companies they work for.
The health insurance industry today is dominated by a cartel of large, for-profit corporations. By necessity and by law, the top priority of the officers of these companies is to “enhance shareholder value.” When that’s your top priority, you are motivated more by the obligation to meet Wall Street’s relentless profit expectations than by the obligation to meet the medical needs of your policyholders. Some nonprofit insurers still operate in the United States, but they are now behaving the same way—as they must, in order to compete with their for-profit counterparts, lest they be forced to put themselves up for sale or close, as many have already done.
It was not until late in my career that I became aware of the lengths to which insurance company executives will go to meet Wall Street’s expectations. The further up the corporate ladder I climbed, the more I saw, and the more disillusioned I became with my job, my profession, and my industry.
As it played out, my full awakening occurred during the events I alluded to above, during the last eight months of 2007. I was involved in three episodes that opened my eyes to how unscrupulous my industry had become and how it failed sick and suffering Americans every day. I will describe all three of these events and their significance—not only to me but to the state of the U.S. health care system and to the future of our democracy—in the following chapters.
I will also attempt to explain why it is vital to understand the role of the public relations industry—the spin machine—in our public discourse and in our lives, how to recognize it, and what we can do about it.
More than half a century ago, Vance Packard revealed in his book
The Hidden Persuaders
how advertisers use subliminal tactics and other psychological techniques to get people to buy certain products and to vote for certain political candidates.
Packard described his book as “an attempt to explore a strange and rather exotic new area” of American life.
“It is about the large-scale efforts being made, often with impressive success, to channel our unthinking habits, our purchasing decisions, and our thought processes by the use of insights gleaned from psychiatry and the social sciences,” he wrote. “Typically these efforts take place beneath our level of awareness; so that the appeals which move us are often, in a sense, ‘hidden.’ The result is that many of us are being influenced and manipulated, far more than we realize, in the patterns of our everyday lives.”
4
Americans are probably more aware of the techniques advertisers use to influence decisions today than they were fifty years ago. But comparatively few are aware of the more insidious techniques used by PR professionals to manipulate public opinion and, consequently, public policy. What I hope to accomplish in this book is to pull the curtain back to reveal the techniques employed by practitioners of the dark arts of PR—from the use of “third-party advocates” to the creation of front groups, from the staging of PR “charm offensives” to the selective disclosure of information and misinformation—which influence people’s thoughts and actions in ways that advertising cannot. In that sense, this book is as much about PR as it is about health care. Deceptive practices corrupt public debate and policy in many industries, but health care offers a timely and particularly egregious example, which I can attest to firsthand.
If advertisers are the hidden persuaders, PR practitioners are the “invisible persuaders,” to borrow the term British author David Michie used in the title of his 1998 book about the growing influence of unseen PR advisers in the United Kingdom.
5
PR people do not create ads that can be seen or heard or touched. They create perceptions without any public disclosure of who is doing the persuading or for what purposes.
Although PR techniques remain a mystery to most people, the art of invisible persuasion has long been in the making. PR and corporate propaganda go back to the early part of the twentieth century. One of the first practitioners was Ivy Lee—often called the father of modern PR—who was hired by the Standard Oil Company to transform John D. Rockefeller Jr.’s reputation from “biggest criminal of all time,” as his detractors called him, to “the great benefactor of society,” as he is more commonly known today. Lee’s biggest competitor at the time was Edward Bernays, who was able to persuade young women to start smoking cigarettes on behalf of his client, the American Tobacco Company.
From such precedents grew a profession reaching from big tobacco to the military-industrial complex, and now to health care. It uses deceptive tactics to influence how the public thinks and, ultimately, how lawmakers vote. Over the last several decades, through the skillful use of such tactics, the American health insurance industry has created a perception of its role and usefulness—its raison d’être—that obscures its real goal: profits.
Many of the biggest and most influential PR firms in the country, including APCO Worldwide and Porter Novelli, have carried out deception-based campaigns over many years for health insurers, as I will describe. Their attitude and approach have all too often been to do whatever it takes to win. I should know; I often hired them for just this reason.
That said, it is not my intention to write a book that condemns an entire profession. Many—probably most—PR professionals follow guidelines established years ago by the Public Relations Society of America, an organization that encourages ethical behavior among its members and all PR practitioners, and of which I have been a proud member for more than three decades. In fact, PRSA was one of the first organizations—and there have been many—to invite me to speak to its membership to explain why I had become such an outspoken critic of both the health insurance industry and the PR profession.
PRSA also published my comments on professional conduct in a recent edition of its quarterly magazine, the
Public Relations Strategist
. In that interview, I noted that PR people who veer off the ethical path, as I did, are often those who work for publicly traded companies—which most large insurers now are—that are under constant pressure from investors to meet profit expectations.
It was this same pressure, I know for a fact, that led otherwise-decent men and women to plan and implement the fearmongering, deception-based PR campaign to erode public support during the recent health care reform debate. Their orchestrated attacks during the debate eventually made it politically unfeasible for Congress to pass the kind of radical health care reform desired by President Obama and many American voters—and that Democratic leaders just months earlier had believed could be enacted.
Many health care reform advocates naïvely thought that with Obama in the White House and Democrats in control of Congress—and with the health insurance industry claiming to be on the side of the angels this time—the stars had finally aligned for comprehensive health care reform that would lead, with the stroke of the president’s pen, to universal coverage. They thought that achieving the goal of every Democratic president since Franklin Roosevelt—which every other developed country on the planet had achieved years ago—was all but inevitable.
It was because of that misplaced confidence, based to no small extent on the health insurance industry’s PR offensive, that I decided I had to speak out.
I warned members of Congress—in a series of appearances before House and Senate committees—that if the bill Congress ultimately passed included many of the so-called solutions insurers were “bringing to the table,” and if it did not include a public insurance option to compete with private insurers, it might as well be called the “Health Insurance Industry Profit Protection and Enhancement Act.”
The bill the president signed will indeed protect and enhance the health insurance industry’s profits for many years to come. It will also do a lot of good for a lot of people. Among other things, it will expand the Medicaid program to cover many more low-income families; it will make it illegal for insurance companies to deny coverage because of preexisting conditions; it will provide tax credits to small businesses to encourage them to offer health benefits to their employees; and it will close the infamous gap in the Medicare drug benefit known as the “doughnut hole.”
But in many other significant ways, the industry’s spin worked as intended. The new law does
not
include the public option the president once said was essential “to keep insurance companies honest”—and it
does
include a provision that candidate Obama was adamantly opposed to: a mandate that all Americans not eligible for an existing public program buy coverage from a private insurer. Candidate Obama said during the campaign that he did not think people should be forced to buy insurance they could not afford. The insurance industry and many members of Congress persuaded President Obama to change his mind. As a result, insurers will get billions of dollars in new revenues from people required by law to buy their products and billions more from the government to subsidize premiums for people who can’t afford them. Because of the way the legislation came together on Capitol Hill, the complex bill that reached the president’s desk would not really work without the so-called individual mandate.