I used to do health insurance company PR. Here’s what I think the backlash is missing
Posted on 12/11/2024
The suspect arrested in the death of UnitedHealthcare CEO Brian Thompson, Luigi Mangione, reportedly suffered from excruciating backpain. That is no surprise to the people who have spent the past week sharing stories of health care denied by insurance companies.
Decades ago, the health insurance business put in place a dike to hide and contain the public’s disdain for for-profit health insurers, and to keep reformers at bay. Now, that dike might collapse.
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As the former VP of corporate communications at Cigna, I played a role in building and fortifying that dike. Every year, my colleagues and I across the industry devoted massive amounts of the money — money our customers paid us to cover their medical care — on lobbying, campaign contributions, deceptive PR campaigns, and even charitable donations to buy goodwill. All of that was spent for the sole purpose of maximizing shareholder return. Restricting patients’ access to needed care made UnitedHealth, Cigna and a handful of other big insurers Wall Street darlings, and made lots of people lots of money while doing little to enhance care.
Much of that spending was to create the illusion that we Americans are happy with our health care system and don’t want politicians to get any bright ideas about changing it. Just three weeks before the tragic killing of United’s Brian Thompson, AHIP, the industry’s biggest PR and lobbying group, touted a recent “survey” that found “a strong majority are satisfied with their current employer-provided plans.” But I am doubtful. The survey was produced by a D.C. strategic communications firm founded by political operatives to manage corporate reputations and “shape perceptions.” AHIP is funded primarily by UnitedHealth and the other big for-profit middlemen whose fortunes depend on remaining in the good graces of those investors and a handful of Wall Street financial analysts.
Media coverage I’ve seen so far of this shocking corporate assassination has failed to explore the Wall Street connection adequately, even though Thompson was in New York for UnitedHealth’s annual investor day. I know how important investor days are to big corporations because I used to help plan Cigna’s. Top executives spend many hours preparing for this day because of who is invited: the institutional investors who own most of the company’s shares and those financial analysts who work at big investment banks and “cover” the industry, like high-paid journalists, for the investment community. Unsurprisingly, patients are not invited to these events and the word “patient” is rarely, if ever, mentioned, while “profit margins” and “shareholder value” are uttered frequently.
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In my first book, “Deadly Spin,” I described the last investor day I helped plan. It took place at New York’s Mandarin Oriental Hotel, not far from where Brian Thompson was murdered, in early December 2007. As I recall, Cigna spent a quarter-million dollars of its customers’ money on that six-hour meeting, including $60,000 just to feed the 150 investors, analysts, and Cigna executives who had been invited. Another $50,000 covered the speaking fee of the author of a book extolling the supposed merits of high-deductible health plans, euphemistically marketed at the time as “consumer-driven” health plans (CDHPs), that Cigna and its competitors had begun embracing. The industry’s overall strategy was to move as many health plan enrollees as possible, and as soon as possible, into CDHPs because of their defining feature: a mandate that patients must spend hundreds and often thousands of dollars out of their own pockets before their coverage will kick in.
The investors and analysts were fully on board with this so-called “consumerism” strategy. They knew that the more patients had to pay out of their own pockets for medically necessary care, the more money would be available to reward shareholders.
I would walk away from my job a few months later after a crisis of conscience triggered by the death of a 17-year-old girl just hours after Cigna caved to public pressure and agreed to cover the transplant that, if not for several days of delay, could have saved her life. That incident triggered justifiable public outrage days before that 2007 Cigna investor day, which cost approximately the same amount as the transplant the company initially denied Nataline Sarkisyan. Delays, it turns out, can be just as deadly as denials. And I knew that CDHPs, or whatever “innovation” Big Insurance came up with next, would create new barriers that patients would have to try to overcome to get the care they needed. I didn’t have it in me anymore to keep deceiving the public.
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I would ultimately become an industry whistleblower and go on to testify before Congress when lawmakers were debating legislation that would become the Affordable Care Act. My overriding message every time I appeared before a congressional committee was to warn against what I saw as the biggest threat to Americans being able to get the care they need at a price they can afford: the relentless profit demands of Wall Street, its growing entanglement in the health care sector, and how it is adversely impacting patient care.
As I explained to lawmakers — now more than 15 years ago — for-profit insurers like UnitedHealth and Cigna must assure investors and financial analysts every three months that they know how to control their health plan enrollees’ use of medical goods and services so that plenty of their premium dollars can be diverted to profits. Congress would ultimately include language in the ACA to require health plans to spend at least 80% to 85% of premiums insurers take in on enrollees’ care, known as the medical loss ratio. But big insurers have figured out if they also become health care providers — by buying physician practices, clinics, and pharmacy benefit managers — they can meet that threshold by paying themselves and avoiding payment for their customers’ care.
An argument could be made that the medical loss ratio provision of the ACA has contributed to or even fueled the vertical integration of the big insurers, UnitedHealth especially. UnitedHealth is massively bigger and more profitable than it was on the day I first testified as a whistleblower, June 24, 2009, when it ranked 21st on the Fortune 500 list of U.S. companies. Its share price at the close of trading that day was $24.81. Hundreds of acquisitions later, UnitedHealth is now the fourth largest U.S. company — just behind Walmart, Amazon, and Apple. At the end of trading on Monday of this week, the share price was $560.62. That’s an increase of more than 2,100% since June 24, 2009. By comparison, the Dow Jones average has increased 438%.
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In the years since then, UnitedHealth, Cigna, and a handful of other New York Stock Exchange corporations have cemented their roles as unelected gatekeepers to care, and Americans are now waking up as they never have before to the consequences of that. If their rage can be harnessed and channeled, that dike the industry built might just give way.
Decades ago, the health insurance business put in place a dike to hide and contain the public’s disdain for for-profit health insurers, and to keep reformers at bay. Now, that dike might collapse.
advertisement
As the former VP of corporate communications at Cigna, I played a role in building and fortifying that dike. Every year, my colleagues and I across the industry devoted massive amounts of the money — money our customers paid us to cover their medical care — on lobbying, campaign contributions, deceptive PR campaigns, and even charitable donations to buy goodwill. All of that was spent for the sole purpose of maximizing shareholder return. Restricting patients’ access to needed care made UnitedHealth, Cigna and a handful of other big insurers Wall Street darlings, and made lots of people lots of money while doing little to enhance care.
Much of that spending was to create the illusion that we Americans are happy with our health care system and don’t want politicians to get any bright ideas about changing it. Just three weeks before the tragic killing of United’s Brian Thompson, AHIP, the industry’s biggest PR and lobbying group, touted a recent “survey” that found “a strong majority are satisfied with their current employer-provided plans.” But I am doubtful. The survey was produced by a D.C. strategic communications firm founded by political operatives to manage corporate reputations and “shape perceptions.” AHIP is funded primarily by UnitedHealth and the other big for-profit middlemen whose fortunes depend on remaining in the good graces of those investors and a handful of Wall Street financial analysts.
Media coverage I’ve seen so far of this shocking corporate assassination has failed to explore the Wall Street connection adequately, even though Thompson was in New York for UnitedHealth’s annual investor day. I know how important investor days are to big corporations because I used to help plan Cigna’s. Top executives spend many hours preparing for this day because of who is invited: the institutional investors who own most of the company’s shares and those financial analysts who work at big investment banks and “cover” the industry, like high-paid journalists, for the investment community. Unsurprisingly, patients are not invited to these events and the word “patient” is rarely, if ever, mentioned, while “profit margins” and “shareholder value” are uttered frequently.
advertisement
In my first book, “Deadly Spin,” I described the last investor day I helped plan. It took place at New York’s Mandarin Oriental Hotel, not far from where Brian Thompson was murdered, in early December 2007. As I recall, Cigna spent a quarter-million dollars of its customers’ money on that six-hour meeting, including $60,000 just to feed the 150 investors, analysts, and Cigna executives who had been invited. Another $50,000 covered the speaking fee of the author of a book extolling the supposed merits of high-deductible health plans, euphemistically marketed at the time as “consumer-driven” health plans (CDHPs), that Cigna and its competitors had begun embracing. The industry’s overall strategy was to move as many health plan enrollees as possible, and as soon as possible, into CDHPs because of their defining feature: a mandate that patients must spend hundreds and often thousands of dollars out of their own pockets before their coverage will kick in.
The investors and analysts were fully on board with this so-called “consumerism” strategy. They knew that the more patients had to pay out of their own pockets for medically necessary care, the more money would be available to reward shareholders.
I would walk away from my job a few months later after a crisis of conscience triggered by the death of a 17-year-old girl just hours after Cigna caved to public pressure and agreed to cover the transplant that, if not for several days of delay, could have saved her life. That incident triggered justifiable public outrage days before that 2007 Cigna investor day, which cost approximately the same amount as the transplant the company initially denied Nataline Sarkisyan. Delays, it turns out, can be just as deadly as denials. And I knew that CDHPs, or whatever “innovation” Big Insurance came up with next, would create new barriers that patients would have to try to overcome to get the care they needed. I didn’t have it in me anymore to keep deceiving the public.
advertisement
I would ultimately become an industry whistleblower and go on to testify before Congress when lawmakers were debating legislation that would become the Affordable Care Act. My overriding message every time I appeared before a congressional committee was to warn against what I saw as the biggest threat to Americans being able to get the care they need at a price they can afford: the relentless profit demands of Wall Street, its growing entanglement in the health care sector, and how it is adversely impacting patient care.
As I explained to lawmakers — now more than 15 years ago — for-profit insurers like UnitedHealth and Cigna must assure investors and financial analysts every three months that they know how to control their health plan enrollees’ use of medical goods and services so that plenty of their premium dollars can be diverted to profits. Congress would ultimately include language in the ACA to require health plans to spend at least 80% to 85% of premiums insurers take in on enrollees’ care, known as the medical loss ratio. But big insurers have figured out if they also become health care providers — by buying physician practices, clinics, and pharmacy benefit managers — they can meet that threshold by paying themselves and avoiding payment for their customers’ care.
An argument could be made that the medical loss ratio provision of the ACA has contributed to or even fueled the vertical integration of the big insurers, UnitedHealth especially. UnitedHealth is massively bigger and more profitable than it was on the day I first testified as a whistleblower, June 24, 2009, when it ranked 21st on the Fortune 500 list of U.S. companies. Its share price at the close of trading that day was $24.81. Hundreds of acquisitions later, UnitedHealth is now the fourth largest U.S. company — just behind Walmart, Amazon, and Apple. At the end of trading on Monday of this week, the share price was $560.62. That’s an increase of more than 2,100% since June 24, 2009. By comparison, the Dow Jones average has increased 438%.
advertisement
In the years since then, UnitedHealth, Cigna, and a handful of other New York Stock Exchange corporations have cemented their roles as unelected gatekeepers to care, and Americans are now waking up as they never have before to the consequences of that. If their rage can be harnessed and channeled, that dike the industry built might just give way.
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