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July 2nd, 2009
06:49 AM ET

Health insurance 'insider' speaks out

[cnn-photo-caption image= caption="Wendell Potter is the former chief spokesman for health insurance giant Cigna."]

By CNN's Jim Acosta & Bonney Kapp

Last year, Wendell Potter stepped down from his post as the chief spokesman for the health insurance giant, Cigna. Potter tells CNN he is finished with defending an industry he calls “beholden to Wall Street.”

At a hearing last week before the Senate Commerce Committee, the former vice president of corporate communications at Cigna testified, “I know from personal experience that members of Congress and the public have good reason to question the honesty and trustworthiness of the insurance industry."

The committee’s chairman, West Virginia’s democratic Senator Jay Rockefeller told Potter, “you are better than Russell Crowe on ‘The Insider,’” referring to the award-winning 1999 film about cigarette company executive Jeffrey Wigand who blew the lid on the tobacco industry’s practices.

In his testimony and in an interview with CNN, Potter described how underwriters at his former company would drive small businesses with expensive insurance claims to dump their Cigna policies. Industry executives refer to the practice as "purging," Potter said.

“When that business comes up for renewal the underwriters jack the rates up so much the employer has no choice but to drop insurance,” Potter said.

CNN obtained a transcript of a 2008 Cigna conference call with investors in which company executives use the term “purge.”

But in an email to CNN, Cigna spokesman Chris Curran denied the company engages in “purging.”

“We do not practice that. We will offer rates that are reflective of the competitive group health insurance market. We always encourage our clients to compare our proposed rates to those available from other carriers," Curran said.

Potter started thinking about leaving Cigna in 2007 after he visited a medical charity event held at a Virginia fairground.

"It was almost like an electrical jolt," Potter said.

At the event, Potter took pictures of doctors offering free health care to the uninsured.

"The volunteer doctors were seeing patients in barns, people in animal stalls,” Potter said. “It changed it for me.”

He says he finally decided to quit after Cigna’s controversial handling of an insurance claim made by the family of California teenager, Nataline Sarkysian.

In 2007, the Sarkysian family made repeated public appeals at news conferences for Cigna to approve a liver transplant for the 17-year-old, who was suffering from leukemia. Cigna initially declined to cover the treatment, then reversed its decision.

Sarkysian died shortly after the company’s reversal.

As Cigna’s spokesman during the controversy, Potter had no role in the decision to deny coverage. But he was inundated with angry phone calls from the public.

“After she died my voice mail and my email inbox were just filled with messages from people who were just outraged, " Potter said.

Now a senior fellow on health care for the public watchdog group, “Center for Media and Democracy,” Potter is speaking out on efforts to reform his former industry.

He supports legislation that would give Americans the option of joining a government health care plan.

Potter is also taking aim at some of the TV commercials aired by groups opposed to reform.

One such ad caught Potter’s eye. Run by the conservative organization, Patients United Now, the ad claims “now Washington wants to bring Canadian-style health care to the U.S."

"Sometimes you'll see misleading information. And sometimes you'll see outright lies, like that (ad) is," Potter said referring to the spot.

Patients United Now spokeswoman Amy Menefee disagrees.

"We're not saying there's a Canada health care act of 2009,” Menefee said. “It is a trend. It's trending in that direction."

Potter notes that the leading proposals for health care in Congress do not seek to set up Canadian-style health care in the U.S. He says claims that reform would lead to “rationing” of care are missing his point.

“What we have is rationing by corporate executives who are beholden to Wall Street. And it happens all the time," Potter said.

Filed under: Health
soundoff (23 Responses)

    As a person who knows what it is like to "Blow the Whistle" on a huge corporation my hat is off to Wendell Potter for speaking up for what is right.
    I did a similar thing along with 5 other associates that ended up in the Department of Justice fining Eli Lilly & Co. over 1.4Billion in January of this year. It is not an easy road to follow or easy decision to make, but once you have made up your mind, you know you have made the right choice. One does not know the toll it takes on a person (not to mention his family) who speaks out against a company such as Lilly or Cigna when the easy option is doing nothing. But when it comes down to what is right and what is wrong –it becomes an easy decision. When one works for a company for several years that tends to be their life and the company is often a huge part of your life. It is easy to follow the company line and take the easy road. It is easy to settle in to the company line or the corporate "kool-aide" to believe what you are doing is okay and part of the corporate world. What is difficult is the decision to say to yourself that "hey what is going on in my company is wrong (plus illegal) and everyone knows it, but nobody is speaking out until you decide that I can no longer take the corporate side and I' m going to tell the truth. I look back at some of my fellow workers and can't believe that they look at me as the enemy because I did the right thing. This becomes however an easier decision when you know that by you stepping forward lives will be saved in the long run.
    For that I salute Wendell Potter for his courage to come forth. As I look back over a 7 year trail that my decision took me, at a few times I wished I had not spoken up, but truly knowing inside that I would do it again in a heartbeat if confronted with the same choice. Mr Potter is a hero in my eyes since I think I know how difficult it was for him to come forward and tell all Congratulations to you MR. Potter and all others like you in our world that don't take the corporate line and speak out against what is morally wrong.
    Jacksonville, Or

    July 2, 2009 at 8:25 pm |
  2. Benjamin

    Healthcare reform as a whole is a topic which is not to be considered solely from the viewpoint of the Insurance companies as the bad guys out to rob you of your money. Does this mean healthcare does not need to be reformed? Or for that matter make health insurance companies completely honest? Absolutely not. But I can't name a single industry over the last century which has. And I doubt many of the readers would be able to either.

    For the readers who believe there should be a government health insurance program option: I believe you are mistaken by saying the reason their is resistance from the private sector is purely from economic competition. The fear is from government subsidized or "supercharged" health insurance plans which forcefully drive the private companies out of business. There is nothing stopping the government from continually depressing prices as the gov't doesn't have to make a profit from the program. So, unlike the private companies which have to report earnings to wall street, the Government can bully all it wants.

    Is this fear legitimate? One cannot be sure. Rational? Absolutely. There are greater things at work than the "Let's do as much damage to the consumer because we the insurance companies are monsters." argument being put forth. A Government health insurance plan may succeed. Or it may achieve an utter destruction of the private insurance business. One cannot know until such legislation is passed.

    And for those who believe Gov't healthcare plans are a sign of armageddon: you are also mistaken, unless extroardinary circumstances take place. Clearly President Obama hasn't given much to the far left yet (i.e. Gay rights), and I don't see a socialistic undertaking/undermining of the private healthcare system ensuing during this presidency. Further, a Gov't plan without subsidies with fair market competition can in fact reduce prices in a significant way for the low/middle class earner. This would be a great thing for the consumer in such a difficult economic climate.

    But finally consider that health care is a huge business because everyone needs it. All 300+ million people within the U.S.A need care. There are more than Billions at play, there are lives. Reformation is a must and will come. The extent of reformation must be controlled. Only time will tell how our health care will be in the next 20 years.

    July 2, 2009 at 4:17 pm |
  3. annice meeker

    Medicare and Atena are the worst.

    July 2, 2009 at 3:57 pm |
  4. Richard

    Every businessman knows the largest cost in business is people.
    How can the government, by adding an additional layer of administrative, non-patient care employees expect to lower healthcare costs, and yet be competitive with the existing healthcare structure.
    IT WON'T, and we will end up paying for it with the cost of additional federal employees and their benefits.
    I say leave it alone, it's not perfect but it works!

    July 2, 2009 at 10:32 am |
  5. Skip Reynolds

    Good stuff!!! New this was happening but good to hear someone from there actually saying so. Insurance companies are all about profit, not providing the best health care possible.

    July 2, 2009 at 9:53 am |
  6. Greg

    It is past time to DUMP the Health Insurance industry. The health insurance monopoly has a strangle hold on our health care system and is squeezing it for every dollar they can. They know it, doctors know it, and the polititans who are in the pockets of health insurance companies know it.

    July 2, 2009 at 9:37 am |
  7. Sofie

    Thank you Jim Acosta for bringing this eye opener re: Walter Potter's story, to the public. I hope CNN reruns this several times and that you stay on top of the insurance debacle. A Public Option is common sense, especially after a story like the one you reported..

    July 2, 2009 at 8:57 am |
  8. Mark

    Wow, you mean private insurance cos. would only make millions, instead of billions, boo-hoo! We cannot even afford to feed our children, our get a check-up, without fear of turning into a pre-existing condition.
    I actually got dropped from my insurance co. beacause of this, the cause: Degenerative disc Disease, something I cant even control, so now, I'm disabled and cant work, what a shame!
    We are slowly working towards the conditions of third world countries where the well- to-do, are the only ones with any kind of proper health care. Land of the free, to die, if you dont have the money! Sounds harsh, but you dont want to get into my personal story of over a year without health coverage, when MRI shows L5-S1 disc is completely gone,with 2 other discs on their way.
    You saw the people, being treated in a barn, kinda looked like a Peace Corps commercial, but instead, it is happening all over the US!
    I'm done, I know nothing will be done, as long as politicians have a say.
    People might want to consider some protesting of their own, and us, the people take our country back!

    July 2, 2009 at 8:51 am |
  9. Chris van Hooren

    Bravo...both to CNN for airing this and to Mr. Potter who is obviously a man of integrity.When more Senators hear and pay attention to Mr. Potter's experience, mimick his ethical behavior, and stop accepting the insurance/medical industry's campaign contributions, then the public option will sail through the Senate. This is what of 73%Americans want.

    July 2, 2009 at 8:45 am |
  10. William Courtland

    For health insurance to be secure: the horrorists must be stopped: horrorists are the force of creation for the motive of terrorists. Horror is above terror: to understand the requirement in anger to drive a man to murder: to understand such toment equates to horror.

    Stock is a traded unit of sale: a refrigerator is a unit of stock, a package of bran muffins is a unit of stock, a nick-nack is a unit of stock...

    An investment is a bond: a bond is purchased with the understanding that one will invest: just as bonds are sold by the government: bonds must be senate controlled and collectivelly contracted for such sale and true rating of risk and final growth. Bonds should not yeild a massive growth for the bond holder: it is just a place for investment savings: yet bonds in quantities can offer deals on the purchase of invested products and services: just as a GM dealer makes total profit for owning its first stock: a dealer which holds bonds in GM would gain a discount for wholesale if the bonded number was high enough: though could never out-gain GM itself unless GM sold majority bonds to a private owner.

    To insure Insurance: inflation must be stopped.

    July 2, 2009 at 8:44 am |
  11. Hubert Bertrand Oberlin La.

    We will never have a reform. Congress get too much easy money from the crooks in health care, They are paid for reform to fail.

    July 2, 2009 at 8:40 am |
  12. Hubert Bertrand Oberlin La.

    We have always known ,Politicians, and CEO's of big companys are stealing the public blind. They tell congress what to do. Lobby is bribe. When people receive money for a favor, that is bribe.NOT lobbing.I watch (CNN) all day. I'm retired, I think (CNN) knows that big oil.,Insurance co. drug co. and all big money makers use CNN & FOX and anyway to cheat the people.

    July 2, 2009 at 8:32 am |
  13. Mannuel Felipe Munera

    Good morning; it seems that what needs to be done first is to recognize the need for a clean reform. Second, private healthcare can be offered together w/ state subsidies for lower incomes.
    Maybe being able to pay for health care based on your icome could be one solution. It could be your income w/in the last three mos., that way incomes would accomodate any fluctuations on the actual net income being submitted by the patient.
    Simply put, private health for those who have, and State sponsored health for those who do not have.
    The altruistic idea of medicine is again asking for a just balance b/tween purpose and income for all those who profess it.

    July 2, 2009 at 8:32 am |
  14. Sheryl Harnas

    There is no viable, honest company that would fear competition from a government run insurance program. Fear of competition suggests that total reform is needed.

    July 2, 2009 at 8:26 am |
  15. William Courtland

    The Health of the Nation first...

    Insurances found kept in non-fiat equity: has a stable net value: but can not easily be liquified for use: fiat savings under an Insurance agency can be easily liquidated: but ride the inflation rate and are only supported by the nation itself: meaning if America suffers any type of social collapse: fiat will become worthless: thus insurance fund will also become worthless.

    The health of the Nation:

    Looking at the morgage crisis of Fannie May and Freddy Mac... Now a home will increase in equity as the inflation rate increases: supporting or having bad resident's in a home does not make that home any less valuable: the banks still own/hold the equity of the home itself: thus are stable in the ownership of equity to hold net value in auditing or equity stocks. The property is the problem.

    The property values decreased: this drove home prices down: but what can cause property values to decrease?

    The stability of the community has been in recent times shaken: terrorism played a part: as communities in some places fell to hatred of each other: but the main cause America has lost economic stability: and in truth is no longer the leader in finance or the leader of the free world: this truth costs the net property value of land to decrease.

    So what happened to American national stability? Well first America stopped technologically advancing: why did that stop?

    American citizens as part of a global occult started using young male geniuses to create scripts from the prophecy raped from them: the occult would then proceed to eliminate the child. It is true that all of America's top technological advancements have been taken from the real world and placed on the big screen by people without the imagination to innovate or create unique or original material: so they used a power of life to rob the future of its worth. American property values are suffering the reaction due to sorcery. Sorcery and this occult via hypnosis runs the party system.

    America is decaying due to the denial of sorceries existance. Does it not then make sense then that such a truth is a threat to the entire free world market? I might not be an American citizen: but a route to the supreme court of Canada: with a lawsuit against the American public as they have failed in the true citizen leadership of their nation seems appropriate: luckely for you have been robbed nearly blind by those occult members and can not afford a lawyer.

    Because somewhere in your nation... men go violently insane because they have been tormented by sorcery to their breaking point.

    July 2, 2009 at 8:21 am |
  16. Doug in Reedville VA

    The insurance industry has purges built into the process consider
    If you can not work due to injury or disease, how do you get health care insurance?
    Current insurance? Your are not able to work so no company supplied insurance.
    Spouse insurance? No coverage, not married, needed as care giver.
    Cobra? Not if small business or religous organization, expensive
    Medicare? Not until after 24 consecutive months on social security disability.
    Resulting in you with no health insurance coverage just when you may need it the most.

    July 2, 2009 at 8:18 am |
  17. Sandra

    Thank goodness someone is getting honest about this. I am a healthcare provider and have been outraged by insurance company practices for years. Those advocating against a government run program don't know what they're talking about. After the mess the economy is in after unfettered business practices that pursue profits with greedy insatiability, it's hard for me to imagine why anyone would advocate to leave things solely in private hands. I hope the government will listen to this man's courageous statements.

    July 2, 2009 at 8:18 am |
  18. Megan in FL

    I was responsible for employee benefits for 30 years before I retired; one of my responsibilities was dealing with problems encountered by our employees’ company sponsored health care. I could write a book about all of the underhanded techniques Aetna, United Health Care and Blue Cross/Blue Shield used to keep from having to pay for our employee’s medical expenses.

    If you have money to fight these big companies you should feel comfortable with the status quo. If you’re uninsured or poor, you should write to your elected officials and tell them you want them to vote for “Healthcare Change!!” Greediness has gotten us into this mess and the private insurance companies are just as greedy as Wall Street…if not more!! Don’t be fooled with their TV ads, they’re “propaganda!”

    July 2, 2009 at 8:17 am |
  19. Pat

    At least when the insurance drops you, you can still get treatment even though you will owe money.

    I would be covered with the new government Health plan, but when they say NO it will be to treatment. The other day someone from the Obama administration said as much, when answering questions, he stated part of lowering the cost was a need to have someone say NO to the patient.

    July 2, 2009 at 8:16 am |
  20. Hector

    It is time for insurance companies to get back to basics, were the more important part of the business are the patients. There is nothing wrong with capitalizing on health, but the line has to be drawn.

    July 2, 2009 at 8:12 am |
  21. Carol Kellogg

    The bread and butter of medicine is childbirth money. Midwife here since 1971 and we're going to make the changes.

    July 2, 2009 at 8:07 am |
  22. Larry

    Insurance has just become another scam in this country. That's why there's so much resistance to health care reform...a lot of politicians are in the pockets of insurance lobbyists.

    Bankers, mortgage companies, insurance agencies...they're all cut out of the same foul material.

    July 2, 2009 at 7:29 am |
  23. Bob in Florida

    We can only hope this kind of disclosure will help push Congress to act on the behalf of the American people, not their cronies and financial backers.

    July 2, 2009 at 7:12 am |