The healthcare system is unsustainable; without a Medicare for All system, only the wealthiest will be able to afford decent care – Wendell Potter on Reality Asserts Itself with Paul Jay

Story Transcript

PAUL JAY Welcome back to Reality Asserts Itself on The Real News Network. I’m Paul Jay. And we’re continuing our discussion about health care and more with Wendell Potter. Thanks for joining us again.

WENDELL POTTER Thank you, Paul.

PAUL JAY So you’ve got to watch the previous segments. You’ll get Wendell’s story. Let me just mention one more time his book Deadly Spin: An Insurance Company Insider Speaks Out on how Corporate PR Is Killing Healthcare and Deceiving Americans.

So we’ve talked in the previous couple of segments about what’s wrong with the Affordable Care Act, Obamacare, that has really benefited insurance companies in the end more than it did most people. Some of the reforms are positive, compared to no ACA. But not nearly what it seemed, what it was promising. So the debate in the Democratic Party now is fix ACA, because you can’t pass Medicare for All if it’s going to be called socialist, which is what the Republicans are calling it, and even some Democrats? And of course, socialism is terrible. Imagine having a right to health care when you’re born. It’s kind of funny, growing up in Canada, which is not a socialist country, and a lot of people actually wished it was, but that being said, practically part of the Canadian identity is being proud of having socialized health care. But that being said, the politics of the Democratic Party–and I think a lot of this will play out in the primary–will be that fixing ACA is a lot more doable than trying to pass Medicare for All, if for no other reason that the private insurance companies will go to war with the Democratic Party to stop Medicare for All. Anyway, what do you make of this debate?

WENDELL POTTER Well, a lot of Democrats, the ones that I would refer to as corporate Democrats, those who take a lot of money still from corporate interests, including health care interests, they’re under the influence of the lobbyists for those companies, and have been persuaded by those lobbyists that private insurers have a legitimate role to play in our health care system.

PAUL JAY So under the influence means they’re getting money.

WENDELL POTTER Exactly right. They’re getting big campaign checks. The Democratic Congressional Campaign Committee brings in a boatload of money from health insurance companies and health care providers, so they don’t want those checks to stop. So they are in many cases not favoring Medicare for All because insurance lobbyists don’t want that. They’re under some delusion that the insurance industry will be more favorably inclined to support some half measures; something that would, for example, create a public option, which is something that the insurance industry will fight just as fiercely as moving to Medicare for All.

PAUL JAY Well, let’s let’s stop there for a minute at the public option, because back in 2009 before the ACA hearings began you thought a public option should be on the table. It really wasn’t. There was a talk of public option, Obama kind of mentioned it, but certainly his heart was never in it. He didn’t give it any real play. And it got off the table pretty fast. A public option, if I understand it correctly, you can go to these exchanges, and you’d be able to choose private insurance. But if you wanted to there would be a Medicare-style plan you could buy into. Now, since ACA, and more recently, a lot of the advocates of Medicare for All, including like the nurses union and others, they don’t want a public option on the table. They think it’s kind of a distraction from getting Medicare for All, and they just want this focus on Medicare for All. What do you make of this public option versus just full blown Medicare for All?

WENDELL POTTER Well, you’re right. During the debate on what became the Affordable Care Act, I supported the creation of a public option. The reason was because there was no talk about moving to Medicare for All, for one thing, and a public option was as good as we possibly could get.

PAUL JAY Well, there was talk. Sanders and others were talking about it. But it certainly wasn’t on the table in terms of the Democratic Party politics of the day. I mean, Obama was against it.

WENDELL POTTER He was against it, although at some time in his past he’d said we needed to have it. And if we could start all over again with a clean slate, that’s what we should have. But during his presidency he certainly was not receptive to any conversation about moving to a Medicare for All type of system. So that’s all we could get back then. It was the one thing that I thought might make sure, even as Obama said, as you correctly noted, he was not so strongly in favor. But he at one point did say that we needed to have a public option, if for no other reason than to keep private insurance companies honest. I agreed with that. This could have, could have possibly had been a way that could have created a new competitor for private insurance companies.

PAUL JAY The critique of public option I’ve heard is that it would allow the private insurance companies to cherry pick. They could kind of force, through deductibles and other means, people off who have illnesses and need a lot of health care into the public option and out of the private option, and actually just increase their profitability.

WENDELL POTTER And that’s exactly what more than likely would happen if such a public option were created now. Keep in mind they fiercely fought that they didn’t want to have any kind of a new competitor. But if you create a public option you’re just adding to complexity, and you are probably, the way it would be structured, would indeed-

PAUL JAY So you’re opposed to that now. You think there needs to be just a move to Medicare for All.

WENDELL POTTER Absolutely. As long as you keep private insurance companies in the mix you’re never going to be able to have a system that is less complex and less expensive than the one we have now. Insurance companies are middlemen who serve no real purpose in this country. A few years ago, before I left my job at Cigna, I was in a leadership meeting with the CEO. One person asked him, what keeps you up at night? And he said ‘disintermediation,’ which was a term that we all almost had to look up. But he said that what he was afraid of was that if the company’s customers, their employers in particular, employer customers, would come to question the value proposition of private insurance companies. And we’ve reached that point now. In other words, we have reached the point that employers are looking to disintermediate, to get rid of a middleman in this health care system. They add cost rather than remove costs from the system. They are barriers for people to getting the care that they need. So it has to be eliminated. There is no way that we’re ever going to get our costs under control or get anywhere close to having a majority, more of our people covered, as long as we have private insurance companies in the mix. I’m confident of that.

PAUL JAY Okay. I think it’s worthwhile giving a little historical context here, because most of the industrialized world has one form or another of a government health insurance plan, and has little to no private insurance companies. But not the United States. So let’s talk a little bit about the history. If you could look at the development in Canada versus the U.S., in the 19–I guess the late ’50s, ’60s, you have in the province of Saskatchewan with Premier Tommy Douglas, brings in a government health care plan in one province. And it becomes very popular, and there’s a big fight eventually to have a nationwide plan. But that fight is not so much with private insurance companies, because if I understand it correctly, they’re mostly non-profits. The fight is actually with the Canadian Medical Association, and with doctors, who–interesting enough, now the majority of doctors actually love the health care plan, because unlike the British system, they actually are still private. Most doctors–although hospitals are public–most doctors have private practices, and work with a very regulated government health insurance plan. But why didn’t that happen here? When you can–when it makes so much sense, even for big industries. Like, one of the big supporters of the Canadian health care plan was General Motors. Their cost of producing a car was far less in Canada than in the United States because of this health insurance plan. Why didn’t it kind of naturally evolve that way here, as it did so many other places?

WENDELL POTTER You know, it’s interesting. The American Medical Association was even more powerful than the Canadian Medical Association, and they were able to almost stop the creation of the Medicare program. The fiercest opponent to the creation of Medicare was the American Medical Association. The insurance industry, they weren’t necessarily on the sidelines. They were not supporters. But it was the AMA that was leading the opposition to this.

But we–our system was very comparable, very similar to the system in Canada, up until Tommy Douglas and the creation of what became the Canadian system.

PAUL JAY You mean mostly nonprofit health insurance companies.

WENDELL POTTER Right, exactly. It wasn’t until the ’80s and ’90s that a lot of the nonprofit insurance companies began to convert to for-profit status, and a lot of big life insurance companies–Cigna, the company I worked for–was a traditional multiline insurance company that sold property and casualty insurance, and reinsurance and financial services. That company, and Aetna was similar. They decided, well, we can get into healthcare. We can some bucks over here. And they were for-profit companies.

PAUL JAY Maybe I didn’t make it clear enough. In the Canadian situation the insurance companies where almost all nonprofit.

WENDELL POTTER And they were in this country, initially.

PAUL JAY So when the fight takes place for government health insurance, there isn’t a big not for profit health insurance industry. But here there becomes–it becomes very important to the insurance companies.

WENDELL POTTER It does. It does. In this country we never, like Canada, had any debate that went anywhere to develop a national health care system. It has been attempted over many years, going back to even Teddy Roosevelt. But certainly during the Truman administration, Truman was really pushing for a system that would have been much like Canada’s. And subsequent presidents have thought about it. But there’s always been such entrenched opposition because of the power of the American Medical Association, and the growing power over time of the insurance industry, certainly as it began to convert to for-profit status. So we never really got to the point that most other developed countries were able to get to in terms of having a national debate to create a truly national health care system.

PAUL JAY And who drove the privatization of the nonprofit health insurance sector?

WENDELL POTTER Two ways. One, a lot of the nonprofit [blues] began to decide that they could convert to for-profit status, and they felt there was some benefit to that. But also you had big companies like the ones that I worked for, at least Cigna, that decided they could make some money in health care, and moved into it. So you had some very rapid change from nonprofit to for-profit status.

PAUL JAY What years are we talking about?

WENDELL POTTER We’re talking about the late ’80s through the ’90s, and the early 2000s. You saw that as the blues, some of the blues began to convert–Blue Cross Blue Shield plans–convert to for-profit status, they now, many of them, are part of a very large company called Anthem, which owns a lot of the Blue Cross plans that previously were nonprofit. There still are some in the country, a number of them, that still operate theoretically as nonprofits. Many of them, though, have for-profit subsidiaries. So they make a lot of money for shareholders and their boards.

PAUL JAY All right. Well, let’s get back to the politics of all of this. Joe Biden is in the race for 2020. And right now it’s Biden versus Bernie. Maybe that will change. But in some ways it’s a good thing, because you have two very distinct views, especially on health care. One will argue–and I’m going to argue the Biden side, here–that to take on pharma, to take on private health care insurance companies, to move to Medicare for All and take on that war with Wall Street, in a very important profit center for them, is going to throw that sector behind Trump. And if you think the paramount issue, which a lot of people think, is defeating Trump, then you don’t want to take on that sector, and you need to compromise with that section of finance and try to fix the ACA, to some extent, or you’ll throw a massive amount of Wall Street behind Trump. And Wall Street already is kind of happy with Trump, between the tax cuts and deregulation of Wall Street. I mean, I actually don’t know if it’ll make that much difference anyway, because I think Wall Street kind of loves Trump. On the other hand, they might go for a Biden, because the Obama administration was not that unfriendly to Wall Street. I mean, yeah, Dodd-Frank was passed, and so on. But the truth is, Wall Street did very well under the Obama administration, and they might like a more rational Biden, Wall Street friendly, versus what a lot of people think is a pretty crazy Trump. So what do you make of that argument? Because I think that’s what we’re going to hear a lot of, that argument.

WENDELL POTTER We’ll hear a lot about that, and I’m sure there’s probably some truth to that. But I also know that a lot of the corporate–the big corporate Wall Street Democrats, or you know, they are concerned about this groundswell of support for candidates that are able to amass a lot of of campaign money through small donations. Their power is being challenged, and they don’t like that. And so I think–but what Biden is doing is showing that at least the establishment Democrats are still very much beholden to Wall Street and to big corporate interests. And the other candidates are going to be trying to distinguish themselves from that. A number of them are already. It could be that there will be some money that goes to Trump that might otherwise go to some Democratic candidates. I’m not so certain that that’s the case. We’ll see. But I don’t think that Wall Street necessarily has as much sway over Democratic voters as they once did, particularly with some of the candidates who are certainly shunning Wall Street, and would be Wall Street’s worst nightmare. Certainly Bernie Sanders, probably even more so Elizabeth Warren, and some of the other Democrats that have said they will not take corporate donations.

PAUL JAY So what do you think is the significance of these elections?

WENDELL POTTER I think they’re very significant. I think, as we’ve talked previously, there’s not any chance that Medicare for All will get through this Congress and be signed into law by President Trump. That’s just not going to happen. So the elections couldn’t be more important if this is to advance. And I’m of the opinion that the current health care system is not sustainable. It’s going to collapse at some point. If it doesn’t collapse, it’s going to be a system that is a–that people only who are the wealthiest in this country are going to be able to afford care, and the rest of the population just simply will not be able to get the care that they need.

We already are the only developed country in the world that rations care on the ability to pay. And that’s only going to get worse. And I think you’re going to be seeing not only more and more individuals and families support Medicare for All, but you’re going to see increasingly businesses, small businesses to mid-sized businesses in particular. One of the other things that I have done is agree to serve as president of this organization called the Business initiative for Health Policy. And it’s an organization that makes the business case. Not just the social and moral case, but the business case for moving to Medicare for All, and representing businesses that can no longer afford to offer coverage to their workers. They’re becoming increasingly uncompetitive in the global marketplace if they are having to experience year after year premiums they can’t control.

The founder of the business initiative is a business executive who is calculating that it now costs him $14 an hour per year per employee to offer coverage to his workers, which is ridiculous. So there is no employer that can can do this indefinitely in this country and still be competitive in a global marketplace.

PAUL JAY All right. Thanks for joining us, Wendell. We’ll talk again as the campaign develops. But for now that will be the end of this part of this segment of Reality Asserts Itself. And as I say, we’ll talk many times as this unfolds.

WENDELL POTTER Thanks for the opportunity, Paul.

PAUL JAY And thank you for joining us on The Real News Network and Reality Asserts Itself.