Film-maker says diplomats made up the story to discredit film that showed healthcare was worse in US than Cuba

American diplomats made up a story that Cuba banned Michael Moore's 2007 documentary, Sicko, in an attempt to discredit the film which painted an unflattering picture of the US healthcare system, the film-maker said today.

A confidential US embassy cable released by WikiLeaks claimed that Castro's government banned the Oscar-nominated film because it painted such a "mythically" favourable picture of Cuba's healthcare system that the authorities feared it could lead to a "popular backlash".

But Moore said that far from being supressed by Havana, the film – which attempted to discredit the US healthcare system by highlighting what it claimed was the excellence of the Cuban system – was shown on national television.

The film-maker said on his blog that the diplomatic cable, dated 31 January 2008, was "a stunning look at the Orwellian nature of how bureaucrats for the state spin their lies and try to recreate reality (I assume to placate their bosses and tell them what they want to hear)".

He added: "The entire nation of Cuba was shown the film on national television on April 25, 2008! The Cubans embraced the film so much so it became one of those rare American movies that received a theatrical distribution in Cuba. I personally ensured that a 35mm print got to the Film Institute in Havana. Screenings of 'Sicko' were set up in towns all across the country."

The confidential US memo claims that when the film was shown to a group of Cuban doctors, some became so "disturbed at the blatant misrepresentation of healthcare in Cuba that they left the room".

It claims the film was banned because the Cuban government "knows the film is a myth and does not want to risk a popular backlash by showing to Cubans facilities that are clearly not available to the vast majority of them".

Sicko investigated healthcare in the US by comparing the for-profit, non-universal US system with the non-profit universal health care systems of other countries, including Cuba, France and the UK.

It was nominated for an Oscar for best documentary feature but was also castigated for being naive and tendentious.

The cable comes from the United States Interests Section in Havana (USINT) – staffed by US foreign service personnel and local staff employed by the department of state, the unit is formally a section of the Embassy of Switzerland, although it operates independently of the Swiss in virtually all but protocol respects.

The secret 2008 cable is based on reports from the USINT's foreign service health practitioner (FSHP) supposedly based on her conversations with local people, unauthorised visits to Cuban hospitals, and experience of helping USINT American and Cuban personnel access healthcare.

The cable describes a visit made by the FSHP to the Hermanos Ameijeiras hospital in October 2007. Built in 1982, the newly renovated hospital was used in Michael Moore's film as evidence of the high quality of healthcare available to all Cubans.

However, according to the FSHP, the only way a Cuban can get access to the hospital is through a bribe or contacts inside the hospital administration. "Cubans are reportedly very resentful that the best hospital in Havana is 'off-limits' to them," the memo reveals.

According to the FSHP, a more "accurate" view of the healthcare experience of Cubans can be seen at the Calixto García Hospital. "FSHP believes that if Michael Moore really wanted the 'same care as local Cubans', this is where he should have gone," the cable states.

A 2007 visit by the FSHP to this "dilapidated" hospital, built in the 1800s, was "reminiscent of a scene from some of the poorest countries in the world", the cable adds.

The memo noted that even the Cuban ruling elite leave Cuba when they need medical care. Fidel Castro, for example, brought in a Spanish doctor during his health crisis in 2006. The vice minister of health, Abelardo Ramírez, went to France for gastric cancer surgery. The neurosurgeon who heads CIMEQ [Centro de Investigaciones Médico-Quirúrgicas] hospital – widely regarded as one of the best in Cuba – came to England for eye surgery, returning periodically for checkups.

"After living in Cuba for two and a half years, treating numerous Cuban employees at USINT, and interacting with many other Cubans, the FSHP believes… preventive medicine in Cuba is a bygone ideal, rather than the standard practice of care," the memo concludes.

Moore said on his blog that the cable came in the wake of the US health insurance industry deciding to "to spend millions" to go after him and, if necessary, "push Michael Moore off a cliff".

He said the industry worked with anti-Castro Cubans in Miami in order to have them speak out and smear the film.

"So, on January 31, 2008, a state department official stationed in Havana took a made-up story and sent it back to his HQ in Washington," said Moore.