Associated Press/Charlie Neibergall

Wendell Potter, a former insurance executive, ripped into Pete Buttigieg's health plan in an interview with Business Insider.

Potter said he believes the plan is a "godsend" for the insurance industry and will allow it to maintain its grip over American healthcare.

"They'd be happy as clams on the Pete Buttigieg health plan," he told Business Insider.

The Buttigieg campaign defended the plan in statement and noted the insurance industry has also spent millions attacking it.

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A former insurance executive says Mayor Pete Buttigieg's proposed healthcare plan would be "a godsend" for insurers and allow it to exert outsize power in the debate around healthcare reform.

Wendell Potter, President of Medicare for All, an advocacy organization, tweeted on Tuesday that Buttigieg's effort to continue attacking a proposal to insure everyone in the US in the Democratic primary would massively benefit the health industry.

"This will thrill my old pals in the insurance industry, as Pete's plan preserves the very system that makes them huge profits while bankrupting & killing millions," Potter wrote.

He resigned from his position as a senior communications executive at Cigna in 2008 and went on to testify against the insurance industry in Congress.

In an interview with Business Insider, the former healthcare executive said he believed Buttigieg's plan would be a "godsend" for the industry in a system designed to maximize profits at the expense of consumers.

"They'd be happy as clams on the Pete Buttigieg health plan," he said. "It doesn't change much."

Potter criticized a mandate in the proposal compelling people to carry health insurance which could saddle people with multi-thousand dollar fines at the end of the year, given a provision to cap premiums at 8.5% of income. It resembles the least popular part of the Affordable Care Act that Congress repealed under the 2017 Republican tax law.

The former Cigna executive has sought to generate support for universal healthcare, and met with the Sanders and Warren presidential campaigns. But he doesn't plan on endorsing a candidate in the competitive primary.

The Buttigieg health plan mirrors the one that former Vice President Joe Biden unveiled last year, another moderate. Both candidates have faced off against Sens. Bernie Sanders and Elizabeth Warren's support to create a single-payer system in the US, which would cost over $30 trillion over a decade.

Buttigieg's $1.5 billion health proposal is a middle-of-the-road approach. It would create a government-managed plan for people who want it while allowing others to maintain their private insurance. He's touted it as a "glide path" towards universal health coverage.

In a statement to Business Insider, Sean Savett, a spokesperson for the Buttigieg campaign, defended the plan and noted insurers have also spent millions of dollars slamming it.

"Pete's 'Medicare for All Who Want It' plan would make some of the boldest, most progressive changes to our health care system in decades in order to achieve universal coverage for all Americans," Savett said. "It has also been attacked by the health insurance industry because it would create competition and force insurers to lower costs and improve care or lose customers — so that claim doesn't hold up."

In recent months, the health industry has spearheaded a multimillion dollar effort to throttle proposals for Medicare for All.

It often lumps modest attempts at reform — such as Buttigieg's plan — alongside universal healthcare and industry groups warn it could lead to a "one size fits all" system with hospital closures and longer wait times to receive medical care.

Still, the effectiveness of a public option depends on its strength. It would likely still shake up the healthcare system and empower the government to negotiate with providers for lower costs.

Larry Levitt, executive vice president for the Kaiser Family Foundation, said to the New York Times last year: "The political appeal of the public option is it preserves the choice of private insurance. But the better it works, then the less likely it is to actually preserve a private insurance market."

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