Retirement Blog

Finance Blogs » Retirement Blog » Spinning health care tales

Spinning health care tales

By Barbara Whelehan ·
Friday, January 21, 2011
Posted: 4 pm ET

The House's repeal of the health care overhaul this week has been deemed largely symbolic since the Senate won't deal with it. While members of Congress may feel a sense of obligation toward the constituents who voted them in office, the problem is that politicians and Americans are operating under false assumptions. They believe the lies that have been disseminated by nefarious forces.

The main culprit: insurance industry giants inspired by greed that go to great lengths to conduct deception-based campaigns while presenting a completely different, cooperative facade to the public. Their methods are exposed in Wendell Potter's book, "Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans."

Potter worked as a spinmeister for the insurance industry for two decades, so he's intimately familiar with its machinations. The book is an act of contrition. It is well-documented, filled with compelling data to support his contentions. It should be required reading for every American.

About health reform, Potter writes: "Health insurers and other special interests opened their pocketbooks to frustrate reform and protect huge profit streams. Political front groups flourished, nurtured with millions of dollars from shadowy corporate sponsors, including insurers. Powerful images and words were unleashed. Anti-reform operatives concocted myths, libeled Democratic leaders, used racist slogans and pictures, and questioned the patriotism of people supporting a just health care system. Fox News eagerly broadcast these antics and messages -- morning, noon and night. And perhaps most important, the health insurance industry showered members of Congress with political contributions -- and overwhelmed them with thousands of lobbyists to push its propaganda."

No wonder people are unhappy with the final product -- the Patient Protection and Affordable Care Act, or PPACA. While it's better than nothing, it does little to curb insurance costs because profits are the No. 1 objective of publicly traded companies, health insurers included.

Just yesterday The Wall Street Journal reported that fourth-quarter profits for health insurers look solid. "Researchers at Goldman Sachs Group estimate that the top four publicly traded plans will show earnings increases averaging 21 percent in the fourth quarter of 2010 compared to the year-earlier period," writes Avery Johnson. This, despite the benefit expansions already in force, such as preventive care and no lifetime limits on policies.

Meanwhile, reports that the cost of health insurance provided by employers is expected to rise by nearly 12 percent this year in North America, according to a Towers Watson survey.

See a connection?

Hey, I'm a red-blooded capitalist like everyone else, but health and profits fit together like the North and South poles.

Insurers' need to keep stock shares rising is the reason they bamboozled Americans, politicians and the press into believing that a government option would be detrimental to us all. "Insurers worried -- and rightfully so -- that they would fail to compete against the superior provider networks, lower overhead, and lower premiums of a public option," writes Potter. "And a government-operated plan wouldn't concern itself with surging insurance company profits and obscene executive pay, focusing instead on processing claims efficiently and setting reasonable rules on what services were covered."

Employee health benefits

Detractors of PPACA say the regulations will erode employer benefit plans. But in life and death matters, when expensive treatments are called for, health insurers in these plans can deny benefits and not be held accountable. It turns out that ERISA, that massive legislation that helps protect pension benefits for workers, does not really protect employees -- or their dependents -- who may need an organ transplant, for example. Read the account of Nataline Sarkisyan in Potter's book for details.

ERISA also doesn't protect workers who have been promised health insurance benefits at retirement. An employer can just decide one year not to offer them anymore.

"There have been suits brought by retirees or retiree groups when those benefits have been changed or eliminated, but mostly those don't seem to get very far," says Nevin Adams, an attorney and editor in chief of "Your health care coverage doesn't 'vest' in the same way that, say, a pension benefit would."

Recently 3M Co. announced it would stop offering a health plan to retirees, blaming the new health reform law as a factor in its decision.

Good, affordable health care enhances financial security, and financial security is the foundation of retirement planning. Congress needs to see through the haze of lies and get to the heart of the matter.

Follow me on Twitter: BWhelehan

Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
End the Ponzi Scheme
January 26, 2011 at 8:57 pm

Ok bla bla,

Summer 1997 Thunder Bay, ON, Canada - My wife's cousin.
Fall 1996 Rowlett, TX - My wife's 14 year old chocolate toy poodle.

Sorry, not posting the cousin's name, he was a truck loader, and stepped down, missed where he wanted to step, leg bent the wrong way, and the knee was shot. If you get a look at it quickly enough, and repair the damage, you have a pretty good chance of a full recovery. Again, since it's not life threatening, he waited on a list for about 6 months, then got seen. The hospital put him in a brace, gave him crutches and told him to wait. By the time he was seen by a specialist to figure the way to correct it, the damage was essentially permanent.

Sylvia Reid
January 25, 2011 at 7:31 am

TX Pharm I have taken my son to four doctors and each doctor
is not an American one. They were from India, each one tells
my son he has a pulled muscle or pinched nerve in the groin area.
My son can barely walk he is swollen something pitiful. He is
on Medicaid and each of the doctors will barely see him to examine him because of Medicaid. What you have stated in your blog is the honest to God's truth. You can barely receive decent Medical help now. I took my son just yesterday to the
emergency room at Eastside Medical here in Snellville, Georgia.
He could not walk plus he had a stiffened neck so severe he could not move his head from one side to the other. The Doctor
x-rayed his neck came back told him his neck looked fine, he
saw nothing wrong, but yet my son cannot move his head. We
left totally disheartened because we received no help whatsoever
with his problems. We were told to go back to our local physicians. My family has always had problems with hernias.
Many members of my family have had to have operations for this
condition, in my heart I feel that my son Jimmy may have a small
hernia that is not being diagnosed correctly. Because he cannot
afford medical insurance he is examined and sent home to remain
in a painful state with no meds, no nothing. Yes we need a lot of reform because Like you have stated we will soon not have
a decent doctor to help us when we need medical attention severely. You seem like an intelligent man please give me and my son some advice as to where we could obtain some decent help.

bla bla
January 25, 2011 at 1:03 am

"Give up? 6 months vs 1 hour."

I agree that M. Moore is not a reputable source. However, it is better than no source at all or information gathered from an extremist blog.

Something like this requires a reference. I believe this claim to be patently false.

Barbara Whelehan
January 24, 2011 at 3:02 pm

The insurance industry sure did get worked up about Moore's film. Potter says its front group AHIP devised a "multipronged strategy to discredit both Moore and his movie." He devotes an entire chapter to how riled up the industry got over that movie, and said that Michael Moore got it right. Your point notwithstanding, I've heard people who said they like the Canadian health care system. And I personally know someone who lives in England who's quite happy with the public health system there as well. I know I've run across horror stories about our own health care system, and I believe these stories are the reason why the reform issue reached a crescendo in recent years.

End the Ponzi Scheme
January 24, 2011 at 1:43 pm

Let me guess you believe "an inconvenient truth" as fact as well.

A partisan hack film is no basis for judging the health care system of another country. At least consider using reputable sources rather than Hollywood to make a point, and no Michael Moore is not a reputable source.

Having first hand knowledge, want to guess the time it takes to get an MRI for a blown out knee in Canada vs. time to get an MRI for a dog with seizures in the US?

Give up? 6 months vs 1 hour.

Sure the knee isn't life threatening, so it can wait and be rationed until a slot opens up somewhere down the line. Forget the fact that the dog died less than a year later, but the man continues to live, and walks with a severe limp now, unable to perform the job he had at the time of the accident.

Barbara Whelehan
January 22, 2011 at 12:08 pm

I guess Senate Minority Leader Mitch McConnell made a "bold prediction" that there will be a vote.

January 22, 2011 at 11:05 am

The House's repeal of the health care overhaul this week has been deemed largely symbolic since the Senate won't deal with it.


Wow. Tell us how you know this.

McConnell said there WILL be a vote.

I don't think you understand all the Senate rules.

Reid saying no debate/vote does not mean there will not be one.

Barbara Whelehan
January 22, 2011 at 10:12 am

Hi TxPharm and Chris, I didn't declare this blog post to be unbiased. The health care law is an amalgamation of provisions cobbled together by special interests, representing both industry and consumer activists. As Jay MacDonald points out in his blog post, big industry will do its best to whittle away the consumer-friendly parts of the law. I don't know if a single-payer national health program is the answer, but 18,000 members of Physicians for a National Health Program apparently do. I don't buy your bleak outlook for health care under such a system, TxPharm. See Sicko and how Canada, France and even Cuba provide quality, affordable health care for their citizens. I agree with Chris that the public option should have been part of the agreement. It would have helped to keep profit-hungry insurance companies in check. I also agree that costs need to be controlled both at the individual and government levels. Thanks to both of you for contributing your points of view.

January 22, 2011 at 4:29 am

Well...doctors need to stop making deadly mistakes, such as a sponge or clamp left in the body. We shall NOT give them any immunity when they get caviler with a patient. Obama did the absolutely the right thing for America, however, law lacks teeth. Public Option should have been kept on-board and immediately repeal McCarran-Ferguson Act of 1945. TxPharm said he voted for Obama and went too far to the is the problem, he capitulated with Republicans early and weakened the resolve of the American people. Majority of the Americans are in favor of the law...with exception to the mandate portion. The repeal is a disgrace...people are going start dying and the U.S. for the 2nd time in 100 years will fall into Great Depression, if it gets repealed. For all time....Boehner will mean "Fool or Deceptive Patriotism " for eternity, along side Benedict Arnold. Oh and couple republicans voted for in favor of it...they should be commended for their courage and service to the american by passing health care reform.... truly the best day.

January 21, 2011 at 8:32 pm

Another totally biased article. I have worked in health care for 30 years and have read PPACA in its entirety. It is the worst combination of private sector/government control, and sets up an infrastructure that will force physicians into becoming government employees. Many specialists that see primarily Medicare patients are, in effct, already government employees. I seriously doubt that our government, comprised disproportionately of lawyers, will ever succumb to the notion that "All Americans have a right to legal aide" and force lawyers onto an analagous "LawCare" program that forces them to accept 25% of their usual fee.
So here's a prediction: In ten years , you will wait four months to see a nurse practitioner. If he/she somehow determines you need surgery before you end up critically ill in the ER, your surgeon will have graduated med school in Bangladesh, admitted to practice in US when licensure standards were dropped to allow 31 million more in the health care system. It is quite simple: We cannot expect a reasonably bright person to subject themselves to 10-16 years rigorous training, get 300K in student loans, work 80 hrs/wk all under the constant threat of a lawsuit, to make the same money a plumber does. Doctors are already retiring in record numbers. The quality of med school applicants will plummet. Plus Democrats frontloaded 10 yrs of taxes to pay for 6 yrs benefits, then expect the American public to believe this will reduce the deficit? Medicare will go broke in 2017 but they're going to rob it of 500billion to pay for a new entitlement program? And I should get some new credit cards when I already owe 100K. Democrats believe they can shove this down the throats of Americans without ONE Republican vote and no get an American Revolutionary anti-tyranny based pushback? Hence the election of Scott Brown to te Kennedy's seat. Hence the "shellacking" at midterms. Americans told their government in mid terms to STOP SPENDING MONEY. This comes to you from a prototypical independent voter. I voted for Obama, but he went much too far to the left. Hehas lost independents and will not ge them back. Before you comment on this bill, PLEASE READ IT, unlike our Congress before voting on it.