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Health Insurers’ “Mask of Sanity” Slips

Maya Angelou has been credited with saying “When people show you who they really are, believe them,” which is sometimes expanded to “When people show you who they really are, believe them the first time.” The idea is that doing so may be crucial to protecting your well-being and your life.

Well, the folks in the health insurance industry have shown us who they are, again. And while we’ve had several opportunities to recognize who were dealing with, we now have more reason to believe them than ever.

An abusive partner will often show you who he or she really is, long before finally resorting to the first push, shove,or punch — and sometimes that warning comes in the form of a threat like “If you even think about trying to leave me, I’ll make sure you regret it.” Angelou, and others, might say that’s a cue to start packing, because the truth is you’ll regret it even more if you stay.

The folks at AHIP, the health insurance lobby, have essentially made that threat, in the form of leaked a memo saying if the Senate Finance Committee passes the Baucus health care reform bill — which lacks a public plan — insurers will seriously increase rates.

We are writing today to share a new report by PricewaterhouseCoopers (PwC) that examines the impact of the Senate reform proposal on the cost of coverage for both single and family policies in the individual, small group, large group, and self-funded insurance markets.

The report makes clear that several major provisions in the current legislative proposal will cause health care costs to increase far faster and higher than they would under the current system. The report finds that the proposal “will increase premiums above what they would increase under the current system for both individual and family coverage in all four market segments for every year from 2010-2019.”

For example, the analysis shows that the cost of the average family policy is approximately $12,300 today and will rise to:

* $15,500 in 2013 under current law and to $17,200 if these provisions are implemented.

* $18,400 in 2016 under current law and to $21,300 if these provisions are implemented.

* $21,900 in 2019 under current law and to $25,900 if these provisions are implemented.

In fact, between 2010 and 2019 the cumulative increases in the cost of a typical family policy under this reform proposal will be approximately $20,700 more than it would be under the current system.

There’s a word for this: extortion.

1 : the act or practice of extorting especially money or other property; especially : the offense committed by an official engaging in such practice

2 : something extorted; especially : a gross overcharge

Where I come from, we have another term for it: getting jacked.

2. To steal, either covertly or by force any item.
2b. To rob at gunpoint, as one would a bank or convenience store.

3. Cheated, robbed, deprived of an amount of money or property via a complex scheme or confidence game.

Look, nobody ever thought that health care reform would come cheap. Of course it’s going to cost us, but Simon Johnson and James Kwack point out that — as with financial reform — we can’t afford not to do it. The cost is too high.

We’re going to to have to pay for it, which means the money to do so is going to have to handed over to someone. And when it comes to health care, we now know at the truth about at least of the parties at the table: the one threatening to turn it over and send us the bill. They’ve shown us who they are. Again.

The Sociopathy of “Big Insurance”

The mask slipped. Sociopaths usually have in their arsenal something known as the “mask of sanity.” Some have better, more effective masks than others. Ted Bundy is an example of one with a high effective “mask”. Dorthea Puente is another, and Dr. Harold Shipman is yet another.

When firmly in place, an effective “mask” allows the wearer to appear charming, harmless, and perfectly reasonable. It lulls their victim into a false sense of security in the notion that they’re dealing with a normal, sane person. Successful sociopaths manage to keep that mask in place, and don’t let it slip until they are sure their victim is completely at their mercy. Then they show no mercy. Only then do they show their true face. If the sociopath is truly successful, the victim is the only one to see his true face.

But some are only successful for a while. Then — due to arrogance, carelessness, desperation, or some combination thereof — they make a mistake. They reveal too much. Or they go too far, too publicly. And the mask slips.

In AHIP’s case, the revelation of the Price Waterhouse Report is a combination of all of the above. They either didn’t intend for the memo to go public, or they thoroughly misread indications of how it might be received (further indicated by Price Waterhouse sprinting backwards, to distance itself from the AHIP memo), or they thought that all escape routes were closed off. Americans were finally cornered, and it was time to take the mask off. They didn’t count on their intended victim still having some will to fight. Just like Bundy didn’t count on one victim fighting back and escaping him only to eventually testify against him, and Puente didn’t count on relatives searching for victims she thought nobody would miss.

But, truth be known, all left behind tragedies that would eventually catch up with them. For Bundy it was the skeletal remains of his victims, for Puente the sickeningly sweet smell of decaying flesh emanating from her garden, and for Dr. Shipman it was the virtual parade of his victims in the obituary pages. The insurance industry has its own, in the form of 45,000 Americans who die each year due to lack of health insurance, and the 700,000 Americans who go bankrupt every year due to medical expenses They make up 60% of personal bankruptcies in the U.S. (Total number of Canadians and Europeans who experience medical bankruptcy? Zero.)

The people who brought us these numbers, also had a hand in stories like:

  • The woman whose cardiologist paid for a stress test that her insurance company (AHIP Member, Horizon Blue Cross/Blue Sheild), that saved her life when by detecting a heart condition that wouldn’t have been detected otherwise, and might have killed her the next time she mowed her lawn.
  • Another woman, M_____ (who didn’t want columnist Nicholas Kristoff to use her name) who was advised by a social worker to divorce her husband, who was diagnosed with early-onset dementia, because the costs could be catastrophic if her husband required long term care.
  • Kathy Kerns, who has multiple sclerosis and pays $30,000 a year out-of-pocket, because her lifesaving medicines cost $5,000 a month, and her specialized physical therapy costs $600 per half-hour. When she calls her insurance company and pleads that she needs more therapy, they answer “It isn’t in the policy.”
  • The 17-year-old whose insurance company cancelled her coverage, to the tune of more than $20,000, after she was diagnosed with celiac — a condition that, once diagnosed, is relatively easy and inexpensive to manage.
  • Twelve-year-old Diamonte Driver, who died as a result of an abscessed tooth, when his family couldn’t afford an $80 tooth extraction, or find a Medicaid dentist that would take care of it.
  • Sally Marrari, whose insurance was cancelled after she was diagnosed with a thyroid disorder, fluid in the heart, and lupus — leaving her with over $25,000 in medical bills — because the company claimed she lied about “preexisting conditions” she didn’t know she had.
  • The man whose case made medical journals when he nearly killed himself with baking soda, which he used to treat severe indigestion that might have been diagnosed and treated if he’d had health insurance. Instead he ended up with severe metabolic alkalosis, and probably a huge medical bill and ongoing indigestion.
  • Walter Shelton, a 57-year-old safety consultant, who couldn’t get because insurance his and his wife’s prescription information was sold and entered into a huge prescription database that insurance companies use to weed out applicants based on their prescription history. The Shelton’s medicine — high blood pressure medicine prescribed for the minor problem of his wife’s swelling ankles, and an anti-depressant prescribed for the “off label” purpose of helping her sleep — are “red flags” to insurers.
  • Selah Schaeffer, daughter of Steve and Leslie Schaefer, who was diagnosed with a potentially fatal tumor at the age of four. Once her medical bills hit $20,000, her insurer (AHIP member, Blue Cross) stopped covering her care and eventually cancelled her coverage retroactively.
  • Donna Carter, mother of three and technical writer for a DC consulting firm, whose premiums went up so high that she found herself paying $200 more per month than before — even though her employer picked up more of the cost of coverage than before.
  • David White, a business owner in Maine, who had to lay off an employee for six months, reduce the the amount of coverage he offered and raised the cost for his employees — in a year when his company had made record profits — because those profits were consumed when his insurance companies premiums doubled. His parents, both over 70, still held jobs — just so they could have health care.
  • Mark Smith, an AmeriCorp volunteer who moved to New Orleans to help rebuilt after Katrina, was stuck with $90,000 in medical bills after he was shot in the stomach while trying to stop a car theft. His insurance company only covered one ninth of his medical bills. AmeriCorp volunteers organized a benefit to help with his medical expenses.
  • Kathleen Angotti, whose insurance company refused to pay for treatment that relieved her symptoms after other treatments failed, leaving her wracked with painful symptoms, forced to use a wheelchair much of the time, and her family forced to solicit donations to support her treatment.
  • Patsy Bates, a 52-year-old hairdresser, who was undergoing chemotherapy for breast cancer when her insurer (AHIP Member, Health Net) cancelled her coverage, leaving her with $129,000 in medical bills. A California court later fined Health Net $9 million, just one day after the Los Angeles city attorney sued Health Net claiming it illegally cancelled the policies of 1,600 patients. City attorney Ricky Delgadillo said Health Net ran an illegal incentive program in which it paid bonuses to an administrator for canceling policies. Health Net acknowledged such a program existed from 2002 to 2003, but was scrapped.
  • David Waddington, a 58-year-old wine retailer who has polycystic kidney disease, an inherited condition that causes cysts to grow on on the kidney, leading to swelling of the kidney, high blood pressure, disruption of kidney function. The disease often goes undetected until tests revealing it are performed for other reasons. Reasons like donating a kidney to a father who needs it, as the Waddington family found out when David needed a kidney transplant, but he and his wife forbade their sons to donate one of theirs, and the sons’ doctors advised against it too — because they would have to be tested for the inherited disease, and if testing revealed that either of them had it, that brother might never be able to get health insurance.

They’re the same people who brought us stories like Stacy Ritter’s.

They’re the same people behind countless other stories.


These same people, at the same time, engaged in behavior like:

These are the same people who have spent years “dumping the sick” — in the words Wendell Potter, of former head of communications for AHIP Member CIGNA — to maximize profit.

AMY GOODMAN: What do you mean, “dumping the sick”?

WENDELL POTTER: Two different ways that they do this. In the individual insurance market, we’ve seen quite a bit of news coverage, especially in California. When insurance companies who are active in the individual market-and this means when you don’t get your insurance coverage through your workplace, about the only option you have is to buy it directly from an insurance company, and usually it’s much more costly than it is through-if you buy it or get it through your employer. Once you file a claim, if you are unfortunate enough to get very sick or have an accident and file a claim, you very often will find that your insurance company will go back and look at your application to see if there might be a chance that you either didn’t disclose something that you knew about in the past or inadvertently didn’t disclose something or might not have known about a pre-existing condition. They’ll use that as evidence that you were committing fraud, and they’ll revoke your policy, or they call it “rescinding” your policy, leaving you holding the bag, making you completely responsible for all the medical bills. That’s one way that they dump people who need insurance the most.

Another is, if you are employed, particularly with a small business, and your insurance-your employer gets his or her insurance through one of the large insurers, and if just one person in your company files a claim that the underwriters think is too high, if it skews what they think is the appropriate medical experience or claim experience, when that business comes up for renewal, they very likely will jack up the rates so much that your employer has no alternative but to leave and leave you and all of your coworkers without insurance. Either that or they may cut benefits or try to shop for coverage somewhere else. But the end result is, you may find yourself dumped into the rolls and the ranks of the uninsured.

And those profits? Well, monopolies tend to do well, and the health insurance industry is no exception. Premiums have gone up 119% from 1999 to 2008, and are projected to double again by 2020. Meanwhile, profits rose 428% at the top 10 publicly traded health insurance companies, from 2000 to 2007.

That explains huge executive paydays like the $1.6 billion salary for United Health CEO William McGuire, or $9.8 million for WellPoint CEO Angela Braly.

And now insurers have taken off the mask and made it plain to see who we’re dealing with. After months of pretending to go along with reform, swearing to cease practices they’ve had 30 years to stop already, to get a bill that would require Americans to buy their product (guaranteeing them millions of new customers) without a public plan option to balance things out, insurers have finally said it: It’s simply not enough.

Baucus’ Finance Committee is scheduled to vote tomorrow on the bill, which includes:

  • An individual mandate requiring all those without coverage to buy private insurance – in other words, tens of millions of new paying customers for the private insurance companies.
  • Subsidies for moderate income people to buy insurance.
  • No meaningful price controls on what insurers can charge in premiums, co-pays, deductibles, co-insurance and other fees.
  • No meaningful reforms on insurance denials of care recommended by doctors that the insurers don’t want to pay for.

You’d think the insurance industry CEOs and lobbyists would be jumping for joy with this massive taxpayer subsidy for the already profit-soaked industry.

But you’d be wrong.

AHIP is upset that the industry companies aren’t getting enough after the Senate Finance Committee adopted amendments reducing penalties for those who fail to buy private insurance. They want the government to impose onerous fines on people who can’t afford the industry’s sky-high premiums.

So on Sunday, AHIP threw a huge temper tantrum. In a surprise move, AHIP released a report it commissioned, warning that average family premiums will go up to $21,300 if the Senate Finance Committee bill is adopted.

They’ve made it clear what they want.

In other words, the insurers want health-care reform to have a stronger mandate, which will require substantially more spending, which means we’ll need more revenue. But they oppose all the new revenue streams that help pay for the bill, and they oppose the major sources of savings that help offset the remaining cost of the bill. And they say the Finance Committee’s numbers don’t add up? That’s some chutzpah, as my grandmother would say.

And they’ve threatened that we’re going to regret it if they don’t get it.

It might have seemed a bit extreme when, earlier, I compared the insurance industry to to sociopaths. But it’s less extreme when considered in the context of all of the above, and in light of the traits of sociopathy, it’s a bit easier to see the world through their eyes.

Imagine – if you can – not having a conscience, none at all, no feelings of guilt or remorse no matter what you do, no limiting sense of concern for the well-being of strangers, friends, or even family members. Imagine no struggles with shame, not a single one in your whole life, no matter what kind of selfish, lazy, harmful, or immoral action you had taken.

And pretend that the concept of responsibility is unknown to you, except as a burden others seem to accept without question, like gullible fools.

Now add to this strange fantasy the ability to conceal from other people that your psychological makeup is radically different from theirs. Since everyone simply assumes that conscience is universal among human beings, hiding the fact that you are conscience-free is nearly effortless.

You are not held back from any of your desires by guilt or shame, and you are never confronted by others for your cold-bloodedness. The ice water in your veins is so bizarre, so completely outside of their personal experience, that they seldom even guess at your condition.

In other words, you are completely free of internal restraints, and your unhampered liberty to do just as you please, with no pangs of conscience, is conveniently invisible to the world.

You can do anything at all, and still your strange advantage over the majority of people, who are kept in line by their consciences will most likely remain undiscovered.

How will you live your life?

The reality of corporate psychopathy comes into view.

The Diagnostic Criteria

1. failure to conform to social norms with regard to lawful behavior as indicated by repeatedly performing acts that are grounds for arrest.

Comment: This is true for some psychopaths but not all. Many of them manage to live a long and parasitic life, never see a day in prison and die quietly of old age. Corrupt corporations reach positions of great power and they do this by going beyond social norms. They seek out loopholes in the law, incorporate offshore, curry favor with politicians, manipulate stock shares and engage in illegal accounting practices. In their drive for power and profit they pursue a path where when caught, those at the top still walk away with fabulous sums while the workers and the shareholders are left holding a very empty bag.

2. deceitfulness as indicated by repeated lying, use of aliases or conning others for personal profit or pleasure.

Comment : Conning others speaks to the heart of psychopathy. Lying consciously or unconsciously is the instrument by means of which a psychopath establishes a beachhead with his prey. It comes packaged in various ways – charm, wit, good looks and cunning. His individual goal is money, love or power. Corrupt corporations are out for money and power and maneuver the agencies of government in pursuit of their goals. Love is an irrelevant emotion as this plays out.

3. impulsivity or failure to plan ahead

Comment: The Iraq War is a case in point when corporate psychopathy influences the political structure.

4. irritability and aggressiveness as indicated in repeated physical fights or assaults

Comment: This is characteristic of psychopaths who pursue a career in crime. There is aggression and fighting in the world of corporate psychopathy but this is acted out in the court to save or expand one’s own turf.

5. reckless disregard for safety of self or others

Comment: Again the relevance of corporate psychopathy to the political structure has played a role in the Iraq war, a war that has resulted in the loss of thousands of lives.

6. reckless disregard for safety of self or others consistent with irresponsibility as indicated by repeated failure to sustain consistent work behavior or honor financial obligations

Comment: When the word safety is used here in a more general sense, e.g. financial security, it is relevant to corporate psychopathy. Once greed takes over honesty goes out the window. Accounting becomes cover-up. Stock maneuvering enriches the executives at the expense of the workers and shareholders. When corrupt companies fail, workers lose.

7. lack of remorse as indicated by being indifferent to or rationalizing having hurt, mistreated or stolen from another

Comment: The lack of genuine remorse is another basic feature of psychopathy. The corporation as an entity cannot feel remorse but the people who run it can, at least to some extent, in their personal lives and on rare occasions when the law catches up with them and confronts them with the tragic consequences of their actions. The fact that a corporation may have taken a psychopathic course does not mean that the individuals responsible are psychopaths, although there may be an occasional one among them. They are, however, in an emotionally compromising and awkward place. On the one hand, they have participated in the creation of a psychopathic entity that wreaks havoc on people and the environment. On the other hand, at home in their private lives they are no different than the rest of us except for their high lifestyle. The only residue of psychopathy in their personal lives is their enjoyment of ill-gotten gains. A more stark example of this is the emotional compartmentalization of the concentration camp guard who is very much the psychopath at his job and the family man at his home.

I have briefly sketched the extent to which the concept of corporate psychopathy fits into the current diagnostic criteria of anti-social personality. The diagnosis rests on meeting at least three of the criteria. I have developed the correspondence based on meeting six of the seven (1,2,3,5,6,7). The concept of corporate psychopathy fits snugly into these six.

The criteria as noted in the manual do not go far enough in capturing the essence of psychopathy, As R.D. Hare and others have pointed out, they are attuned to a certain segment of the criminal population and do not sufficiently emphasize the personality traits of the psychopath, traits which enable them to pursue a psychopathic way of life quite well within the accepted bounds of society.

It is often the case that psychopaths are gifted with a natural talent for ingratiating themselves. They walk among us wearing “the Mask of Sanity”. Impervious to genuine feeling, lacking in empathy they manage to get what they want from others and tragically on occasion manipulate an entire nation.

The sociopathy of health systems is easier to see in that light.

In health and aged care people are all too often vulnerable and unable to act in their own best interests. Because of this the health system has been based on trust. Funding is readily exploited and has also traditionally been based on trust.

Care and profit compete directly for the health care dollar and those who can bring themselves to compromise on care will be most profitable. This problem has been recognised for 2000 years. The system is very vulnerable for sociopaths to exploit. It is a set of fragile social structures which require constant identification and reinforcement, not only by the professions but by the larger society. In the past a cohesive community, strong professional associations and clear ethical systems have been moderately successful in controlling sociopathic tendencies.

…Corporatised Health and Aged Care suffer from all of the problems I have described. The frames of understanding create a set of desirable outcomes that are in direct conflict with the services desired by society. They conflict directly with understandings that already exist. People who identify totally with these new frames of understanding are given unlimited power and credibility. The corporatised market is intensely competitive and those who are unable to compete in a sociopathic manner go under.

And in that light, it becomes easier to understand why they’ve clearly said they’re not going to stop the practices mentioned above, and why they’re making threats in the face of legislation that won’t do much to stop them anyway: because all that matters is what they want, and because they can.

But here’s a question: If the insurance companies have finally come to understand that it’s wrong to kick people off their coverage when they get sick; and it’s wrong to deny coverage to people who have previously been sick; and it’s wrong to hide lifetime limits in the fine print, forcing people into bankruptcy if they face a serious illness; and it’s wrong to discriminate against pregnant women and their families; why don’t they stop doing these things? Like, how about today? Why are they waiting for Congress to outlaw their most abominable practices?

They won’t do that, of course. They’re hoping to squeeze every dollar they can out of patients in the current system, up until the last possible day they can. And things are going great for them at the moment. According to the Kaiser Family Foundation, the average premium for a family plan in 1999 was $5,791. By 2008, the average premium was $12,680. So over a decade in which inflation increased prices by 29 percent, the price of family health insurance went up 119 percent. UnitedHealth, probably the most despicable of America’s health insurers (look at any health-insurance industry scandal, and UnitedHealth is likely leading the way) just announced that in the second quarter of 2009, they made a profit of $859 million, every dollar squeezed from patient premiums and through the avoidance of what the industry calls “medical losses,” meaning when they reluctantly pay for care.

So somewhere today, a family is being told by one insurer after another that they can’t have coverage because of their pre-existing conditions. Somewhere today, a woman who was just diagnosed with cancer has been informed that her insurer is dropping her from her plan, because when she got the diagnosis, they began an investigation of her to see if they could come up with a pretext for kicking her off, and they struck gold when they discovered she forgot to tell them about a years-ago visit to a dermatologist for acne. Somewhere today, a family is filing for bankruptcy, because even though they had insurance, once one of them got sick, they quickly reached their “lifetime cap” of coverage, so the company to which they’ve dutifully paid premiums will no longer pay for their care. Somewhere today, a couple celebrating the birth of their child just got a call from a collection agency, because even though they had insurance, the fine print of their plan contained a series of riders detailing how the insurance company will essentially refuse to pay for all but a tiny portion of the costs of a pregnancy (read Sarah Wildman’s horrifying and revealing tale of how her insurance company did this to her).

So if the insurance industry really wants to demonstrate its good faith on health-care reform, here’s what it could do: End these practices now. Don’t wait to see what’s in the final bill. Do it now. Stop denying coverage for pre-existing conditions. Stop rescinding the policies of people who get sick. Let people keep their coverage when they leave a job if they keep paying the premiums. Stop discriminating against pregnant women. You want to atone for your sins? Changing these policies would be a good place to start.

Because they can, they believe its their right. There is nothing — nothing — to “atone” for. They believe if they threaten us enough, we’ll be frightened enough to give it to them, and desperate enough to hope that will satisfy them, they’ll leave us alone and it will finally be “over.”

But AHIP didn’t just let slip their “mask of sanity.” They removed it altogether.

Like the abusive partner mentioned earlier in this post, the insurance industry has said the equivalent of “If you even think about leaving, I’ll make you regret it.” They’ve shown us who they are, and like one who finally sees the true face behind the mask, that’s our cue to realize that we’ll regret it more if we stay with them, and the health care system that increasingly works only for them.

The mask is off, and we know who we’re dealing with now. We know giving them what they want isn’t going to satisfy them or relieve us. It’s time to stand up and tell them we know who they are now, and it’s really over.

Right now they run their markets and set their prices, and pass on any increased costs directly to consumers. That’s what they’re threatening to do if the legislation attempts to squeeze, even slightly, the colossal profits they plan to make off of thirty million new paying customers.

They want every penny of those profits. They demand every cent. And if the government dares raise their costs a tad higher than they expected when they first signed on to support the bill, they’ll pass those costs on to consumers in the form of higher premiums. They can carry out their threat only because they have unaccountable, untrammeled market power.

But they’ve now hoisted themselves on their own insured petard. They’ve exposed themselves. If they had to compete with a public insurance plan, they couldn’t get away with this threat. They couldn’t pass on the extra costs. They’d have to compete with a public insurance option that forced them to give consumers the best deals possible.

Now’s the time for Senate Finance Committee and the White House to say to the insurance industry: You want to play hardball? Okay. We’ll play it, too. You didn’t want a public insurance option. That was one of your conditions for supporting the bill. You wanted gigantic profits from having thirty million new paying customers and the market to yourself. We agreed because we wanted your support and were afraid of the negative ads and hurricane of opposition you could finance. But you’re even greedier than we imagined. And now you’ve demonstrated that greed to the American people. They don’t want to turn over even more of their hard-earned money to you. So, insurance companies, we’ve got news for you. We’re going to make sure Americans have the freedom to choose a public insurance option that’s cheaper and better, and you’re going to have to work hard to keep them your customers.

Now that the mask is off, the gloves should come off, and all deals should be off. We can see who we’re dealing with now. We know they were never bargaining in good faith. And we know that the price of giving them what they want — again — is far, far too high.

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