Like many others, I've heard President Obama talk about his mother's insurance problems during her final months in 1995. The memory of his mother having to devote precious time and energy pleading with her insurer to pay her mounting medical bills fueled Obama's determination to focus on passing health care reform.
But I didn't realize until reading a new book about the president's mother that the insurer she was pleading with was CIGNA, the one I used to work for. I wish I had known at the time. In my role as PR man for the company, I might have been able to help.
One of the reasons I stayed in the insurance industry so long -- nearly 20 years -- was because occasionally I was able to help people who had been denied coverage.
One of my responsibilities was to advise company executives of the potential public relations consequences of certain decisions, such as refusing to pay for doctor-ordered care if a policyholder had sought help from the media or from an elected official.
I know from experience that when a reporter or politician contacts an insurance company on behalf of a policyholder, firm executives will elevate the case to "high profile" status and handle it differently. To keep a story out of the media, or to stay in a politician's good graces, insurance company bureaucrats will often do an about face and agree to pay for coverage they previously had denied.
Although I grew doubtful over the years that insurance companies really "added value" to our health care system, I often patted myself on the back for playing a role in getting a denial reversed. I slept better at night if I could tell myself that I might have helped save someone's life that morning, even though millions of other people were being forced into the ranks of the uninsured because of the industry's underwriting practices.
During the time that Obama's mother was battling both cancer and her insurance company, I was battling a managed care backlash. Soon after the Clinton reform plan failed in 1994, insurance companies offered up managed care as a "private sector solution" to the country's health care crisis. Government involvement would be unnecessary, we argued, because the invisible hand of the market and the techniques of managed care would simultaneously bring down both costs and the number of people without coverage.
Employers bought it. By the end of the decade, they had moved almost all of their workers into HMOs or similar types of managed care plans.
But for many people, managed care turned out to be more of a nightmare than a solution. One of the ways insurance companies controlled costs was by refusing to pay for care for a variety of reasons. HMO patients were out of luck, for example, if they received care, even unknowingly, from a doctor or hospital outside of their HMO's network. Many women were especially disadvantaged. Citing actuarial data as justification, their HMOs refused to pay for more than a 24-hour stay in the hospital after a woman delivered a baby or had a mastectomy.
Insurance companies also became especially vigilant in searching for evidence that a policyholder's medical treatment might be related to a "preexisting condition," as the president's mother, Ann Dunham, found out.
In August 1995, according to Janny Scott's book, A Singular Woman, Dunham received a letter from the CIGNA subsidiary that had been hired by her employer to provide short-term disability benefits. Dunham assumed the company would reimburse her for expenses related to her treatment for uterine cancer.
The letter from CIGNA dashed her hopes. The company was refusing to pay because it had reason to believe the cancer had started before she enrolled in the policy. Scott wrote that the company based its decision on notes it obtained from a gynecologist Dunham had seen months earlier for abdominal pain.
Even though the doctor did not tell Dunham she might have cancer, she made a note in Dunham's medical record that the pain she was experiencing might be the result of a malignancy.
Scott wrote that while undergoing chemotherapy and dealing with the accompanying hair loss and sickness, Dunham had to devote enormous amounts of time communicating with CIGNA in an effort to get the company to reconsider.
Making no headway on her own, she finally informed the company she was turning her case over to "my son and attorney, Barack Obama."
Obama was indeed a lawyer by then, but his name would have meant little to CIGNA in 1995. He was still serving as a civil rights attorney and lecturer at the University of Chicago law school. He simply was not important enough to really help his mother.
If Obama had been elected to the Senate before his mother got sick, her story might have had a different ending. A call from Senator Obama undoubtedly would have elevated her case immediately to high profile status. I had joined CIGNA two years earlier, so I probably would have been brought in to assess the situation and offer counsel from a public relations perspective.
Insurance company executives insist that their coverage decisions are not influenced by the threat of bad publicity, that they are made solely on the basis of medical necessity (as determined by them) and the limitations of a particular policy (also as determined by them).
Don't believe it for a minute. Denials are reversed as a matter of routine after a PR guy -- someone like me -- informs the CEO of a call from a reporter or politician.
Indeed, Obama's mother might have had one less thing to worry about during her final weeks if she had been able to get the media interested in her case. Or if she had just waited until her son was a little more influential to get sick.
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When I took an economic history course at Iowa State University many years ago, it was an eye-opening (and exhilarating) experience. The health care insurance debate reminded me of the discussion in class we had over the "rationalization" of the railroad industry in the late 1800-early 1900 when the "robber barons" like J.P. Morgan (specifically) and others brought "order" to the chaos of the railroad development back then. In doing so, they raked in huge profits at the expense of the consumer. Eventually, everything more-or-less regained equilibrium but my professor made a statement about the situation which has stuck with me ever since: he thought the railroads should have been treated like a "public utility" instead of letting the private sector handle the mess. Eventually, I think that's where we're going to have to end up, even with the Health Affordability Act. It will be that way because, to reiterate, health care isn't a "normal" consumer good and will not respond to normal market forces for that reason. The sooner everybody--and I mean everybody--realizes that, the better off the country will be.
Does anyone really believe that the government beancounter is going to be better than the one working for the insurance company? Maybe for the relative of the politician, but not for most people.
Where did you get your information?
In the real world they are useless parasites, in the wall street world they are solid investments. Sad, very sad.
Without these companies there would not be any affordable health care.
The reason things have become out of reality cost wise is because of government mandated benefits, consumer fraud and litigation. I can appreciate your opinion but you don't have any knowledge of the facts.
I know of small companies who will not file workers comp claims because of rate increases....those of us with insurance fear using it...gone on too long...single payer NOW
Of course, I was too sick to comprehend much of what was going on, much less protest their shenanigans. The business of selling bogus insurance to people, then finding spurious cause to break their conracts is so lucrative, that I have to believe these insurance companies bank on the fact that most of these folk will be too sick to protest.
They depend on most people giving up quickly.
You apparently didn't read what I wrote, or you'd have understood that my insurance company did not live up their agreement. This had nothing whatsoever to do with any choices I did or did not make, except to buy insurance from a company that used a slippery ruse to deny me the benefits I'd paid for.
That right there is why we need a single payer system. Though I think Obamacare makes it illegal for insurers to deny coverage base on pre-existing conditions, it doesn't prevent them from charging you more then you can afford. If we had a single payer system we would all be covered from the time of our birth and we would pay less for it in taxes then we currently pay for insurance.
I don’t care that it would "drive insurers out of business" overall it would be a boon to our economy since employers wouldn't have to pay for expensive medical coverage and people would have more disposable income to spend on other things.
Medicare administration costs are so much higher you would choke if you knew.
Drive administrative service out of business for Government Administration??
Are you kidding?
Medical services in 3rd world countries is cheep. Put your next surgery "out for bids"