Insurance firms seeking to sow doubt about single-payer in Vermont

By Wendell Potter for

You can’t see them. They’re hidden from view and probably always will be. But the health insurance industry’s big guns are in place and pointed directly at the citizens of Vermont.

Health insurers were not able to stop the state’s drive last year toward a single-payer health care system, which insurers have spent millions to scare Americans into believing would be the worst thing ever. Despite the ceaseless spin, Vermont lawmakers last May demonstrated they could not be bought nor intimidated when they became the first in the nation to pass a bill that will probably establish a single-payer beachhead in the U.S.

When he signed Act 48 into law on May 27, surrounded by dozens of state residents who worked for many years to achieve universal coverage, Governor Peter Shumlin expressed great pride in what had been accomplished.

“We gather here today to launch the first single payer system in America, to do in Vermont what has taken too long—to have a health care (system) that is the best in the world, that treats health care as a right and not a privilege, where health care follows the individual, not the employer,” Shumlin said.

The problem for Shumlin and his allies is this: it will take five years before Vermont can fully implement its new system, partly because the federal health care reform law prohibits states from undertaking more far-reaching reforms until 2017 unless granted waivers from the feds to do so. And though Vermont’s Congressional delegation is on board to pursue a waiver that would let the state set up a single payer system two years from now, the insurance industry’s friends in Washington are not keen to let that happen. That’s because they want to use those five years to persuade Vermonters that they really don’t want to go the single payer route after all.

During my 20 years as a health insurance PR executive, I was involved in numerous efforts to make the very term “single payer” toxic to most Americans. We even spent hundreds of thousands of premium dollars in 2007 to help finance the operation of a front group, called Health Care America, for the sole purpose of trashing a movie — Michael Moore’s “Sicko” — that put single payer systems abroad in a favorable light. You can rest assured that the industry will spend much, much more to make sure that Vermont does not succeed.

I have observed in Vermont over the past several days just how the invisible hand of the insurance industry is working. Insurers know their efforts will be more effective if they can get others — third party advocates, they call them — to carry out them out. I recognized the campaign because the tactics are the same as those used in previous attempts to kill reforms insurers don’t like.

Part of the strategy is to get key groups of individuals to begin raising doubts, to get Vermonters to second-guess themselves. Among the first groups the insurers have targeted are those most easily spooked — certain business owners and physicians, especially specialists who thrive in the current system.

Last Wednesday, legislators got a sampling of what they’re in for. At a hearing on creation of the state’s health care exchange, or marketplace — mandated by the federal reform law — employers worried about losing the ability to choose from numerous competing insurers. And they worried too about not being able to shift their employees into benefit plans with high deductibles. Insurers and employers have been collaborating for the past several years in a mutually beneficial effort to shift more of us into high-deductible policies. The higher the deductible, the less insurers and employers have to pay for our care. This collaboration has been so successful that increasing numbers of American families filing for bankruptcy are, at least theoretically, insured.

At a hearing a few days earlier in Rutland, this one for health care providers, several physicians were, wittingly or not, using some of the same industry talking points I used to write for insurers’ allies.

Dermatologist Dan McCauliffe was one of several doctors there who suggested that patients needed to pay more — not less — out of their own pocket for care. Ironically, this skin doctor joined other physician specialists in arguing that health care costs would never stabilize until patients had “more skin in the game,” a term my former colleagues used frequently as we tried to spin the “advantages” of high-deductible plans. According to statistics from the American Medical Association, dermatologists are among the highest paid specialists, making on average more than $230,000.

So why do insurers care so much about Vermont? Even though Vermont is a small state where most for-profit insurers have little business, the insurers don’t want a single state to go single payer. Just last week, single payer advocates in California fell just a few votes short of getting a bill to the floor of the Senate for a vote. If Vermont succeeds, California lawmakers might actually get the votes they need.

Health insurers make enormous amounts of money off of us, something they cannot do so effectively in other countries, especially Canada. The four largest insurers, United, WellPoint, Aetna and CIGNA, reported earning a combined $11 billion on nearly $220 billion in revenues last year. For years insurers have been successful in persuading Americans to believe something that is at best debatable — that they play a useful role in the U.S. health care system. They are nervous that if Vermont proves to the rest of the country that health insurers are about as useful as teats on a boar, they might have to figure out another way to make a few billion bucks.


  1. Vashti Winterburg on February 8, 2012 at 5:39 pm

    Thank you, Mr. Potter. Keep up your vigilance, we all need it. I came off a non-profit board last year where a family policy cost $1300 a month plus an $8000 deductible plus co-pays. Needless to say, we prayed, PRAYED that no one else wanted to on the policy. To spend over $23,000 before your health insurance policy kicks in means the insurance company is laughing all the way to the bank.
    I hope someone asked that dermatologist how many people worked in his office, how many were insured and what those insurance costs were and how much he paid vs. his employees’ share.
    I also can recommend “The Healthcare Movie” a documentary by Laurie Simons and Terry Sterrenberg on the Canadian system

  2. Tom Bayus on February 9, 2012 at 2:46 pm

    After being diagnosed with prostate cancer I saw my insurance premium got from $550 a month to $1889 a month…A friend of mine had a stent put in his heart after a blockage was found.. His premium went for $645 a month to $2360 a month.. That’s for single person coverage,not family.. It’s ridiculous and a national disgrace that this is allowed to happen in what’s supposed to be the greatest country in the world..Only the stupid and gullible believe our system in sbetter than Canada’s… It’s not!!!!!!!!!!!!

  3. Sally on February 9, 2012 at 3:19 pm

    I lived for 22 years in Canada and had a baby under their system. It works and it works really well. You never worry that if you lose your job, you lose your health insurance. They see healthcare as a right that should be accessible to all, not a product that should be sold. And their prescription drugs cost much less because there is one purchaser.

    • Bill on February 9, 2012 at 3:45 pm

      I am from Canada and lived in USA 30 years. There is no debate about the single payer system. Americans have to stop believing lobbyists and tv commercials. Take out the Insurance companies and put the money in State systems.

  4. Larry Shipley on February 9, 2012 at 4:34 pm

    i can not understand the reluctance of any US Citizen to embrace a single payer health insurance program. I live in Florida and I would not want it to be run by the State. They would find a way to privatize it and would work diligently to assure it falied. This MUST be a Federal program. Additionally, smaller states would not thave the buying power to effectively negotiate pricing from the Drug Companies.

  5. Jo Joshua Godfrey on February 9, 2012 at 6:38 pm

    Not only do they make money off us, we cannot get the healthcare we paid for. They commit crimes and walk away scott free. That really needs to change.

    • Denise on February 10, 2012 at 9:42 pm

      We do not get what we pay for, is right. I am having a difficult time getting my insurance company to cover a mammogram I had because apparently the doctor’s office did not bill it as a preventative service. So, I am on the hook for an error in billing which I have absolutely NO control over. I’ve explained this to the insurance company and they’ve told me that I must be very diligent in informing the billing department of any healthcare service I seek that my plan only covers “preventive services” and that it must be billed that way or else they won’t pay for it. Un-freaking-believable that I now have to spend my time sorting this all out. You’d think with the millions they make off the American public, they could cough up the $300 they say they won’t cover. Especially when you’re paid up in full on your premiums… The system we have here is sick to the core and is not about providing the services that people actually need, it’s about profit and it’s as simple as that.

  6. Pam Pourreyron on February 9, 2012 at 10:15 pm

    My husband was diagnosed with Liposarcoma a few weeks ago. His private insurance company has been denying all his medical visits even though he has gone way over his deductible. They have denied appeals and stated that his cancer is a pre-existing condition. We put in a claim at the The Health Insurance Board in our state and have finally received an overdue answer from his insurance company formally rejecting our denial backed by 2 peer reviewers they chose. The insurance board is now outside of its jurisdiction and suggests we get a lawyer. We are fortunate to belong to the French single payer system and my husband will therefore be operated on over there. We can not return to the States to live anymore because he will be a walking pre-existing condition for all future policies. God bless this country and the 80,000 people who die every year from lack of insurance, or those who will remain in debt for the rest of their lives because they have fallen ill as if it was of their choosing. Pre-existing, deductible, pre-certification not guaranteeing coverage, pre-determination and the list goes on and the insured get denied. Yes, these insurers are committing punishable crimes and so are the ones, employees or the hired outsiders; lawyers and medical mercenaries, they pay to perpetuate these crimes on their battlefields. I do hope they all can sleep well at night. Signing a denial stating that cancer is a pre-existing condition is condemning someone to die.

  7. margaret on February 9, 2012 at 11:12 pm

    Mr. Potter,
    Anything I can do to help? I work in the medical field.
    You write so beautifully. I will try to share your writing on FB as a start. Are you on FaceBook?

  8. Dolores Williams on February 10, 2012 at 2:31 am

    HR676, Expanded Medicare for All, by Representative John Conyers, Jr.,supported by Representative Dennis Kucinich and some Representatives who have signed on again this year. Ask your Representative to sign on. We can have Medicare for All if we all get our Representatives to sign on. We all know relatives on Medicare, and know friends who count the days until they qualify for Medicare and then are free of going bankrupt because of health bills.

    Republicans are trying to privatize Medicare, Medicaid, Social Security and the Post Office. Those in Congress who are asking 31% pay cut to doctors who serve medicare are trying to kill medicare, as is the insurance company offering Medicare-Advantage, a private company billing 110% of medical bills to Medicare–costing $1100/MA subscriber from Medicare fund.

    If we wait until all states try to get their own single-payer, it will take years while people go bankrupt. OccupyWS is for single-payer and for the 99%. We need to join groups and demand decent health care for everyone.

    Physicians for a National Health Plan, HR676, were refused a place at the table during the recent health care bill. The insurance companies could not compete with single-payer so they blocked them for consideration. Until money is not allowed to bribe our representatives, insurance company lobby stranglehold on our representatives’ campaign money needs are more powerful than serving “We the People.”

  9. John Barker on February 10, 2012 at 2:31 pm

    The Tea Party and Republicans in general would not be obstructing every piece of legislation of benefit to the American public if they knew the American voter would not back them up. The people in Congress did not just appear there. Americans elected them and they got what they voted for. After the last election, I kind of gave up. Not even Medicare and Healthcare-Now could perform the necessary brain transplants the American public requires. Convincing evidence is everywhere that the current for profit system is not working and that single payer systems like Medicare or the Canadian system work well, yet Americans packed the Congress with people who promised to work against single payer and the average American’s best interests in general.

    It will be a long, long haul but Healthcare-Now is an organizatiion dedicated to the monumental task of educating the American Public with respect to the obvious merits of single payer Medicare for all. After some re-couperation from my disbelief and dispair, I have sent in my renewal for membership in Healthcare-Now.

  10. Hal Goldfarb on February 10, 2012 at 10:57 pm

    And Vermont will implement Single Payer universally by avoiding ERISA’s health care provisions exactly how?

    Why is ERISA not mentioned even once in this article? I am a staunch supporter for SP, but someone needs to look into this roadblock now.

  11. Victoria on February 11, 2012 at 4:41 am

    In Washington state – why is no one talking at all about the massive profits the insurance companies are making? All we hear about are the budget cuts made necessary by lack of funds, the cuts to social services, schools, police depts, and no one can afford medication or medical care after they get sick. . . but there is silence on what the insurance companies are raking in. A billboard would be nice . . .

  12. Danny Dyche on March 14, 2012 at 11:53 pm

    Health-insurance companies don’t earn money, they extort it. The civilized way of running a healthcare system is like fire and police departments: each person with a problem of the relevant kind has the appropriate action taken at no personal cost and the government provides budget payments.