I sat at a table last week with representatives of Public Enemy No. 1 — the health-care insurance industry — and a more disreputable pack of scoundrels I have rarely observed. Fortunately, I had been warned about their crafty ways by President Obama, House Speaker Nancy Pelosi and Nobel laureate Paul Krugman, so I was fully prepared when they made an effort to humanize themselves.
Naturally, I refused to be fooled by their synthetic outrage over being demonized in the health-care debate. Didn’t Pelosi explain to us that insurance companies “are the villains in this”? What possible reason would such an esteemed leader have to incite the public with unfair accusations?
I asked the four top executives at our editorial board meeting — from UnitedHealthcare, Cigna, Anthem Blue Cross and Blue Shield, and Rocky Mountain Health Plans — about the president’s claim that we need a government insurance plan (the “public option”) to “keep the insurance companies honest.”
“Do we need a ‘public option’ in grocery stores to keep them honest?” retorted Cigna president Daryl Edmonds — perhaps unaware that his tart response could give this administration and Congress ideas. Undeterred, I pressed on: Aren’t your administrative costs out of line compared to Medicare’s because of outrageous salaries and other cockamamie expenses? That’s what I keep hearing from advocates of a public option, and they never play loose with the facts.
The executives argued that it’s almost impossible to track Medicare’s true administrative costs because of the way they’re spread across the government — and that in any event, 87 cents of every private health-insurance dollar go to pay physicians, hospitals and pharmaceutical companies. But I smelled a rat. After all, the remaining 13 cents include profits, and everyone knows that insurance industry profits are obscene.
Never mind that Anthem president John Martie handed me a graphic with PriceWaterhouseCoopers data showing that health plans’ net profit margin is lower than in many other sectors. He would make a big deal about that, wouldn’t he? I’m sure a 3 percent profit must be immoral for some reason. Where’s Madam Speaker when you need her to explain why?
Meanwhile, these executives had the everlasting gall to scoff at the president’s claim that they’d be competing on a level playing field with the public option. How would that work in the real world, they wondered. If the public option followed Medicare’s example, after all, it would simply dictate reimbursement at below-market rates.
By the end of the meeting, the insurance honchos were really punching below the belt — pointing out, for example, that Medicare was not exactly a font of innovation in terms of disease management, preventive programs, cost containment and modernization, while their companies actually were pioneers in such areas.
Sarcasm aside, I carry no brief for insurance companies. I’m sure they’d be delighted with a bill mandating universal coverage and guaranteed issue, so long as a public option were deep-sixed. And yet those reforms alone would do nothing to slow the growth of health-care costs and premiums, which are on an unsustainable course.
I’m just saying they have good reason to fear a public option, which ought to be stopped in the name of consumer choice; that they are no more the villains in health care than other players; and that it is simply inconceivable that the industry is as indifferent to overhead as the breathless fans of a public option contend.
E-mail Vincent Carroll at vcarroll@denverpost.com.
