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Why Junk Insurance deserves an Occupy Movement


Things are heating up in Chicago and I don't know a soul who is surprised by that.  It's Chicago and it's Emanuel Land.  Last week the Occupy Wall Street Windy City branch decided to occupy Grant Park past the posted 11 PM closing time.  The police, never ones to miss even vague radical clues, guessed correctly that these folks had other things on their minds and weren't going to be ready to leave just because a simple sign said they should.

When the clock moved past the magic hour, Mayor Rahm barked, the police moved in, and more than a hundred people were arrested in the eviction process. (Contrast that to the Good Mayor of Lansing, my hero and would-be governor, Virg Bernero, who welcomed the OWS protesters to the state capital, encouraged the crowd to keep up the good work, and provided park permits and the services necessary to make the days easier for them. Ahem and aha.)

So the climate in Chicago is apparently not good for protesters, (though I have to say it's much better than that in Oakland) but I'm hoping those same OWS crowds got wind of this week's Junk Insurance Conference, and hot-footed it over there.  (It began yesterday and runs through Friday.)

My hero, Wendell Potter, former CIGNA CEO turned whistleblower, wrote about it in HuffPo:

On Wednesday [10/26/11], the third annual Voluntary Benefits and Limited Medical Conference will open at the Marriott Renaissance Schaumburg Convention Center, not far from Chicago's O'Hare airport. In just three years, this conference has grown to be a very big, three-day extravaganza. According to the conference Web site, it will "bring together all the players in the industry, from employers and benefits managers, to insurance agents, consultants, brokers, insurance companies, TPAs (third-party administrators), and enrollment firms."

All you have to do is spend a few minutes on the Web site to get an understanding of just how much money there is to be made selling inadequate coverage to naive consumers. You'll see all the big names in the insurance world among the attendees and exhibitors, including the very biggest -- Aetna, Blue Cross and Blue Shield, CIGNA, Humana and United -- as well as dozens of restaurant and fast food chains and other employers of low-wage workers.

 Yes, it's a den of thieves (no surprise -- they're "insurance" biggies), but this is pretty stunning:

One of the big for-profit insurers sponsoring this year's conference markets a limited-benefit plan only to employers with inordinately high employee turnover. Not only are the benefits very limited, the underwriting criteria almost guarantee an impressive profit margin.

Under the plan, the average age of an employer's workers cannot be higher than 40, and no more than 65 percent of employees can be female. (Insurers have long charged women more than men simply because of their internal plumbing.) To meet the insurer's additional demands, employers must have a 70 percent or higher annual employee-turnover rate (that's not a typo), which means that most employees won't even stay on the job long enough to use their benefits. Employees also get no coverage for care related to any preexisting conditions they might need during their first six months of enrollment in the plan. And get this: Employees have to pay the entire premium. The insurer doesn't even allow employers to subsidize their workers' coverage. No wonder the big box retailers and restaurant chains love this junk. They list them among the employee benefits they supposedly offer but don't have to part with a dime when a worker enrolls in one of the plans.

We have come to accept the business of "insurance", not as "assurance", as it was originally defined and administered by quasi-benevolent non-profits, but as just one more scam in the long list of scams we Americans have to watch out for.  This is our health we're talking about and we've put it in the hands of merciless privateers.
 

CIGNA HQ

The insurance companies, begun as non-profits and mainly run that way until the 1970s and 80s, at least pretended to understand the part about shared risks.  Sometimes they win, sometimes they lose.  Sometimes people die long before they've outspent their premiums, while other people cause their insurance carriers to dig deep, like it or not.  That's the crux of the insurance biz.  One thing the carriers understand to the core:  they'll never go broke selling us insurance policies.  They'll always pull in more money than they'll put out.  If that weren't so, there wouldn't be an insurance industry.
 
But now we're at the point where the watchdogs are fed too well, where members of our own government fight hard against an equitable, non-profit health care solution, where the industry is so bloated, enough will  never be enough.  Even the big guys are not above committing fraud, but what makes the whole scam even more egregious is that they never needed to go to such lengths in order to make their fortunes.  The fortunes were theirs to be made.  The entire system works to their advantage, even when they're being good guys doing the right thing.

I haven't heard that there are any protesters over at the Marriott convention Center yet, but it's not too late.  As I said, the Conference runs through tomorrow (Friday).  But if the OWS folks happen to miss the Conference, they can always camp out in front of a few grand and glorious corporate offices.
 

Blue Cross-Blue Shield, Houston, TX

 
(Note that the only corporate office list I could find complete with addresses and phone numbers comes from India.  Yes, India.  I said India)

 

(Cross-posted at Ramona's Voices)

This always takes me back to a really fine movie:

The Rainmaker

I fought insurance companies for twenty five years.

Now the courts have made it harder and harder to sue them.

Access to internal memos per corporate privilege comes into play.

Access to the courts per class actions comes into play.

Access to increasingly higher fees for expert witnesses come into play.

People have no idea what is covered whether one is talking about health insurance or car insurance or property insurance or life insurance...

States like Minnesota just wrote the policies. Minnesota and other states just assumed the insurance companies would sneak in all sorts of language.

Repubs of course wish to get rid of STATE REGULATIONS; although they claim they only wish to get rid of Fed Regulations.

And sure enough, the repubs get into power in a number of states and they want to deregulate; which means the insurers get to modify form contracts to their benefit.

Is the private citizen supposed to find a thousand dollar retainer in order to translate the terms of the form contract?

And can that attorney negotiate anything with the insurer?

If you are a large corp you will of course negotiate with the insurer. Form k's are out the window when you deal with large insurance k's.

 

You bring up a most important issue.

 

I forgot to add another variable.

If a corporation is negotiating freely with an insurer for health or disability insurance that relates to its workers and there is no union rep involved in that process; guess who is screwed?

So if you are in a Right to Work State, and you are an employee:

YOU ARE SCREWED

And if you simply work in a corp without union representation:

YOU ARE SCREWED

Seems like a pretty reasonable argument for union representation. 

And yet...

Interesting take, as always, DD.  So in other words we're all screwed.  If the system was against us before, it's really against us now. 

I'm glad Wendell Potter is on our side.  As a former cohort, he'll be one step ahead of them.  Not that it'll change anything, but at least we'll get the insider skinny while they're busy screwing us. 

So reassuring that it can all be explained.  Hmmmph.

(I did like "The Rainmaker".  Matt Damon was a revelation.  Didn't know he had such chops.)

 

Wouldn't it be great if we could trade basic insurance premiums for taxes?  As you note, nobody is protesting insurance companies even though they are 

 

I'm hoping the insurance companies are next.  Surely there's enough energy for both.  They really couldn't be more deserving.

"When the clock moved past the magic hour, Mayor Rahm barked, the police moved in, and more than a hundred people were arrested in the eviction process. "

Rahm did that? In contrast to what Oaklands' mayor seems to be doing, which initially seems to be "It's not my fault; I didn't know it was going to happen; and I told the police to be gentle!"; Rahm actually set the police on the movement in Chicago?

It appears he did:

"We were providing basic first aid care in Grant Park Saturday night," said Jan Rodolfo, registered nurse and national coordinator of National Nurses United. "Rahm took the tents denying protesters first responders free speech and free assembly."

"First amendment rights don't stop at 11 p.m.," Rodolfo said.

But Mayor Rahm Emanuel said during a press conference he wanted to make sure the law was enforced.

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