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Wendell Potter
Wendell Potter

To former colleagues in the health insurance industry, Wendell Potter is a Judas. But to activists fighting for health care reform, he's a hero.

After working nearly 20 years as a public relations honcho for two of the biggest health insurance companies in the world, Potter quit to join the other side. In June, Potter delivered a scathing insider account to Congress, describing how insurers "dump" patients with costly health problems to protect profits. He signed on as a senior fellow with Madison's Center for Media and Democracy -- an independent organization devoted to exposing propaganda -- formalizing his new role as a leading national whistleblower. This summer he has appeared on dozens of TV shows, including "Bill Moyers Journal," to unveil what he calls the industry's sleazy and hidden tactics to smear and sabotage health care reform.

Potter, who once flew around the country in private corporate jets, recently grabbed a rare break to speak with The Capital Times, while riding the commuter rail between Trenton and Newark, N.J., to yet another public appearance. Next weekend, area residents can listen to him in person at Fighting Bob Fest at the Sauk County Fairgrounds, where he'll join a lineup of other advocates for health care reform including Congresswomen Tammy Baldwin and Gwen Moore and U.S. Sens. Bernie Sanders and Tom Harkin.

Here is a preview:

CT: You were a big shot for years for the health insurance industry. Why did you suddenly decide to switch sides, right in the middle of the battle for health care reform?

Potter: My decision to leave the industry and speak out were two different things. I chose to leave my job because I was growing increasingly disillusioned about the kinds of health care policies that the industry is moving toward. The industry calls them consumer-directed plans, which is a euphemism that would make one think they might have been designed by consumers for consumers. But they are not in the best interest of most Americans. They require high deductibles and require people to make more decisions on their own and pay more expenses out of their own pockets. There are other policies that are called limited-benefit plans that don't cover nearly enough. I refer to many of these plans as fake insurance or junk insurance because people are under the misapprehension that insurance is comprehensive. But the marketing materials companies use are misleading and obscure the fact that these policies are not what consumers think they are.

CT: How has the industry changed in the past 15 years or so since there was a similar debate over the Clinton plans for health care reform?

Potter: The for-profit insurers now dominate the industry. There has been significant consolidation since the last time we had this debate. There are now fewer insurance companies and a small number of very, very large companies, many of which didn't even exist. The seven largest of these companies have total revenues of $250 billion. One out of every three people who has coverage is enrolled with them. So they are very, very dominant. Today insurance premiums are much higher, people have few choices, and the costs of care are much higher. More people are uninsured. And a real problem that will soon get much worse is that a growing number of people are underinsured - enrolled in these high-deductible or limited insurance plans that don't really protect them.

CT: How might this changed marketplace affect the battle over health care reform?

Potter: What we really have now is a cartel of large insurance companies that control not only the market but the debate on health insurance. And most people don't even know it. These companies contribute millions and millions of dollars on lobbying efforts to persuade politicians to vote against reform and on public relations campaigns that are designed to mislead and deceive people. They are much richer and much more powerful than they were in '93 and '94 and even back then they were able to kill the Clinton plan.

CT: Yet you spent years as the head of a public relations department that thought up and practiced the very same tactics you now call sleazy and dishonest.

Potter: Lately, as I've been talking to groups, I've been apologizing for the role I played in defeating reform. I'm ashamed not only of what the industry has done and become but of those of us who have done public relations for the big role we play. What I'm doing now is making amends for cheating people out of reform when the insurance industry killed the Clinton plan. It's something that I can't do over so I'm trying to make use of the insider information that I have to explain to people how the industry really works.

CT: How did the industry really work in the campaign to discredit Michael Moore and his movie "SiCKO" - which you played a part in?

Potter: The industry trade association was very worried about the movie and started the effort to discredit it and Michael Moore even before it came out. The PR strategy was to try to discredit the filmmaker by referring to him as "Hollywood filmmaker Michael Moore" as opposed to a documentary movie maker. And to demean and criticize the health systems in the movie. They used the same PR tactics that they used to defeat reform in 1993 by warning that if Americans were to embrace a system like one of the countries depicted in the movie they would be getting socialism and a government takeover of health care. The industry created a front group called Health Care America that was operated by a PR group. It was a real shell organization and it was created only to discredit the movie. These are typical tactics used by the tobacco industry.

CT: Did they work?

Potter: Yes. They were able to radicalize and marginalize Michael Moore. They were able to make people believe anything Michael Moore did was too socialistic and to the left of most Americans to be considered credible. The overall impact of the movie was diminished by this concerted effort and the millions of dollars spent to discredit it. I suspect the industry spent more money to discredit the movie than Michael Moore spent to make it.

CT: What did you think personally about the movie you tried to tear down?

Potter: It was very accurate. I had already begun to have some doubts about the industry, so I felt very uncomfortable.

CT: What finally made you take the leap?

Potter: A month after "SiCKO" came out I was visiting my parents, who live in the northeastern part of Tennessee very close to the border of Virginia. And I heard about this health care exposition being held up the road in West Virginia and it intrigued me. So I went to take a look at it out of curiosity. When I walked through the fairground gates I was just stunned. It was almost like I was hit by lightening. There were hundreds and hundreds of people waiting in line, standing in the rain, just to get care. They were treating patients in animal stalls. Other treatment areas were in tents. You could see people being treated right out there in the open, like this was a war-torn country or refugee camp or a Third World country. And I thought: is this my country?

CT: But you were a successful, bright guy. You knew there were millions of people without insurance.

Potter: My own reality was so removed from that kind of scene. I had a nice job with Cigna and a nice office in a high-rise building. I dealt in numbers. I knew that 47 million people didn't have insurance. But when you deal in numbers like I did and most executives do, you have no emotional connection. You don't stop to think: there are actually 47 million human beings we are talking about here. And my life was not even as insulated or isolated from reality as more senior executives. Like our CEO. When he gets up to go to work in morning, there's a car and driver waiting at his door to take him to the office. A company employee brings him breakfast and lunch. He doesn't even have to go to the cafeteria or leave the office to do anything or get anything.

CT: What's his salary?

Potter: His total compensation is around $12 million to $20 million a year. It varies. Many of them earn much more than that. The CEO of Aetna earns $60 million to $98 million. When you're making those kinds of dollars ... well, it's profit protection that's the motive. These companies are controlled ultimately by the investors who own them and the Wall Street analysts. These are the people who really call the shots. I've seen the share price decline 20 percent in a single day when a company disappoints its owners. That is what is driving these companies.

CT: Is it possible to have a decent health care system driven by profits?

Potter: I don't think so. But it is the reality of what we will probably have to live with. By focusing on profits you have to take measures to reduce risk. You have to figure out ways to deny coverage or exclude some people from coverage.

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CT: But this spring, health insurance executives promised to do away with pre-existing condition exclusions.

Potter: Empty rhetoric. That is the part of the PR campaign that they want you to see. The charm offensive. You'll see some executives on TV and read their quotes in newspapers. You'll hear them testify in Congress and promise (President) Obama they will work to help achieve reform. They want you to believe they're wearing white hats. But the other secret campaign is one they don't want you to see. They're working through these big PR firms that use conservative talk-shows hosts and editorial writers to be what they call third-party advocates. To be shills. To scare people by using terms like "government takeover" and "tax increases" and "socialism." It's fabrication and based on lies but that's fine with them as long as they achieve their end results.

CT: Which end results?

Potter: Cheating reform.

CT: I went to a conservative rally last week in Madison where many people used those exact same terms. So are you saying these people are stupid to believe this stuff?

Potter: People keep falling for it because there is almost no awareness of how special interests manipulate public opinion. I try to explain to people that the big, rich special interests are able to not only work through lobbyists to persuade lawmakers to do things their own way but have become almost invisible persuaders. And people unwillingly and unknowingly have become pawns and advocates and spokespeople for the industry. And they don't even know it. Because often they are getting their information not from the mainstream media but from people they think are credible and trustworthy sources. From an editorial writer or conservative talk-show host. I know that, for example, back in the Clinton campaign they were able to get information to people like Rush Limbaugh. They worked through big conservative think tanks like the American Enterprise Institute and the Heritage Foundation, all allies of the industry. So they funnel talking points and get information to these pundits. The editorial page director of the Wall Street Journal is on their speed dial right now. I bet if you were to ask many of these people where did they get their information they would tell you places like Fox News.

CT: But if reform fails is it really as simple as because the industry is powerful and evil and blocks meaningful change? How about the roles being played - or not - by the media and pro-reform activists?

Potter: Very good questions. The media has not done an adequate job of showing what is really going on. Part of the reason is we've seen a decline in the resources of the mainstream media. Reporters are stressed. There's not much news space or interest on the part of editors to health care in an adequate way. There is very little investigative journalism. Even the best papers are not doing a very good job in covering all the reasons we're having this debate. They're just resorting to the fairly easy task of reporting the contest on Capitol Hill.

CT: How about advocates for reform?

Potter: The advocates have not done a very good job of representing the benefits of reform, in presenting what a public option would be and how it would benefit people. I don't think that the advocates anticipated adequately and planned adequately for the opposition that was inevitable, and that just baffles me. Because the enemies of health care reform have used these same tactics time and time again. Frankly what we're seeing is that health care advocates were overconfident. I kept hearing that the stars were aligning and that now that we had Obama in the White House and Democrats in the majority, well, what could go wrong? Well, I'll be blunt. Yes, the president gave wonderful speeches but he has failed to communicate the real reasons we need this reform. Maybe that will change next week when he speaks to Congress. Maybe then he will refute the lies and call them out. But he needs to really connect to people emotionally to make sure they understand what we need to do and why.

CT: So what's going to happen in the next few weeks?

Potter: I predict Congress will pass something. The president and Congress have so much invested they will claim victory and do their best to persuade the public that it is a big step forward. But I do worry that some of the most important components of the legislation might not survive. I am not throwing in the towel. Some people have already written the obituary for the public insurance option. I'm hopeful. But it will take a lot more leadership. And it's vitally important that people in Wisconsin get in touch with their members of Congress. It's not enough to have voted for a president or to have large majorities. There are billions at stake and the industry is fighting this big-time. These could be the most important weeks in our country's history. People need to see it in that way and do more than they are currently doing to communicate their hopes and their beliefs.