Deadly Spin

by Wendell Potter

  I had been a secret admirer of John Stauber and the Center for Media and Democracy, the organization John founded in 1995 to expose spin and propaganda, even while I was spinning for the insurance industry. Thank you, John, for being a flack’s worst nightmare and for welcoming me to the CMD team as you were preparing to retire and hand the reins of the organization to the incomparable Lisa Graves. Thank you, Lisa, for the opportunity to work with you and learn from you and for the truly remarkable support you have given me. And thank you Nikolina Lazic, Page Metcalf, Sari Williams, and Mary Bottari at CMD. I have never been a part of a team I have enjoyed more. I mean that sincerely.

  Two other people I am especially grateful to are Sen. Jay Rockefeller of West Virginia, who afforded me the opportunity to testify before his Senate Commerce, Science, and Transportation Committee in what was to become my first of many public appearances as an industry critic and reform advocate, and to Bill Moyers, whose July 2009 interview with me on his Bill Moyers Journal on PBS made it possible for me to reach a national audience with my story.

  Finally, thank you Stan Brock of Remote Area Medical and thank you, thank you, Nataline Sarkisyan. The world is a much better place because of you.

  Notes

  INTRODUCTION

  1. Taking the Risk out of Democracy: Propaganda in the U.S. and Australia, Alex Carey, University of New South Wales Press, 1995.

  2. Karen Ignagni, president of America’s Health Insurance Plans (AHIP), White House, March 5, 2009.

  3. “Health Insurance and Mortality in U.S. Adults,” Andrew P. Wilper et al., American Journal of Public Health, December 2009, 99: 2289–95.

  4. The Hidden Persuaders, Vance Packard, David McKay Company, 1957, 32.

  5. The Invisible Persuaders, David Michie, Bantam Press, 1998.

  CHAPTER III: PERCEPTION IS REALITY

  1. Cutlip & Center’s Effective Public Relations, Glen M. Broom, Prentiss Hall, 2009, 3.

  2. Public Relations Society of America, http://www.prsa.org/AboutPRSA/PublicRelationsDefined.

  3. Toxic Sludge Is Good for You, John Stauber and Sheldon Rampton, Common Courage Press, 1995, 17.

  4. The Unseen Power: Public Relations—A History, Scott M. Cutlip, Lawrence Erlbaum Associates, 1994, 52–53, 97.

  5. The Father of Spin, Larry Tye, Henry Holt and Company, 1998, ix.

  6. Ibid., 23–31.

  7. Toxic Sludge, Stauber and Rampton, 292–94.

  8. Public Relations Society of America, http://www.prsa.org/AboutPRSA.

  9. Franco did not admit to or deny the charges but did enter into an agreement with the SEC not to violate the agency’s regulations in the future.

  10. “Wal-Mart Stores Inc.: Publicist Enlists Bloggers to Combat Negative News,” Wall Street Journal, March 7, 2006.

  11. “Wal-Mart vs. the Blogosphere,” Pallavi Gogoi, BusinessWeek.com, Oct. 18, 2006, accessed at http://www.msnbc.msn.com/id/15319926.

  12. “Book of Tens: Agencies of the Decade,” Advertising Age, Dec. 14, 2009, accessed at http://www.edelman.com/news/2010/Ad_Age_AgencyAList.pdf.

  13. Toxic Sludge, Stauber and Rampton, 6–8.

  14. Propaganda, Edward Bernays, Ig Publishing, 2005, 37.

  15. The Biography of an Idea: Memoirs of Public Relations Counsel Edward L. Bernays, Simon and Schuster, 1965, 652.

  16. Mein Kampf, Adolf Hitler, vol. 2, A Reckoning, chap. 6, “War Propaganda,” accessed at http://www.hitler.org/writings/Mein_Kampf/mkv1ch06.html.

  17. The Later Years: Public Relations Insights 1956–1986, Edward L. Bernays, Howard Pen Hudson Associates, 1986, 115.

  18. Later Years, Bernays, 139.

  19. Effective Public Relations, Broom, 25.

  CHAPTER IV: REMOTE AREA MEDICAL IN

  WISE COUNTY, VIRGINIA

  1. How to Lie with Statistics, Darrell Huff, W. W. Norton & Company, 1952, 100–121.

  2. “Changes in Health Insurance Coverage, 2007–2008: Early Impact of the Recession,” Kaiser Commission on Medicaid and the Uninsured, October 2009.

  3. “Average Family Health Insurance Policy: $13,375, Up 5%,” USA Today, Sept. 16, 2009.

  4. “Employers, Workers, and the Future of Employment-Based Health Benefits,” Employee Benefits Research Institute, February 2010.

  5. “More Small Firms Drop Health Care,” Wall Street Journal, May 26, 2009.

  6. “Behind Aetna’s Turnaround: Small Steps to Pare Cost of Care,” Wall Street Journal, Aug. 13, 2004.

  CHAPTER V: HEALTH CARE HISTORY,

  REFORM, AND FAILURE

  1. http://www.youtube.com/watch?v=fRdLpem-AAs.

  2. PBS Newshour, March 30, 2007.

  3. The Social Transformation of American Medicine, Paul Starr, Basic Books, 1982, 237.

  4. Ibid., 243.

  5. One Nation Uninsured: Why the U.S. Has No National Health Insurance, Jill Quadagno, Oxford University Press, 2005, 17.

  6. Ibid., 19.

  7. Social Transformation, Starr, 253.

  8. The Blue Shield plans, which initially only provided coverage for medical care provided by physicians, developed separately from Blue Cross plans, which in their early years only covered hospital care. The first Blue Shield plan was organized in California in 1939.

  9. Social Transformation, Starr, 261–66.

  10. One Nation Uninsured, Quadagno, 23.

  11. Critical: What We Can Do About the Health-Care Crisis, Senator Tom Daschle, Thomas Dunne Books, 2008, 49.

  12. Social Transformation, Starr, 277.

  13. Critical, Daschle, 51.

  14. Ibid., 52.

  15. Social Transformation, Starr, 285.

  16. Critical, Daschle, 53.

  17. Ibid.

  18. Ibid., 59.

  19. Ibid., 63.

  20. Social Transformation, Starr, 381.

  21. One Nation Uninsured, Quadagno, 116.

  CHAPTER VI: CONSUMER-DRIVEN CARE

  1. “How Many Are Underinsured? Trends Among U.S. Adults, 2003 and 2007,” Cathy Schoen et al., Health Affairs, June 2008. Respondents to the Commonwealth Fund survey were identified as underinsured if they spent 10 percent or more of their income (or 5 percent if they were low-income) on out-of-pocket medical expenses, or if they had deductibles that equaled 5 percent or more of their income.

  2. “Health Care Access Problems Surge Among Insured Americans,” Doug Trapp American Medical News, July 21, 2008.

  3. “CIGNA Ex-CEO Hanway’s Retirement Payments Near $111 Million,” Wall Street Journal, March 19, 2010.

  4. The Great Risk Shift, Jacob S. Hacker, Oxford University Press, 2006, 37.

  5. “CIGNA Choice Fund (SM) Study Provides New Insights on Consumer Decision-Making in Consumer-Driven Health Plans,” http://newsroom.cigna .com/article_display.cfm?article_id=669.

  6. “Healthier, Wealthier and Wiser? An Overview of Consumer-Driven Health Care,” Roberta W. Goodman, UnitedHealth Group, 2005.

  7. PricewaterhouseCoopers news release, July 18, 2005.

  8. “Workers May Be in for Health Plan Sticker Shock,” USA Today, Oct. 21, 2005.

  CHAPTER VII: IT’S ALL ABOUT THE MONEY

  1. “What Happened to Health Care Reform?” Paul Starr, American Prospect, Winter 1995, 20–31.

  2. “The Demise of the Clinton Plan,” Theda Skocpol, Health Affairs, Spring 1995, 66–85.

  3. “National Health Expenditure Data,” Center for Medicare and Medicaid Services, accessed at http://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf.

  4. “Lost Cause,” Peter H. Stone, National Journal, September 1994.

  5. “Killing Health Care Reform,” Thomas Scarlett, Politics, October/November 1994, 34.

  6. “Shaping Public Opinion: If You Don’t Do It, Somebody Else Will,” Blair Childs, seminar, Chicago, Dec. 9, 1994.

  7. Toxic Sludge Is Good for You, John Stauber and Sheldon Rampton, Common Courage Press, 1995, 96.

  8. My Life, William Jefferson Clinton, Alfred A. Knopf, 2004, 62.

  9. “Dem
ise,” Skocpol, 66–85.

  10. Ibid.

  11. “What the For-Profit Trend in Health Care Really Means,” Paul Wynn, Managed Care, June 1996, accessed at http://www.managedcaremag.com/archives/9606/MC9606.profit.shtml.

  12. “Nonprofit Health Insurers: The Financial Story Wall Street Doesn’t Tell,” Susan R. Barrish, Alliance for Advancing Nonprofit HealthCare,” accessed at http://www.healthleadersmedia.com/pdf/white_papers/wp_alliance_011904.pdf.

  13. “Kathleen Sebelius,” WhoRunsGov.com, http://www.whorunsgov.com/profiles/kathleen_sebelius.

  14. “CareFirst Sale Rejected by Md. Insurance Commissioner,” Jo Becker, Washington Post, March 6, 2003, accessed at http://www.carefirstwatch.com/news/news.cfm?ID=41.

  15. “CEO Total Compensation for Selected Blue Cross-Blue Shields, U.S. Medicare Program, 2007,” Health Care for America Now.

  16. Testimony of David Balto, senior fellow, Center for American Progress Action Fund, before the U.S. House of Representatives, Judiciary Committee, Subcommittee on Courts and Competition Policy, on H.R. 3596, Health Insurance Industry Antitrust Enforcement Act of 2009, accessed at http://judiciary.house.gov/hearings/pdf/Balto091008.pdf.

  17. “AMA Study Shows Competition Disappearing in the Health Insurance Industry,” American Medical Association, Feb. 23, 2010, accessed at http://www.ama-assn.org/ama/pub/news/news/health-insurance-competition.shtml.

  18. “Premiums Soaring in Consolidated Health Insurance Market: Lack of Competition Hurts Rural States, Small Businesses,” Health Care for America Now, May 2009, accessed at http://hcfan.3cdn.net/1b741c44183247e6ac_20m6i6nzc.pdf.

  19. “A Handshake That Made Healthcare History,” Globe Spotlight Team, Boston Globe, December 28, 2008, accessed at http://www.boston.com/news/health/articles/2008/12/28/a_handshake_that_made_healthcare_history.

  20. “Premiums Soaring,” Health Care for America Now.

  21. “UnitedHealth CEO McGuire Gives Back $620 Million,” Peter Lattman, Wall Street Journal, Dec. 7, 2007, accessed at http://blogs.wsj.com/law/2007/12/07/unitedhealth-ceo-mcguires-gives-back-620-million.

  22. Securities and Exchange Commission filings.

  23. “The Explosion of Executive Pay and the Erosion of American Prosperity,” William Lazonick, University of Massachusetts Lowell and Université Montesquieu-Bordeaux IV, Feb. 24, 2010.

  24. “Medical Benefit Ratios of Private Insurers, Public Medicare Plan, 1993 to 2007,” Health Care for America Now, October 2010, accessed at http://hcfan.3cdn.net/15b2e716998ad2bdd0_ktm6bz8u0.pdf.

  25. “Health Insurers Falsely Claim Rising Costs Justify Soaring Premiums,” Health Care for America Now, March 2010, accessed at http://hcfan.3cdn.net/578b1f7456962bfa7a_r6m6bhcjn.pdf.

  26. Ibid.

  27. Securities and Exchange Commission filings.

  28. “Report to the Congress: Medicare Payment Policy,” Medicare Payment Advisory Commission, March 2009, accessed at http://www.medpac.gov/documents/Mar09_EntireReport.pdf.

  29. “A Scrappy Insurer Wrestles with Reform,” Reed Abelson, New York Times, May 16, 2010.

  CHAPTER IX: ERISA STYMIES THE SARKISYANS, AND US

  1. “ERISA: Barrier to Health Care Consumers’ Rights,” National Association of Insurance Commissioners, 2000.

  2. Making a Killing: HMOs and the Threat to Your Health, Jamie Court and Francis Smith, Common Courage Press, 1999, 122.

  3. “Employee Health Plan Protections Under ERISA,” Karl Polzer, Health Affairs, September/October 1997, 93–102.

  4. For more information about Nataline’s Legacy Fashion Show, contact Hilda Sarkisyan at hildasarkisyan@realtor.com.

  CHAPTER X: A VICTORY, OF SORTS

  1. “Obamarama,” Chicago Reader, March 17, 2000, accessed at http://www1.chicagoreader.com/obama/000317.

  2. “Did Obama Campaign on Public Option?” Mark Murray and Domenico Montanaro, MSNBC, Dec. 23, 2009, accessed at http://firstread.msnbc.msn.com/archive/2009/12/23/2159620.aspx. Also see “Did Obama Campaign on the Public Option? Yes but Not Entirely,” Sam Stein, Huffington Post, Dec. 22, 2009, http://www.huffingtonpost.com/2009/12/22/did-obama-campaign -on-the_n_401204.html.

  3. “Obama Proposes $634 Billion Fund for Health Care,” Ceci Connolly, Washington Post, Feb. 26, 2009, accessed at http://www.washingtonpost.com/wp-dyn/content/article/2009/02/25/AR2009022502587.html.

  4. “Karen Ignagni,” WhoRunsGov.com, http://www.whorunsgov.com/Profiles/Karen_Ignagni.

  5. “Fat Paydays for Key Players on Both Sides of Health Care Debate,” Justin Elliott, Talking Points Memo, March 18, 2010, http://tpmmuckraker.talkingpointsmemo.com/2010/03/health_care_lobby_players_fat_pay_days.php.

  6. “Unlikely Lobbyist Will Lead H.M.O.’s into Battle,” Robert Pear, New York Times, July 12, 1999, accessed at http://www.nytimes.com/1999/07/12/us/unlikely-lobbyist-will-lead-hmo-s-into-battle.html?sec=health&spon=&pagewanted=all.

  7. “Insurance and HMO Industries Spend Nearly $700,000 per Day to Kill Health Care Reform Measures,” Public Campaign Action Fund, Sept. 15, 2009, accessed at http://www.campaignmoney.org/HMO_insurance_spend_to_kill_reform.

  8. “The Case for Public Plan Choice in National Health Reform: Key to Cost Control and Quality Coverage,” Jacob S. Hacker, Ph.D., Institute for America’s Future, Dec. 16, 2008, accessed at http://institute.ourfuture.org/files/Jacob_Hacker_Public_Plan_Choice.pdf?#.

  9. “Poll: Most Back Public Health Care Option,” CBS News, June 20, 2009, accessed at http://www.cbsnews.com/stories/2009/06/19/opinion/polls/main5098517.shtml.

  10. “National Health Expenditures Historicals for 1960–2007,” table 13, Centers for Medicare and Medicaid Services, U.S. Department of Health and Human Services, accessed at http://www.cms.hhs.gov/NationalHealthExpendData/downloads/tables.pdf.

  11. “Insurer-Owned Consulting Firm Often Cited in Health Debate,” David Hilzenrath, Washington Post, July 23, 2009, Accessed at http://www.washingtonpost.com/wp-dyn/content/article/2009/07/22/AR2009072203696.html.

  12. “The Health Insurers Have Already Won,” Chad Terhune and Keith Epstein, BusinessWeek, Aug. 6, 2009, accessed at http://www.businessweek.com/magazine/content/09_33/b4143034820260.htm.

  13. “Health Care: It’s Time for a Major Overhaul,” Alexander Zaitchik, AlterNet, Dec. 1, 2008, http://www.alternet.org/story/109230.

  14. “Top Insurance Lobbyist: Dem ‘Vilification’ Could Kill Reform,” Alan Fram, Associated Press, Aug. 10, 2009, accessed at http://www.huffingtonpost.com/2009/08/10/karen-ignagni-ahip-presid_n_255615.html.

  15. “Reality Check: AHIP’s ‘Study’ Hard to Take Seriously,” White House Blog, Oct. 12, 2009, http://www.whitehouse.gov/blog/Reality-Check-AHIPs-Study-Hard-to-Take-Seriously.

  16. “PricewaterhouseCoopers Backs Away from AHIP,” Ezra Klein, Washington Post, Oct. 13, 2009, accessed at http://voices.washingtonpost.com/ezra-klein/2009/10/pricewaterhousecoopers_backs_a.html.

  17. “Prognosis Improves for Public Insurance,” Shailagh Murray and Lori Montgomery, Washington Post, Oct. 24, 2009, accessed at http://www.washingtonpost.com/wp-dyn/content/article/2009/10/23/AR2009102304081.html?sid=ST2009102400183.

  18. “Anthem Blue Cross Dramatically Raising Rates for Californians with Individual Health Policies,” Duke Helfand, Los Angeles Times, Feb. 4, 2010, accessed at http://articles.latimes.com/2010/feb/04/business/la-fi-insure-anthem5-2010feb05.

  CHAPTER XI: THE PLAYBOOK

  1. “Tobacco Additives: Cigarette Engineering & Nicotine Addiction,” Clive Bates, Martin Jarvis, and Gregory Connolly, Action on Smoking and Health, July 14, 1999.

  2. Document 2075733345/3346, Philip Morris Collection (hereafter “PM”), 2000, Legacy Tobacco Documents Library (hereafter “LTDL”), http://legacy .library.ucsf.edu.

  3. “Enzi: Peace Treaty with Philip Morris No Way to Win War on Tobacco,” TradingMarkets.com, May 21, 2009, http://www.tradingmarkets.com/.site/news/Stock%20News/2340845.

  4. Document 2501358202/8212, PM, 1994, LTDL, http://legacy.library.ucsf.edu.

  5. Document 505
467389/7392, R. J. Reynolds Collection (hereafter “RJR”), 1986, LTDL, http://legacy.library.ucsf.edu.

  6. Document 2047871256/1259, LTDL, http://legacy.library.ucsf.edu.

  7. Document 507746564/6567, RJR, 1991, LTDL, http://legacy.library.ucsf.edu.

  8. Document 2023959567/9579, LTDL, http://legacy.library.ucsf.edu.

  9. “Pro-Tobacco Writer Admits He Should Have Declared an Interest,” Zosia Kmietowicz and Annabel Ferriman, British Medical Journal, February 2002; also Document 208578334/3335, LTDL, 2002, http://legacy.library.ucsf.edu/tid/rce20c00.

  10. “A Snort of Derision,” Roger Scruton, Times (United Kingdom), October 19, 1998; also Document 2064822424-2426, LTDL, http://legacy.library.ucsf.edu.

  11. Document 2504092395/2405, LTDL, http://legacy.library.ucsf.edu.

  12. Document 2025492898/2905, PM, 1994, LTDL, http://legacy.library.ucsf.edu.

  13. Document 2024233677/3682, LTDL, http://legacy.library.ucsf.edu.

  14. “How BP Secretly Buys PR,” Rick Outzen, Daily Beast, May 19, 2010, http://www.thedailybeast.com/blogs-and-stories/2010-05-19/how-bp-secretly-buys-pr/.

  15. “Slick Operator: How British Oil Giant BP Used All the Political Muscle Money Can Buy to Fend Off Regulators and Influence Investigations into Corporate Neglect,” Michael Isikoff and Michael Hirsh, Newsweek, May 7, 2010.

  16. “BP: Coloring Public Opinion,” Gregory Solman, Adweek, Jan. 14, 2008.

  17. “Oil Industry Front Group Runs Climate Change Disinfo Ads,” David Gutierrez, NaturalNews.com, Sept. 7, 2009, www.naturalnews.com/026985_oil_industry_climate_change_natural_health.html.

  18. “The 700 Club,” Jake Whitney, Guernica, April 26, 2010, www.guernicamag.com/interviews/1687/700_club/.

  19. “Lobbyists Lining Up Against Nutter’s Soda Tax,” Jeff Shields, Philadelphia Inquirer, March 11, 2010.

  20. “Soda Tax Gone; Nutter Eyes Jobs,” Catherine Lucey, Philadelphia Daily News, May 21, 2010.

  21. “D.C. Soda Tax Proposal Draws Opposition from Beverage Industry,” Tim Craig, Washington Post, May 14, 2010.

  22. “Rent-A-Front: New Group Wages Stealth Battle Against Wall Street Reform,” Justin Elliott, Talking Points Memo, April 21, 2010, www.tpmmuckraker.talkingpointsmemo.com/2010/04/rent-a-front_stop_too_big_to_fail_fights_reform.php.