Sep 30, 2019
With the word "whistleblower" spinning through news cycle after news cycle these last few days, every headline about Trump, Giuliani and Ukraine is a powerful reminder that the whistleblower is a proud tradition in the United States, one that merits our support and protection.
Throughout our history, women and men with courage, indignation and integrity have stepped forward to whistleblow and put an end to wrongdoing even if they themselves have heretofore been part of the problem. One of these is healthcare reform advocate Wendell Potter.
Eleven years ago, after a moment of reckoning at a country health clinic in Tennessee, Potter left a high-ranking job as head of corporate communications at Cigna to tell the truth about the excesses and abuses of the health insurance industry. Since then, he has worked hard to spread the word, authoring two best-selling books, Nation on the Take (with Nick Penniman) and Deadly Spin, and founding the nonprofit investigative journalism site Tarbell.org, named after muckraking Progressive Era reporter Ida Tarbell.
Now, among all his other efforts, activist Wendell Potter has become president of Business for Medicare for All, the only national business organization working for single payer health insurance. This group of the economically pragmatic lends expertise and credibility to the cause of reform at a time when many, including some of those running for the Democratic presidential nomination, question the viability of single payer.
I have known Wendell Potter for a decade. We broke the news of his whistleblowing at Bill Moyers Journal in 2009 when he came to us both with his story and the corporate documents to back it up. My conversation with him below has been edited for length and clarity.
Let's begin with your background for people who aren't familiar with how you became committed to healthcare reform and specifically to the idea of Medicare for All.
I spent 20 years inside the insurance industry. It was a career I never could have anticipated. I was a journalist in my first career out of school, I grew up in Tennessee, and was a reporter in Memphis and finally, Washington. I covered Congress and the White House for the Scripps Howard newspapers.
Then I got into PR work, wound up working for Humana, and then Cigna, two of the biggest health insurance companies, altogether for about 20 years.
I rose up the ranks and was heading corporate communications at Cigna when I had a crisis of conscience. I came to realize that what I was doing for a living was, in too many cases, the exact opposite of what I tried to do as a reporter. I realized I was misleading people. I told myself the story that I never intentionally lied to people, but I was misleading people to perpetuate the private insurance industry, and was a willing cheerleader for the industry for a long time.
I came to realize that what I was doing not only was so far afield from what I used to do as a reporter, but also that I played a role in perpetuating a very broken and dysfunctional and unfair healthcare system. On a trip back to Tennessee to see family, I went to something called a healthcare expedition that was being held at a county fairgrounds nearby. I went there out of curiosity.
I've often said that it was my road-to-Damascus experience. I saw people who were waiting in long lines to get care in barns and animal stalls. It [broke] my heart. It made me realize that I had some responsibility for that, and I made a commitment that day to try to figure out some other way to earn a living.
There were other reasons. I was beginning to grow disenchanted with what I was expected to say and be a cheerleader for. In particular, this was at the beginning or at the early stages of insurance companies moving everyone to the high deductible plans and I began to question that policy. I knew from experience that working from the inside trying to change something that was an industry-wide strategy was just not something that I would have any ability to influence.
So I left. I became a critic of the industry and ultimately decided to be a very public critic of the industry and testified before Congress. As you well know, one of my first times in the media was an interview with Bill Moyers.
I remember meeting in secret with you and Bill and one of our producers.
It was in secret and you guys grilled me for, I don't know how long, but you obviously wanted to make sure that I knew what I was talking about and was the real deal and would be someone worthy of TV journalism.
Medical costs are out of control. You've said the current system is not sustainable and not repairable. So what do we do?
I think the only alternative is to expand a program that's worked for more than 50 years now -- Medicare. All surveys show that people who are enrolled in Medicare, even today, despite some of the inadequacies of the current program, are much more satisfied with Medicare than people enrolled in private plans.
One reason for that is because private insurance has changed significantly over the years. Not only have premiums gone up, but insurance companies also have figured out ways to avoid paying for care in many different ways.
There's a term in the industry that you don't hear very often outside of boardrooms or calls with financial analysts called "benefit buydown." And it's a term that describes a lot of the things that insurance companies are able to do to decrease the value of your private coverage, whether it's moving people into high deductible plans, making them pay a lot more for care out of their own pockets before their coverage kicks in, limiting their choice of access to doctors and hospitals, having someone at an insurance company decide whether or not you're eligible for a procedure your doctor says you need. All these things have been going on for several years and they make health insurance much less valuable than it used to be.
Another aspect of private insurance companies that's become prevalent is to very much restrict which doctors and hospitals you can go to through these so-called limited or skinny networks. That continues. So people in private plans have less choice, but they're paying more for it and having to jump through hoops to get their bills paid.
That has not happened in the Medicare program. Medicare is a program that cares for, or provides access to care for the oldest and in fact the sickest in our population. They've done it well, and the administrative costs of that program have been far, far less than in the private insurance industry. So it makes a lot of sense to take what we've got, which has worked for people for generations now, expand it to cover everybody and eliminate an unnecessary middleman, which is the insurance industry.
One of the things that I can remember so vividly toward the end of my career was attending a leadership meeting with our then CEO at Cigna, and someone asked him what kept him up at night. He used a word that you don't use everyday -- disintermediation. It's a word that means essentially disrupting or getting rid of the middleman, the unnecessary middleman. He went on to say that he feared that at some point Americans, and in particular American employers, would begin to question "the value proposition," to use business jargon, of the private insurance industry.
We've reached that point. As you noted, my nonprofit organization is called Business for Medicare for All. We make the economic, the business case for moving to a Medicare For All type of healthcare system, and employers are indeed waking up to realize that over decades they've been sold a bill of goods by private insurers. They keep coming up with ways to shift more of the cost of care to employees and their dependents. So it's time to move to a program that makes a lot of sense economically as well as morally.
How did you become involved in Business for Medicare for All? What was the idea behind it? How did it happen?
About three years ago, I was approached by a business leader in the Lehigh Valley of Pennsylvania, Richard Master, who decided to make a documentary on the US healthcare system. He wanted to interview me. It became very clear that he was an advocate for expanding the Medicare program. He's a very successful businessman. His company is called MCS Industries and it's based in eastern Pennsylvania. They're the country's biggest seller of picture frames and mirrors and decorative stuff like that.
But he began to pay a lot of attention to healthcare costs. He's got an MBA from Wharton and a law degree from Columbia so this guy's really smart, has built a very successful business, but he was questioning the sanity of a system in which he has no control over his healthcare costs from year to year.
I realized that his situation wasn't unique. Every year, he was spending more and more to provide coverage to his workers. He was committed to that, but he was having an increasingly challenging time making the numbers work. So he did a lot of research and came to the conclusion that we're alone in the developed world in having a system that is run by insurance companies.
So he essentially woke me up to the problems that American businesses are facing. I knew what individuals and families were facing, but I hadn't paid a lot of attention to what is happening to employers who are trying to stay in the game in our uniquely American, employer-based healthcare system. It's abundantly clear that the system has run its course and is just not working for increasingly large numbers of employers. Certainly small businesses, most small businesses in this country, if they ever offered coverage, have thrown in the towel because they simply can't afford to do it.
His company is a midsize business, but he and a lot of other CEOs of midsize businesses and large companies are beginning to question the value proposition that insurance companies have always sold them on. Even some of the huge employers in this country are recognizing that. Boeing, in markets where it has a lot of workers, is bypassing that middleman and contracting directly with hospitals and doctors in markets like Seattle, Charleston, South Carolina, and southern California.
So I've learned a lot about the plight that American businesses are facing. Even Warren Buffett said a few years ago that the US healthcare system is the tapeworm that is destroying American competitiveness. American companies are becoming increasingly uncompetitive in the global marketplace, and he's right. His partner Charlie Munger, who's a Republican, has said that the only alternative he can see that makes sense is moving to a single-payer, Medicare for All type of healthcare system. So business leaders are beginning to step up and let their voices be known, and that's why we exist -- to give them a voice collectively.
We've got several hundred employers who are part of our organization. Our goal is to have at least one business from every congressional district by this time next year. We're growing pretty rapidly and we already have a voice in Washington.
You're saying, who knows better the impact of healthcare on people trying to run a business.
That's exactly right. The insurance industry, one of its current campaigns is called Coverage At Work and it's trying to perpetuate the notion that our employer-based system works and needs to be sustained.
But it's unraveling. In 1999, I think this was from the Kaiser Family Foundation survey, 69% of employers were offering coverage. It is now down into the 50s. We have this belief that most employers offer coverage, but very few small businesses now do, and that's where most jobs are generated. A lot of people still work for large companies, but the biggest job engine, if you will, or job creators, as the Republicans often say, are small businesses and they just cannot offer benefits like we used to see.
We also have the situation now with the growing gig economy and the fact that people may have as many as a dozen different jobs in a dozen different workplaces over the course of a career. Medicare for All offers portability, whereas if you have to keep switching from place to place to place, they may or may not have an employer health plan. It really messes you up.
That's exactly right and more of us are in that boat. People who are drivers for Uber and Lyft, for example, sometimes they will have a regular job that offers benefits, but more often than not, they work two or three other jobs, none of which offer benefits and so they drive to supplement their income. These companies don't offer health insurance benefits. Lyft and Uber don't because they don't consider the [drivers] employees. So we have a sizable and growing population of people who are in the gig economy and that's going to continue.
Some of the businesses that are most interested in our work are companies like that. One of our members is Postmates, the delivery service. They get this -- I mean, they know that the people who drive for them need health insurance and health benefits and having a Medicare for All type of system covers everybody and employers are unburdened with the responsibility of directly providing that coverage. It doesn't mean that they're off the hook for providing financing for this. When we are talking about Medicare for All, we're talking about a publicly financed health care system that individuals and businesses would pay to support.
And it's not creeping "socialized medicine."
It's not at all. In fact, that is a term, as you well know, that's often used by opponents of any kind of reform. To be honest with you, I used to use that term a lot at my old job to try to get people to believe that any kind of reform that we didn't agree with was socialized medicine.
As you probably know, that term really began to be used and take hold during the Cold War era, in the latter part of the Truman administration, when he was advocating for universal health care. The American Medical Association was dead set against it and began to rail against socialized medicine.
What we are advocating is not a system like the UK system in England and Scotland and some other places in which the government actually owns most of the hospitals and employs most of the doctors. You might be able to get away with calling that socialized medicine to a certain extent, but what we're advocating is publicly financed, privately delivered healthcare, more like the Canadian model. We're not suggesting that we just import the Canadian system, but it would have a lot of similarities to that...
So why is it that so many people, including some of our candidates for president, are still pushing the public option, the idea of choice, of still being able to get your private insurance or the government option?
When Congress was debating what became the Affordable Care Act or Obamacare, I was one of the most vocal proponents of the public option.
The reason was because at that time, that was as good as we could possibly get because President Obama and congressional Democrats had decided to try to keep the current system in place, make some significant changes to expand coverage in certain ways but to a large extent, keep the private insurance system controlling the healthcare system, serving as the gatekeeper. So President Obama said, "Let's have a public option," as he put it, "to keep private insurance companies honest."
This just shows you how much things have changed. Ten years ago, there really was no serious consideration in Congress for Medicare for All or single-payer healthcare. At that time, it was just considered something that Congress would never consider. Flash forward 10 years, and you have a majority of Democrats in the House signed on to legislation that would create a Medicare For All type of healthcare system.
But a lot of the presidential candidates are not there yet. The ones who are: Bernie Sanders is the chief sponsor of the Medicare for All bill in the Senate and Elizabeth Warren and Kamala Harris, Cory Booker, and I think Julian Castro are co-sponsors.
But Kamala Harris then kind of backed away from Medicare for All.
She did, she's had two or three different positions on it, or at least clarifications, I guess she's called it, or explanations. I don't know what she said most recently, but essentially she is saying, let's keep private insurers in the mix, that it might be too disruptive to suggest that people might lose their private insurance. She was not there initially, but in her more recent statements, she has kind of changed to say that.
I think the reason is because there are people who have been led to believe that people are so attached to private health insurance that they would oppose a policy change or a law that would ultimately make private insurance unnecessary, and then people would "lose" their private insurance.
If you look closely when you're polling Americans, they're concerned about losing something they had that's valuable, but what they're most concerned about is having coverage that they can afford and that is secure, that's not going to go away when you lose or change jobs. And the choice they're most interested in is having a broader choice of doctors and hospitals. Most of the top line survey results you see [indicate] those people are concerned about losing private health insurance, but if you drill down, they may be happy to move away from that system as long as you can assure them that they will have access to the doctors and hospitals that they want and that it's going to be secure, they won't lose it, and that it's affordable.
Elizabeth Warren said in Houston at the last debate, everybody loves their doctor. Everybody loves their nurses. Everybody loves their therapists. I don't know anybody who says they love their insurance company.
And she was right! Back in my old days in the industry, I can recall when we did what we could to try to see if we could change public attitudes toward insurance companies. I'll be honest with you, for quite a period of time, I wouldn't tell people what I did for a living because private insurance companies have never had a good reputation. The reality is that it's the system we grew up with, and a lot of people have been led to believe that government is bad, and the government can't do anything efficiently, and ignore the fact that the Medicare program has been operating very efficiently, serving the oldest in our country for many years.
And it was really up and running in a year. They had it running efficiently very quickly.
That's exactly a point that I make as well. People say, "Gosh, you're talking about something that would be so disruptive and how can you pull that off in a short period of time?" [Medicare] was up and running in a year back in the 60s.
One of the reasons why there were problems associated with implementing [the Affordable Care Act] was because it was built around the existing multi-payer system. It's enormously complex. To roll out a system that's built on that and to try to set up a mechanism in which people are still faced with multiple choices and you're having to set up some kind of an exchange, as was done to make sure that you had a program that had all these multiple insurers and their multiple plans, it's enormously complex, but a transition to Medicare would be much, much simpler.
I'm in a labor union. Medicare is my primary coverage and my secondary is my union plan. It's a very good plan. What do you say to someone like me, a union member, about giving that up in exchange for Medicare for All?
You have to be assured that what you would be giving up would be replaced with something that would be at least as valuable and that it would not be disruptive. A lot of union members have expressed concern because these healthcare benefits in many cases have been hard fought.
One of the things I would tell you is that you might have good health care coverage or at least better than some people in this country have. You may have benefits that are richer, to use a term that's often used, but there's no security that you will keep that job. If you are a union member in those places, you can still lose your job, still experience a plant closure and then you can lose your coverage.
In my case, I'm vested in my union plan.
So you have to be persuaded that you will have benefits that are even better or no worse than what you currently have, and we can make that assurance. Even in most union plans these days, the participants are increasingly facing higher deductibles. They're having to pay more out of their own pockets before their coverage kicks in. They're not immune to that. Increasingly, the networks of providers are more and more limited.
This year, you might have the doctor that you prefer to use, next year you might not. It's out of your hands and you probably didn't have a choice of insurance carrier. That was made for you. So this notion that even people who have union plans have a choice of health insurers, it's not true, because those decisions were made by somebody else and typically, you're never asked.
I think those who have union jobs in many cases have better benefits than those who don't have union representation. Still, employers are faced with a conundrum. Private health insurers cannot and do not, nor do they want to control healthcare costs. So those costs continue to go up, and because we have the system we have and private insurers are really the only game in town, they're able to demand more of employers every year in terms of premiums and higher costs to provide coverage to workers.
Then there are these other things that are now common in private plans, like having a denial nurse or a medical director who is really in place in these insurance companies to determine whether you will get the care that your doctor says you need. Union members are not exempt from that. That's something that most people don't really fully appreciate until they really become very ill or injured and are finding that they and their doctors don't have the final say as to whether they'll get coverage for a treatment that even is listed as a covered benefit.
You've heard me tell this story, but the thing that was the final straw for me was having to defend my old company and be the spokesman for the company when a 17-year-old girl in California was scheduled to have a liver transplant, but a company medical director said that he didn't think it was medically appropriate for this patient. She was 17 years old and a perfect match had been found. The family knew and the doctors knew that this was a covered benefit, transplants were covered, but that doesn't mean you're going to get it. For high ticket items like that, there's always a health insurance employee who will make the final decision as to whether or not you're going to get coverage.
I was always advised by the lawyers at my company, "You never say that we deny care, but we can deny coverage for care." There's no difference between that because most people, if you deny them coverage, most people don't have the funds and can't scare up the money to pay for your child's liver transplant.
In this case, the family raised such a ruckus and got such media attention focused on this case that my company capitulated and ultimately decided to cover the transplant but days passed, and when you're facing a situation like that, minutes count. Like I said, there was a perfect match of a liver found. It was waiting for the surgery to start when the family was called aside and the surgeon said, "I'm sorry, we can't go forward because Cigna hasn't given us clearance." So that's what more and more people are facing. That's not an isolated story, it happens day in and day out.
You recently said to Michael Hiltzik at theLos Angeles Times, a Pulitzer Prize winning columnist there, "Health insurers have been successful at two things, making money and getting the American people to believe they're essential."
It's true. I handled financial communications for Cigna for 10 years. Whenever the company would announce earnings or have any kind of financial news release, I was the guy that reporters from The Wall Street Journal and New York Times and anyone else would call to find out what it all meant. So I had to know how insurance companies, and my company in particular, made money, where the money came from, where the money went. So I learned that is absolutely true. They know how to make money, regardless of what laws and regulations are in place.
And I knew quite frankly, that when the Affordable Care Act was passed, even though there were important provisions in that law that restricted some of the practices that they were engaging in that were very common before the law was passed, that they would figure out other ways to make money because they have shareholders who have expectations of a certain amount of profit every three months. It's a short-term game. You have to demonstrate to your shareholders and Wall Street financial analysts that you are mindful of their needs... So that's job number one for them is to make sure that they're making money that satisfies Wall Street and their shareholders.
The other thing that I was in involved in and engaged in for years was ongoing propaganda campaigns to make people think that [private insurers] are essential. It's not just the insurance industry, but other corporations over many years have persuaded the public that the private sector can do no wrong, and that the free market is sacred and can work in healthcare as well as presumably in any other sector of the economy.
We have decades of evidence that it doesn't, but if you have the resources to engage in an ongoing propaganda campaign, you can persuade people, and you can turn people against policy proposals that would be in their best interest. I know that from having done it for many years.
How does a group like Business for Medicare for All go up against that?
First, by having some insider knowledge of how it works. I do, because another part of my job was equipping lobbyists with talking points, and making sure they had fact sheets and white papers to pass along to members of Congress, for example, to persuade them to see the world from our perspective.
To a certain extent, you have to play the same game, but we'll never have the same resources. They are able to skim off a certain amount of the premiums we pay every month to go to these propaganda and lobbying campaigns. So you're never going to be able to match them. To a certain extent, we're playing a David versus Goliath game here.
Being a nonprofit, we're raising money that is helping us to be in the game, to help push back against the propaganda... I often say that some of the work that I do is to help inoculate people from the propaganda, to help them understand where it's coming from, how the language is developed.
... They keep trotting out the same kinds of language, like socialized medicine, like government-run healthcare, like a government takeover of healthcare. I know where these terms come from. I know how effective they are. So you've got to help people understand how propaganda works. It's not easy, but it is something that has to be done, to have a means of pushing out positive information about what we're proposing and to have a rapid response mechanism to push back against the propaganda. So that's what we're building.
We talked a little bit about the Democratic candidates and one of the things that has come up among some of them who are not as fully embracing of Medicare for All as others is the basic question: how do you pay for it?
Yes, and it's not something that you can answer in a soundbite. It's very easy to discredit a proposal with a soundbite, to scare people. My first experience in doing that was in the early nineties during the time when the Clintons were proposing to reform healthcare. I was part of a war room effort back then to scare people away from their proposals.
We're seeing the same thing played out now, as we have in the intervening years. It is a challenging one because if you're talking about something that switches to a system of publicly financed care, what does that mean? It means that you finance it through taxes. We've been conditioned to see tax as a four-letter word and to fear taxes. So it's the challenge for advocates, and that includes me, to help people understand that.
Consider what you're paying now, you and your employer or you and your union. Consider that a tax that's going ultimately into a private insurance company. You don't elect anyone. There's no accountability, no government accountability in a system like that, but just shift the way you think of what you and your employer are paying as a tax, and that keeps going up every year. In fact, the average cost now of a family plan that's offered by an employer in this country is over $20,000. It's an enormous amount of money.
We also kind of tend to think that our employers are giving their own money to the insurance companies, but that's not true. It's all our money. It's part of our total compensation. So that $20,000, instead of going to an insurance company would go into this single fund. So the "taxes" that you're paying to an insurance company will be taxes that will be going instead to the Center for Medicare and Medicaid Services, which administers the Medicare program that we've had for more than 50 years.
It does require a shift in thinking and it is financed by taxes. [But] it's a much more efficient system. You eliminate so much overhead. So many of the administrative expenses that are associated and made necessary by a multi-payer system would simply go away.
I think in every one of the debates so far, one of the moderators has said, "Well, how are you going to pay for this?" It's a legitimate question, and it's a question that candidates need to answer and need to answer forthrightly... It will be a taxpayer supported healthcare system, but I think candidates are a little shy about trying to explain that...
You've got to spend a little bit of time explaining how that shift will occur. And that by moving to a single-payer system, you eliminate so much that is unnecessary spending.
We spend over three and a half trillion dollars a year on healthcare in this country, far more than anybody else. On a per capita basis, we spend $10,000 per person. It's $10,000 for every American, every person in this country, which is twice as much as the average developed country spends.
It's not because people are getting better care, [although] in many cases they are, it's because of the high cost of administering that's part of the multi-payer system.
The paperwork alone...
And it's not just within the insurance companies and their multiplicity of plans. Doctors and hospitals have to have teams of employees who do nothing more day in and day out but deal with various insurance companies -- trying to figure out what plan one of their patients is in, whether that plan covers and to what degree what the doctors say they need. So it's an enormous waste of resources. At least 30% has been proven to be spent on things that don't improve our care and in many cases set up barriers to care.
But what happens to those people who have those jobs, the people who are pushing the paper and working the computers -- what happens to them?
Well, keep in mind that a lot of the people who are working for insurance companies and for doctor's offices and hospitals are clinically trained nurses who've been hired to do this work. They're no longer attending to patients. They're part of the administration.
Or they're denial nurses.
Exactly right. Rather than helping people get well, they are a barrier to care in many cases. I was doing some research on this a few years ago. United Health alone was hiring 10,000 nurses. They also employ doctors who are no longer providing care but are in administrative positions calling the shots, making decisions as to whether someone will get the care that an attending physician or someone's private physician says that a patient needs. In many cases, these people can go back into providing care. We have an aging population, a growing population, and we need to have more doctors and nurses. So a significant percentage of those can go back to providing care.
Others, the work that they do is not specifically and uniquely for the health insurance business. They have skills that can be used in other industries and other jobs. The legislation that both Senator Sanders has introduced and Congresswoman Jayapal has introduced in the House also provides funding, I think it's for a period of four years, to help people transition to new jobs. And for those who are in their 50s, it provides the assurance that they can have a continuation of income for a period of time.
It's called Just Transition and union leaders who are supportive of Medicare for All have been involved in making sure that people who would lose their jobs or have to change jobs would be taken care of. A lot of the money that would be set aside would help with skills training, even relocation. If you have a pension at risk, that would be protected.
Would some of the money that would be raised through taxes to go into Medicare For All be used to convert for-profit facilities into nonprofit facilities? How do you keep someone who owns a hospital -- because I've seen it happen in my neighborhood and I know it's happening in Philadelphia where you live -- from turning it into condos?
Frankly, that is an issue that has been debated... There has been a proposal that was not included in the House bill that would outlaw the use of federal funds going to a hospital or other institution that has a for-profit status. So for-profit facilities would continue to exist and they could, as they currently are, get reimbursement for the care that they provide.
But there is no magic bullet of a hospital being nonprofit. A lot of the nonprofit health hospitals in the country have closed as have some of the for-profits. The reality is that even the nonprofits largely have to operate like the for-profits do. There's not a heck of a lot of difference. They have different tax status, but in many cases, as we have seen with the University of Virginia scandal -- of that hospital system being very aggressive in collecting debts of people who've received care there -- they operate very much the same way. So just outlawing the use of federal funds that go to a for-profit facility sounds interesting and it has some support, but the reality is that nonprofits and for-profits operate very similarly. They call profits different names and in the nonprofit world, they refer to it as surpluses, but it's the same thing -- just doesn't go to shareholders per se.
You're right about Philadelphia, the Hahnemann hospital that has been there for decades and has served as a safety net hospital for many, many generations is shutting down because it was taken over by a for-profit company and had a number of owner changes and the current owner decided, "Well, this is not making money for us, so we're going to shut it down." I'm fully expecting that before too long we'll see condos where that hospital was.
I was on a speaking tour of Tennessee not long ago and I heard about the rural hospitals that have closed there, and it's not unique to Tennessee, but it just happens that on a per capita basis, more have closed in Tennessee in recent years than anywhere else. A lot of those were operated by for-profit companies that were looking at shareholder interest more than anything else, not community need, and decided for the sake of the company it would be better to shut them down.
Some that have closed have been operated on a nonprofit basis but one of the things that's important in the Medicare for All legislation, in the House in particular, [is that it] would establish something called global budgets for hospitals and other institutional caregivers.
It actually was something that was envisioned in the Clinton plan in the early nineties. There was opposition in the industry [and] there will be as we go forward in this debate, but what global budgeting does is it looks at a lot of factors to determine how much a facility should be a given in a certain year to continue serving the needs of the community - looking over a three -year period of time, for example, taking into consideration the demographics of the area served and making sure that that facility has an adequate amount of money based on recent history to continue providing services to the people who live in the area and depend on it. If you have a system like that, it would eliminate a lot of these hospital closures.
We talked about the Democratic candidates. We haven't talked about the Republicans. Especially since this current administration has been in office, we've seen a constant effort to completely eviscerate the Affordable Care Act. Until the composition of the Senate and the executive changes, how can we hope to see something like what you propose?
I can't predict when it will happen. What I do say is, I think it' s not a matter of if, but when. Who controls the Senate and who controls the House, who controls the White House is a big factor. I don't think we'll see this enacted until Democrats are in control of both houses of Congress and the White House. Will that happen after 2020? I can't tell you. I think there's a good chance, a better chance certainly that we could make progress and get this implemented if Democrats do take control of the Senate.
If not, I think we'll be looking at a few more years down the road until we do see that change in control. Trump could be reelected. We just don't know at this point, [but] the current system is just not sustainable. We're seeing that the employer-based system is unraveling as more and more employers are unable to stay in the game and offer coverage. More people are earning a living in the gig economy and can't rely on an employer to provide coverage. Health insurers can't control cost.
When the Affordable Care Act was passed, we were spending about two and a half trillion dollars on healthcare in this country. Now it's three and a half trillion dollars. So you're seeing that the private system of insurance is not controlling healthcare costs. One of the aspirations, one of the goals, one of the things we need is universal coverage, but we've got to have our eye not only on that ball, but on what is a system that controls costs, because we simply cannot keep going the way we are. More and more employers are going to be throwing in the towel and saying, "This doesn't work."
I think it's conceivable that if there's another four years of Trump and Republican control of the Senate, you'll see further attempts to weaken, to sabotage the Affordable Care Act. There is this belief among a lot of Republicans that it needs to be removed. And some are living in some fantasy world that before the Affordable Care Act was passed, the free market was working or could work.
It would be catastrophic for the country if we got rid of [Obamacare, although] as the late Princeton economist Uwe Reinhardt said when it was passed, it's an ugly Band-Aid on an ugly system, and that's what it is. It helped bring a lot more people into coverage, but you still have 30 million people who don't have coverage and many millions more than that who are now under-insured because of these high deductibles that they have to meet before their coverage kicks in, so it's not sustainable. There is a limit, and I know that employers are getting fed up with having to figure out how can they shift more of the cost of care and premiums to their workers. You can't keep doing that.
So you're hopeful?
Maybe I'm just an optimist by nature, but I'm also a pragmatist. One of the things that I am working to do in my organization is to - using a PR term - condition the environment to help make change more likely. You've got to persuade the public that what you're proposing is solid policy and in their best interest. It's not an easy thing, particularly when you've got a lot more money that's being spent to continue propaganda campaigns to keep people voting against their own best interest. But I feel an obligation to do this, Michael. Because of all that work that I did in my old job I'm making amends. So it's not just optimism, it's an obligation to do this, and to do what I think is the right thing, the right policy both from an economic but also a moral point of view.
So people reading this or listening to this, if they want to learn more about Business for Medicare for All, where should they go?
Go to our website, which is BusinessforMedicareforAll.org. Go there.
We also are launching Medicare for All Now, which will be a 501(c)(4). That will enable us to delve into the political work more deeply. We can endorse candidates and will be able to raise money. We have not endorsed a candidate for president. I don't know that we will in the primaries. We've got Senators Sanders and Warren who are strong advocates of "the damn bill" that Senator Sanders drafted and that has the support of several of his colleagues. As we discussed, not all of the candidates are on board with that, but we very well may weigh in, even in the congressional campaigns, so stay tuned.
Wendell Potter, thank you very much.
Thank you, Michael.
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