Tuesday, October 27, 2009

Are Health Insurers Villains?

Since I direct the ethics program at a health insurer (Harvard Pilgrim Health Care - a regional non profit company serving 1.1 million members in Massachusetts, New Hampshire and Maine), I've thought a lot about our national assault on insurers as "villains."

I've come to see the dissing of insurers as arising from five sources: (1) incidents of real "villainy"; (2) a critical view of the U.S. "system" of competing insurers; (3) lack of public acceptance of the need for stewardship; (4) societal PTSD from the managed care era; and, (5) politicians' need for a scapegoat.

  1. The biblical story about Lucifer indicates that even angels commit evil deeds. If angels can't avoid sin, it's not surprising that virtually every human enterprise includes "villainy." Large organizations, such as insurers, are especially vulnerable to flying at 30,000 feet and not seeing the impact of what they do on the individuals they deal with. And, having many employees increases the risk that an individual employee will be inept in ways that cause harm or deliberately roguish. This risk is just as true for churches, hospitals, schools and other organizations. There's no reason to think that health insurers are cut from a different cloth than the rest of us. But because health care is a sacred calling, examples of bad behavior outrage us.

  2. A substantial number of Americans regard the current structure of the U.S. health "system" itself as unethical. I agree. For many, that view leads to blaming health insurers for the rules of the game they are playing in. It's as if a pacifist blamed football teams for tackling each other when their real critique is of the game itself. The system we're currently in requires insurers who want to remain solvent to screen people who enroll as individuals for preexisting conditions. If Mother Theresa were made CEO of an insurer in the U.S. she could not discontinue the practice. (Because the "system" requires practices of that kind she would turn down the job and stay in Calcutta!)

  3. I've written many times about our national failure to understand that containing health care costs is a ethical requirement, not a moral abomination. For the public, caring about patients ("fidelity") is "good," while managing costs ("stewardship") is "evil." We confuse the aphorism "life is priceless" with economic truth. Much political rhetoric asserts that what the physician prescribes is ipso facto "medically necessary" and therefore should not be questioned. Since provider behavior drives the cost of insurance this puts insurers an the unenviable position - the only positive role for them is to pay for what the physician or hospital recommends.

  4. In the 1980s/1990s U.S. social policy asked insurers to manage care. Except for organizations like Kaiser Permanente and Group Health Cooperative this split caring for patients ("fidelity") and responsibility for health care funds ("stewardship") into opposing camps. The public, and physicians in fee for service practice, believed that physicians cared about patients and were "good," while insurers cared about money and were "bad." This was especially true with for profit insurers, but all health insurers are still tarred by the managed care brush.

  5. Politics proceeds via sound bites designed to arouse emotion. Politicians need enemies. For the conservatives it's "socialized medicine" and "takeover by government." For the administration it's "greedy health insurance villains." These simplified, reflexive positions fire up the political base but create a major obstacle to thoughtful political discourse. We saw this process in clearest form in the mindless conservative rants about "death panels," but the global vilification of health insurers as "villains" is equally mindless.

Much of the journalism I've read in venues like the Boston Globe, Los Angeles Times, New York Times and Washington Post has been thoughtful and sophisticated. What's not yet clear is how much we - the public - have learned thus far from the health reform process. My pessimistic self says we're stuck in sound bite mud. But my optimistic self says we're inching forward in our understanding of the ethics of our health system.

The answer isn't yet in!


Unknown said...

As a healthcare system physician executive and a former Medicare Advantage Plan medical director, I offer the following thoughts and observations.
1. Villainy amongst health insurers takes many forms. First, there are the obvious cases ("big fish stories" in the media) about denials of life saving treatments that should have been covered. When a line is crossed in that a arguably medically necessary case or borderline case is denied and the results are death, then this is outright villainy. These cases are porbably few on a percentage basis, but I do not believe penalties reflect the severity of the consequences.
2. "Process villainy" is something that many providers and consumers suspect, which I arbitrarily define as the DELIBERATE use of convoluted, complicated processes and delays to discourage the payment of claims, resulting in clinical or financial harm to many thousands of beneficiaries.
A real problem is that there is very little literature to quantify this problem or accurately reflect its impact.
Many ethical insurers do exist, and I was associated with one. But other executives within our organization relayed stories of working at other commercial plans and the callousness of decision making.
3. I wholeheartedly agree that cost and medical necessity are realities, and that coverage decisions are not inherently evil.
Whether the left or the right attempt to scapegoat greedy insurers, pharmaceutical companies, or faceless bureaucrats, the problems remains of how to allocate expensive care to many in a manner that does not bankrupt the US economy and rewards quality more than merely volume

Jim Sabin said...

Hello Richard -

Thank you for this very thoughtful comment and for sharing your experience in medical management.

You have the makings of a valuable article or op ed piece here - a typology of insurer "villainy" and "pseudo-villainy." Your description of "process villainy" is especially useful. I vaguely recall a Sounding Board article from the New England Journal, probably in the 1990s, discussing "process villainy" as a technique used by some managed care companies to control costs via the "hassle factor." I know there is widespread suspicion about "process villainy." Insofar as it is done deliberately it's incurs a high cost with regard to trust from consumers and providers. Ineptitude is bad, but more forgivable, especially when it is acknowledged, apologized for, and fixed.

I think we'd agree that demonizing insurers when they set limits that are based on evidence and done in an open manner is "pseudo villainy." In discussing the ethics of limits I often invoke the image of Mother Theresa as CEO to make the point that setting the right kind of limits is an ethical responsibility, not a moral crime.

I appreciate your comment - I hope you "visit" again!