The Center for Public Integrity

Opponents of the Affordable Care Act who believe the Supreme Court will declare the law unconstitutional are going to be disappointed next year when a majority of the nine justices vote to uphold it. It will likely be a 5-4 decision, but moderate conservative Anthony Kennedy will, I’m confident, recognize that without the law, the free-market system of health insurance, so highly valued by conservatives, will implode, sooner rather than later.

The high court announced earlier this week that it will hear oral arguments on the constitutionality of the law next March. A decision is expected in June, just a few weeks before the parties hold their conventions. Regardless of which way the justices go, the decision will ensure that health care reform will be as contentious a campaign issue as it was in 2008.

Here’s the reality. The provision of Obamacare at the heart of the constitutional challenge — the requirement that all Americans will have to buy health insurance if they’re not eligible for a public plan like Medicare or Medicaid — is a “must have” for the nation’s health insurance industry.

The plaintiffs who filed the lawsuits, including the attorneys general of 26 states, either haven’t been paying attention to what’s been happening in the private insurance market or have chosen to ignore it because of blind allegiance to ideology.    

The indisputable fact is that our employment-based system of private health insurance has been crumbling for years — to the point that potential new business for health insurers is, for all practical purposes, nonexistent. And ironically, it is their practices and policies, made necessary by profit-hungry shareholders, that have led to this state of affairs.

If there is one organization that insurers despise and fear more than any other, it surely must be Consumer Watchdog.

Since its founding in 1985, Los Angeles-based Consumer Watchdog has dogged insurers relentlessly and played a key role numerous times in forcing them to change business practices and price their policies more fairly. I first heard of the organization in 1996 when I was still an insurance industry spokesman. Consumer Watchdog seemingly came out of nowhere to take the lead in trying to put a halt to a new practice in the insurance industry: requiring women to be discharged from the hospital within a day after delivering a baby or undergoing a mastectomy. Largely because of Consumer Watchdog’s efforts, insurers had to rewrite their discharge policies.

The organization’s first major attack on the insurance industry — a ballot initiative in California (Proposition 103) require auto insurers to seek prior approval from regulators before increasing rates — has saved drivers in the Golden State more than $62 billion over the past two decades, according to an analysis by the Consumer Federation of America.

The insurance industry spent nearly $63 million to defeat Proposition 103 back in 1988, but that was no match for the indefatigable founder of Consumer Watchdog, Harvey Rosenfield. Rosenfield, a lawyer who helped write the proposition, proved that a David can still bring down a Goliath, or at least reduce Goliath’s power and profits, with the modern-day equivalent of a slingshot — savvy media relations skills.

Rosenfield enlisted the support of consumer advocate Ralph Nader, and the two of them crisscrossed the state demanding that local TV and radio stations present their point of view on Proposition 103 to balance out the massive advertising campaign insurers were waging to kill it. It worked.

The special interests seeking to gut those portions of the health reform law that  would be of greatest benefit to consumers clearly believe there is no such thing as historical memory in Washington.

Why else would they bring one of their old front groups out of the storage locker, with just a single new word added to its name? A front group designed to persuade Americans that what they might have thought was in their best interests really isn’t after all.

In the late 1990s, health insurers and their most reliable business allies — including the U.S. Chamber of Commerce and the National Federation of Independent Business (NFIB) — set up a front group called the Health Benefits Coalition. Back then, the industry’s target was the Patient’s Bill of Rights, which would have made insurance firms behave in a more consumer-friendly way. Among other things, the bill of rights would have forced insurers to make an external review process available to health plan enrollees who were denied coverage for doctor-ordered treatments. It also would have given enrollees an expanded right to sue their insurers for wrongful denials of coverage.

The Patient’s Bill of Rights was popular with the public, health care providers and members of Congress on both sides of the aisle. It attracted bipartisan support in both the House and Senate. The sponsors of the Senate version of the bill, in fact, were none other than Republican John McCain of Arizona and Democrat Ted Kennedy of Massachusetts.

Insurers hated it, of course, but knew they would not be able to kill it without the support of other powerful groups. They set out to persuade the Chamber, the NFIB and other groups with clout in Washington, including the National Association of Manufacturers, to join them in creating a new front group that would be operated out of a big PR firm in Washington, Porter Novelli.

Support for ObamaCare has fallen to just 34 percent of the American public, according to the Kaiser Family Foundation’s most recent tracking poll. That’s down from 41 percent in just one month.

Can’t say I’m surprised. Just as they did during the debate on health care reform in 2009 and 2010, the special interests who profit from the status quo have been winning the messaging battle in their ongoing effort to scare people away from the new law. They have a well-planned and executed strategy to mislead people so thoroughly they will vote next year for candidates who promise to repeal the law, even if that means they will be voting against their own best interests. The strategy of the law’s backers — if indeed there is one — is simply not working.

One reason reform advocates cite for the decline in support: relentless attacks on the law by GOP presidential candidates, especially during those free-for-all debates. At one of the recent get-togethers, Newt Gingrich even resurrected the biggest of the big lies — that the law creates government-run death plans that will decide when to pull the plug on sick Medicare beneficiaries. Supporters can’t expect debate moderators to challenge the candidates on such baseless accusations, and they don’t have comparable forums to communicate how the law is helping millions of Americans. At least not yet.

Another factor in falling support for ObamaCare is that opponents are outdueling supporters in placement of op-ed commentaries and letters to the editor. While I haven’t seen detailed analyses of the op-ed placement war, my own observation, as someone who reads a lot of newspapers, is that the critics have gotten way more ink than the fans.

That doesn’t surprise me, either. During my years as a health insurance industry PR guy, I helped craft and implement plans that involved recruiting seemingly ordinary folks to send letters and op-eds that had actually been written by industry flacks.

I have no inside information about the nature of GOP presidential candidate Herman Cain’s relationship with two women who claimed Cain made unwelcome advances toward them when he headed the National Restaurant Association in the 1990s. I do, however, have first-hand knowledge of a mutually beneficial affair Cain was engaged in around that same time — with the health insurance industry.

Soon after President Bill Clinton unveiled his health care reform proposal in October 1993, the nation’s big insurers and other special interests joined forces under the auspices of the Healthcare Leadership Council to develop a strategy to kill it. I made several trips to HLC meetings in Washington as a representative of CIGNA to participate in the planning sessions. 

One of the outcomes of those brainstorming meetings was a nationwide health care reform videoconference, sponsored by the leadership council and underwritten by CIGNA, at which Cain, virtually unknown to the public at the time, played a key role.

Although it was billed as a forum “in which experts will examine the provisions of President Clinton’s health care proposal against the major alternative plans,” the real purpose of the 20-city videoconference was to turn the country’s business leaders against the Clinton blueprint.  

The event cost hundreds of thousands of dollars, some of which was used to hire 60 Minutes correspondent Lesley Stahl to moderate the program. One of my colleagues who worked with Stahl told me she complained afterwards that she had been led to believe that the video conference would be a balanced pro and con discussion of the Clinton plan, which in fact it was never intended to be.

If you have no idea what you’re paying good money for when you enroll in a health insurance plan, there’s a good reason for that: insurers profit from your ignorance. And they’re waging an intense behind-the-scenes campaign to keep you in the dark.

In my first appearance before Congress after leaving the insurance industry, I told members of the Senate Commerce Committee that insurers intentionally make it all but impossible for consumers to find out in advance of buying a policy exactly what is covered and what isn’t and how much they’ll be on the hook for if they get sick or injured.  Insurers are quite willing to provide you with slick marketing materials about their policies, but those materials are notoriously skimpy when it comes to useful information.  And the documents they provide after you enroll are so dense few of us can understand them. 

In the months following my Senate testimony, lawmakers drafting health reform legislation included a provision requiring insurers to both provide comprehensible disclosures of health plan benefits and make that information available to anyone shopping for coverage. Despite repeated attempts by industry lobbyists to get that provision stripped out of the final bill, the Affordable Care Act as signed by President Obama last year requires that all private health plans provide consumers with a concise and understandable Summary of Benefits and Coverage (SBC) form. In addition, they must provide a uniform glossary of medical and insurance terms.

If you think that sounds like a reasonable request, you’re not an insurance company executive who is rewarded more for meeting Wall Street’s profit expectations than assuring that consumers know what they’re buying.

Members of Congress and the Obama administration have assured us that on January 1, 2014, junk health insurance plans — which offer only the illusion of adequate coverage to the millions of Americans enrolled in them — will become a thing of the past.

Among those who clearly don’t believe those plans are headed for extinction are the insurance companies that market these highly profitable plans and the employers that buy them — primarily restaurant chains and retailers with high employee turnover.

If I were President Obama, I would send one of my aides to the Chicago suburbs later this week to see first-hand just how determined these companies are to continue selling these plans — which are euphemistically called “mini-med” and “limited-benefit policies” — long past 2014.

On Wednesday, 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.

As I wrote last week, Maine and California are taking radically different approaches to implementing health care reforms within their boundaries. While the GOP-controlled government in Augusta has passed legislation that gives health insurers far more control of the health care system than they’ve ever had, lawmakers in Sacramento are taking California in the opposite direction. They’re moving rapidly to implement the federal Affordable Care Act, and if Insurance Commissioner Dave Jones and many of his former colleagues in the legislature have their way, California will be among the first states to implement a single-payer system in the years ahead. I spoke recently with Jones about the benefits and shortcomings of the federal reform law and why, even as commissioner of insurance, he continues to be an ardent single-payer advocate.

iWatch News: After nine months in office, what’s your overall assessment of the health insurance marketplace in California?