Why I’m Breaking the Law for Health Care

On Tuesday, a drama will unfold in Washington that will be unlike anything we’ve seen in the first year of the Obama administration.

I will join dozens of leaders of unions and other public interest organizations and thousands of others to protest the major lobby that is blocking real health care reform in Congress. We will hold a rally and then march to a Washington hotel where America’s Health Insurance Plans (AHIP), which represents all the corporate heavies in the health industry, will be plotting their next steps.

The demonstration is being organized by Health Care for America NOW!, a national grassroots campaign for quality, affordable health care. This coalition asked the directors of about 100 groups to risk arrest at the event. I will be joined by Institute for Policy Studies board member Barbara Ehrenreich, AFL-CIO President Richard Trumka, and other allied group leaders.

That dozens of leaders would risk arrest in confronting the corporations that stand squarely in the way of fundamental change represents a new moment for our social movements. There is a growing realization that giant health care, fossil fuel and financial firms will stop at nothing to block fundamental change. In this case, the leaders of the giant health insurance companies have joined with CEOs of the largest pharmaceutical firms to buy the votes in Congress to block fundamental health care reform.

Hence, we must up the ante if we are to create the change this country so desperately needs.
One thing that must change is the executive pay system. Chief executives of the top five health insurance companies raked in a combined total of more than $113 million in 2007 and 2008, according to executive pay experts at my organization, the Institute for Policy Studies. All five of these firms — WellPoint, UnitedHealth Group, Cigna, Aetna, and Humana — are represented on the board of directors of the AHIP lobby group.

The highest-paid health insurance exec was Ronald Williams of Aetna, who made $35.6 million over the past two years. It would take an American worker with average pay more than 1,000 years to make that much.

Soon to be released pay data for 2009 are likely to show continued executive excess, since these firms maintained high profit levels last year, while at the same time ordinary Americans were reeling from rising health care costs and soaring unemployment.

We know now that the out of control executive pay system was a cause of the financial crisis. But it’s not just in the high finance world that outrageously high rewards encourage executives to take actions that put the rest of us at risk. The greater the potential reward, the greater the temptation to grab that reward by any means necessary. In the health insurance industry, that has meant denying coverage to people with health problems that might cut too much into the corporate bottom line.

A health crisis for the rest of us just means a bigger paycheck for the executives.
Throughout the economy, executives seeking massive personal rewards behave in ways that are bad for the economy in the long term — reckless investing, shortchanging worker training and slashing R&D, hammering consumers, or, should all else fail, simply cooking the books.

UnitedHealth Group, the nation’s largest health insurance company, was nabbed a few years ago for backdating stock options in order to jack up payouts for top executives. The firm had to oust their CEO and pay $895 million to settle a class action lawsuit over the scandal — just one example of the kind of risks executives are willing to take in order to line their own pockets.

And, these firms have reaped enough profits from an increasingly unhealthy America that in addition to outrageous CEO pay, they have plenty left over to block most meaningful change in the “best Congress that money can buy.”

The stakes are undeniably high: Just listen to the stories of people in your own communities who were denied coverage by their insurers. Just as the Biblical David faced down Goliath, one hundred of us are willing to go to jail tomorrow if it will send a clear message to the CEOs of our nation’s health insurance plans: They cannot grow rich while the rest of us grow sick and tired.

John Cavanagh is director of the Institute for Policy Studies.