Photo Credits: Getty Images / Montgomery County Planning Commission
Sometimes I have to search for my candidates for Ass Hat of the Week, and sometimes they just almost volunteer themselves. This week, I decided to take a break from the election, and it’s never ending clown car of Ass Hat candidates, to point out an example of greed and corporate profits gone amuck. Also, I’m a little early this week, I know. I didn’t want my weekend plans to cause me to miss this, one of my favorite things to write. Enjoy!
I present Mark Bertolini, Chairman and CEO of Aetna, one of the largest health insurers in the country, based in Hartford, Connecticut (the insurance capital of the northeast).
What brought on this honor? Well, it seems that Aetna wants to merge with Humana (one of its competitors), but the Department of Justice is suing to block the merger.
In a nutshell, Bertolini basically told the government that if they blocked the merger, then they would pull out of the Obamacare exchanges, thus becoming the third largest provider to leave the exchanges, and further hurting the Law.
Without getting into too much detail, basically Aetna is saying if the deal fails to close, it would cost them too much to stay in the exchanges, partially at first and eventually fully. Basically, trying to blackmail the Administration to remove its opposition (and drop its lawsuit) to the merger. By withdrawing from the exchanges, a heavy blow will be dealt to the law, which has already seen other large providers leave the exchanges.
What would that mean practically. Well, first of all, the millions who have purchased coverage from Aetna on the exchange would suddenly find themselves (and their families) without insurance; forcing them either to scramble for a new policy, or to accept the return to pre-Obamacare conditions (now with a penalty now for being uninsured). In the bigger picture, it would dramatically reduce the competition in the exchanges, and could drive Premiums up significantly.
Let me stop and say a couple of things here. First, I do not fault a company, or any individual, for being as successful as possible. Make all the money you can, boo boo. Make yourselves and your shareholders rich. It’s the American Way! Now here’s where I digress. I don’t believe that the profit motive should be your only reason for existence! If you’re hurting people, or negatively affecting their lives, and still turning a profit you will get no sympathy from me. That doesn’t mean give away the store, but a responsible company and its management considers the ramifications of its actions.
Too many companies today get away with paying little to taxes, moving offshore, and exploiting workers. If you and your owners and management are making millions with this going on, then yes, someone needs to step in and correct this. The free market? Probably not, since there haven’t been any clear examples of this in my lifetime. These circumstances are not what the “Free Market” has produced naturally. They are simply the result of greed and the pursuit of pure profit for profits sake!
What does that have to do with the price of eggs in Toledo, you ask? Well, Aetna, and Bertolini, are seeking to acquire Humana to reduce competition, allow them to drive prices, and thus make more money. The D.O.J. stands in their way. So, Bertolini does what any other CEO would when they think they have some kind of leverage, they Blackmail and threaten! In this case, the United States government.
Never mind the fact that they will not only harm millions of consumers, who probably needed medical services anyways (as they weren’t insured before the ACA) and the insurance companies view them as costly drains on their bottom lines. Never mind that they might deal a crippling blow to a Law they claim to support. Never mind they said they were committed to “stay the course” while the exchange markets “stabilize.” Never mind their earlier in the year optimism over their involvement with the exchanges.
Now they would have you believe that, unless they add Humana’s business to their own, along with the cost of litigating with the D.O.J., they would not be able to sustain participation in the exchanges, making them the third largest insurer to leave the program.
It is probably worth noting here that Bertolini’s salary in 2015, according to the Hartford Courant, was just shy of $28 million. The Wall Street Journal has his compensation for 2015 at a more conservative $17.3 Million.
Those amounts include significant amounts of bonuses and stock options. If Bertolini is making this kind of money, largely due to those bonuses and options, then one can only deduce that the Company as a whole is likely doing quite well.In fact, the Stock price seems to be climbing higher.According to Morningstar, the company’s revenues are increasing since the same quarter last year. In fact, their Annual Statement, available for download on their Investor Page, does nothing but speak volumes of praise on their business, it’s growing revenues, and it’s social responsibility.
How do we get from this to the threat of leaving the Obamacare exchanges due to financial hardship? Put simply, they aren’t getting what they want. One of the centerpieces of Bertolini’s growth strategy is the planned acquisition of Humana. What happens to his vision if the Feds put a stop to this merger?
So, he did what he knows, threatened to take his toys and go home to Hartford! Like a petulant child, they are lashing out in a hope to get their way. All the people hurt in the wake of that, left uninsured, and sick and in need of coverage; well, to hell with them. Especially if they stand in the way, they will just become collateral damage in his company’s quest to make a buck or two!
Oh yeah, and while he’s at it, pad his bonuses and Options.
I usually don’t pile on to these, but I think this is worth mentioning. The Insurance industry has managed to collect way too much power and influence in this country. We all saw the concerted effort in opposition to Obamacare when the law was first going through Congress. Threats like Aetna’s here, or simply being able to buy politicians when necessary, should not be tolerated, especially when it puts REAL people in the cross hairs, inadvertently or not.
That’s why, especially after this election is over, our Priorities need to include shifting our system to Single Payer (or Medicare for All). For all its failings, the bureaucracy and hoops that inevitably come with any government program, when the government runs something, it will not be for profit, and therefore will not seek to adversely affect people just for the sake of a dollar.
I don’t believe we have a bad Health Care System. Our Doctor’s and Nurses are among the best. But we have a horrendous Health Insurance system. It actively tries to prevent people from getting care and medicines they need in order to save a buck or two. It views a “preexisting condition” as an excuse to prevent that patient from becoming a drain on their bottom line. (before the ACA disallowed this)
I’m sorry Republicans (and Libertarians) but the Free Market has no place deciding the fate of millions of lives across the country. In your world, its o.k. for me to lose my insurance (for whatever reason), be unable to afford new coverage, and thus go without routine care. Until eventually, something is not quite right, and I have to go to the Emergency Room, where I discover I have inoperable cancer that could have been caught and cured with routine care. So then I die, leaving a distraught family, not paying bills anymore, and not contributing to society. But that was all my fault, right? I didn’t pull hard enough on my bootstraps to get out of that predicament, right?
Is that the way you’d really prefer things just so Blue Cross, Aetna, and many more can pay a few extra cents in dividends this quarter?
We need a Public Option in this country. It will save our system, and most likely, a lot of our lives!