In so-called “public service” ads appearing on TV and radio, or in print and on the intertubes, many health insurance companies urge people to stay healthy by quitting smoking. The company that provides a supplemental policy to me that covers things not paid by Canada’s national health even e-mailed a helpful PDF brochure with a quit smoking plan.
Guess what? They don’t mean it. None of them do. In fact, they profit if you don’t.
A new study just published in The New England Journal of Medicine documents how major health insurance providers in the US, Canada, and Britain hold billions of dollars in stock in companies that sell cigarettes and other tobacco products.
Wesley Boyd, the study’s lead author, found that at least $4.4-billion in insurance company funds – which come from premiums paid by policy holders – are invested in companies whose highly profitable subsidiaries are major producers of cigarettes, cigars and chewing tobacco.
“Despite calls upon the insurance industry to get out of the tobacco business by physicians and others, insurers continue to put their profits above people’s health,” writes Boyd, a Harvard Medical School faculty member.
Joining a loud chorus of people saying the same thing, Boyd concludes, “It’s clear their top priority is making money, not safeguarding people’s well-being.”
Gee, ya’ think?
Billions of Dollars
Collectively, the health insurance industry controls nearly $4.5-billion of tobacco company stock – a nice down payment on basic universal health care coverage.
Prudential is the worst offender. It has nearly $1.7 billion invested in big tobacco. Its insurance arm, which sells both health and disability coverage, has $814 million in British-American Tobacco stock and another $513 million sitting with Imperial Tobacco while Prudential Financial sits on $186 million of Philip Morris-USA stock, $69.4 million of Reynolds American and $8.8 million in Lorillard.
Canada’s Sun Life, which offers a wide range of group and individual supplemental health plans, is second on the “please smoke our investments and die” list. It has more than $1 billion invested in tobacco companies, including Philip Morris-USA and Lorillard.
Other insurance companies cited in the article holding big chunks of tobacco stock include New York Life and MassMutual. Northwestern Mutual, which sometimes calls itself “the quiet company” but it may have dropped the ad slogan when its wheezing and hacking, smoker’s cough got too loud, also makes the list with a comparatively paltry $253.8 million in stock in big tobacco.
The supreme irony in this is that the insurance companies make money both ways: It charges smokers higher premiums for buying the very products that profit the industry’s investment portfolio.
“Smokers lose twice over,” Boyd writes with just a trace of irony.
How can an industry that profits twice from people smoking themselves into ill health or an early grave be taken seriously when universal health care is being discussed?
By most common definitions, the industry has a very basic conflict of interest. And you don’t have to torture the definition of “conflict of interest” the way Yoo and Bybee tortured the word “torture” to reach this conclusion: The industry simply is not a trustworthy, honest negotiating partner.
No wonder I get a bad case of the creeps whenever I read that Sen. Max Baucus not only is negotiating with insurance companies about health care reform, he’s actually listening to them. This is akin to listening to Sarah Palin explaining about teaching teenaged girls on how not to get pregnant. Ronald Reagan lecturing Paul Krugman on economics. AIPAC helping negotiate a two-state solution to the Israeli-Palestinian problem. It’s a total non-compute.
Baucus would be much better served listening to the wise words of the robot in the old TV series Lost in Space, who proclaimed at least once each episode, “Danger, Will Robinson! Danger!”