- A leaked video of UnitedHealth CEO Andrew Witty defending claim denials after Brian Thompson’s murder has sparked backlash. Critics argue the policy contributes to medical bankruptcies and lives lost due to denied care, highlighting widespread anger at systemic issues in U.S. health care.
In a video recorded after the Dec. 4 murder of Brian Thompson, UnitedHealth Group CEO Andrew Witty said his company's policy of rejecting a certain percentage of claims for coverage was in the best interests of all stakeholders—because the alternative would be a worst-case scenario of a systemic collapse in the health care system.
“We guard against the pressures that exist for unsafe or unnecessary care to be delivered in a way that makes the whole system too complex and ultimately unsustainable,” he told employees.
The video was initially leaked to independent journalist Ken Klippenstein, one of the first to criticize UHG’s treatment of its clients. Fortune reached out to UHG for comment.
According to ValuePenguin, a site that helps users compare insurance plans' costs, UnitedHealth's 32% claims denial rate was twice the industry average.
Captured on CCTV, Johnson’s killing became a polarizing issue as many Americans shared personal accounts of loved ones they claim might still be alive had UnitedHealth not denied coverage of care they believed was needed.
There is broad anger against a system that has plunged millions of Americans into medical bankruptcy.
Broken health care system
Health insurers faced more criticism when Anthem Blue Cross Blue Shield said in mid-November that it would limit the amount of coverage it provides for anesthesia regardless of how long a surgery may take.
The American Society of Anesthesiologists blasted it as “the latest in a long line of appalling behavior by commercial health insurers looking to drive up their profits at the expense of patients.”
ASA president Donald Arnold added it was a “cynical money grab.”
Anthem reversed the decision the day after Thompson’s killing.
The fury directed at UnitedHealth is emblematic of America’s broader inability to reform its patchwork health care system.
The U.S. spends nearly twice as much per capita than the average wealthy industrial nation, according to findings from the Peterson-KFF Health Tracker, published earlier this year.
Health care costs have risen 121% since 2000, faster than the 86% increase for all consumer goods and services over the same period, according to the same data.
American patients pay higher costs
Discovering new drugs is an expensive endeavor that can see a company invest a decade of time and resources to bring a promising treatment to market only to see it fail in the final phase of clinical testing.
Even when a drug is approved by regulators, companies downstream pile on added costs.
Pharmacy benefit managers (PBMs) including UnitedHealth’s own Optum Rx, negotiate rebates off list prices and determine which treatments are covered by insurers. But PBMs are incentivized to drive up costs, since commissions are linked to the list price.
Another layer of costs stems from all the complicated logistics, handling, and compliance around these regulated substances, from the drug manufacturer to the point of sale.
Here just three companies—McKesson, Cardinal Health, and AmerisourceBergen—control 90% of the wholesale distribution market.
Worse health care outcomes
Finally, America’s justice system's propensity to award high compensation over malpractice has driven insurance premiums for several medical professions so high that it discourages medical school students from entering high-risk areas like anesthesiology.
The result is Americans owe over $220 billion in medical debt in aggregate, according to research published by Peterson-KFF.
The overwhelming bulk of that is held by those with more than $10,000 in unpaid bills as opposed to less, with low-income, rural, and Southern Americans affected most.
Unfortunately, there is no upside for patients arising from these higher costs.
“Despite higher health care spending, America’s health outcomes are not any better than those in other developed countries,” the Peter G. Peterson Foundation argued in August. “The United States actually performs worse in some common health metrics like life expectancy, infant mortality, unmanaged diabetes, and safety during childbirth.”
