Former Insurance Exec Offers An Insider's Look At Obamacare.

July 11, 2013

Guest: Wendell Potter

DAVE DAVIES, HOST: This is FRESH AIR. I'm Dave Davies, in for Terry Gross, who's off this week. When the Obama administration announced last week it would delay implementation of the Affordable Care Act's requirement that employers with more than 50 fulltime workers offer health insurance, critics were ready to pounce. At a House committee hearing yesterday, Republican members said the move shows the law is fundamentally flawed and its implementation a mess.

Supporters argue there are always glitches in implementing complex legislation, and that the law's central reforms will be effective. While there will be more debate and no doubt confusion about the Affordable Care Act, many of its key provisions are just months away from taking effect. Penalties for certain people who go without insurance will be in place next year, and the online health insurance marketplaces called exchanges will be offering policies this fall.

But resistance from many state governments to parts of the act have complicated things, and will likely leave many uninsured Americans facing difficult challenges. To help us sort out what's coming, we turn to Wendell Potter. He spent years as a public relations executive for health insurance firms, but left and eventually wrote a book critical of the industry called "Deadly Spin." He's now a senior analyst at the Center for Public Integrity and a contributor to the Huffington Post.

Wendell Potter, welcome to FRESH AIR.

WENDELL POTTER: Thank you, Dave.

DAVIES: Before we talk about the Affordable Care Act, let's hear just a little of your story. I mean, you were, for many, many years, a public relations executive in the health insurance industry. Why did you leave?

POTTER: I was an insurance industry executive for about 20 years, and I was a journalist in my first career. I was a newspaper reporter. And I grew up in the Southern Appalachian area in eastern Tennessee. And in 2007, I went back home just to visit my folks and read in a newspaper about something called a health care expedition that was being held not far from where I grew up.

And I went there out of curiosity. The paper said that people were expected to drive from as far away as Ohio and South Carolina to come to get care that was being provided free by doctors and nurses and dentists who were volunteering to do this over three days.

I went there, borrowed my dad's car, and when I got there, I saw something I just would not have expected, never would have expected to have seen in the United States. It was such a jolt to me that I, that day, decided I had to do something else for a living. I saw people who were lined up for hours, in lines that just stretched out of view. And it was raining. They were soaking wet.

And I noticed that the lines led to barns and animal stalls. And it occurred to me that I was one of the lucky ones. I could have grown up, and probably did grow up with some of those people. I could have been one of them if I hadn't had some lucky breaks along the way.

And I realized, too, that what I was doing for a living was, in some way, perpetuating the status quo, which was not working for those folks. And I made a commitment that day. It was an epiphany. I made a commitment that I would pretty soon figure out some way else to earn a living and, if I could, help to advocate for reform.

DAVIES: These were folks waiting in line to see a physician or medical care?

POTTER: They were. They were all there to get care, because they couldn't afford to get it otherwise. Most of these people, almost all of them, were uninsured. These were not the poorest Americans. They were not on Medicaid. They were what a lot of people call the working poor. They had jobs, for the most part, but many of them were uninsured, because their employers didn't offer coverage.

Others had lost their jobs, and in this country, most all of us are a layoff away from being uninsured, as well as unemployed. So they were there waiting to get care that they, you know, they couldn't afford to get otherwise.

DAVIES: You'd spent all those years in the health insurance industry. Were you really surprised that there were needy people out there that were uninsured?

POTTER: I shouldn't have been surprised. But what happens when you are an executive at an insurance company? And it's certainly not necessarily unique to the insurance industry. Any senior executive, you live in a different neighborhood. You associate with different people. You don't necessarily come into contact, in your day-to-day life, with people who are needy. So out of sight, out of mind.

And they had been out of sight and out of mind for me, and that ended it for me when I went to that health care expedition. I was not able, from that point on, for them to be out of my mind. They were always on my mind after that, and that was why I ultimately decided to leave my job.

I had begun to become disillusioned with my job. I realized that what I was doing, often, was, in many cases, the exact opposite of what I was doing as a newspaper reporter: trying to present information in as unbiased way as possible, to not selectively disclose information to mislead. But I was often doing that in my job, and that was a crisis of conscience, as well.

When that dawned on me that I was doing that, I couldn't not change. I needed to do something differently. I think I might not have done that had I not been a journalist, and I might not have done it had I not just happened upon that health care expedition.

DAVIES: Let's talk about the Affordable Care Act, Obamacare. Even the president embraces the term. What are some deadlines that are coming? What are we going to see this fall?

POTTER: It's a very important period of time. On October the 1st, we'll be seeing the so-called exchanges up and running. This is a very important provision of the Affordable Care Act. Every state and the District of Columbia will have to have an online marketplace up and running on October the 1st, and they will.

Some states will be operating the exchanges themselves. Others will be doing it in partnership with the federal government. Others are just saying to the feds, you do it. But regardless of that arrangement - whichever arrangement it is - all the states and the District of Columbia will have a place where people can finally go to get coverage and be able to compare one health plan with another, will be able to get information in plain language that enables them to figure out what it is they're actually buying, to get some idea of how much they'll have to spend out of pocket if they choose one plan versus another.

I know from what I've done for a living that insurance companies profited a great deal from consumers being uninformed and not being able to get the information that they really need or understanding the information they're given when they buy health care coverage. So this is a very, very important first step.

DAVIES: All right, so on October 1st, these online marketplaces called exchanges are supposed to go live. But these are for folks who don't have insurance and want to purchase an individual policy, I guess. When is the requirement that everyone get insurance or pay a penalty, when does that take effect?

POTTER: That takes effect on January the 1st. And, in fact, the policies that people can start enrolling in on October the 1st - the very first day that the exchanges are going to be live - those policies they sign up for will be effective on January the 1st. And that is the day that the individual, the so-called individual mandate also goes into effect. Most Americans will be required to get coverage.

You know, most of us do have coverage. Most of us get coverage through the workplace. So most Americans won't be affected by this change. But like I said, we're almost all a layoff away from being uninsured. So whenever we need to buy coverage on our own, this will be the place to go. And it is called the individual market. It's not for people who work for large employers, but it is for people who are not able to get coverage through their workplace, or they work for small companies that don't offer coverage right now.

DAVIES: California's fairly far down the road towards setting up its exchanges. What can we learn about their experience, from their experience?

POTTER: Right. California was probably the first state that started to work on it. It - almost as soon as the health care reform law was enacted, then-Governor Schwarzenegger set things in motion to get ready for the exchange in, obviously, the biggest state in the country.

And they've made a lot of progress. They're doing things a bit differently in California. The exchange board out there, Covered California, will actually be doing quite a bit of screening to make sure that the insurance companies that want to participate are offering quality coverage.

So they will be making some decisions and excluding some insurers or health plans that don't meet certain criteria. And we've seen already that the concept seems to be working. In California and Oregon and Washington, some of the other states that have indicated what the rates are likely to be because insurance companies are beginning to submit what they plan to charge, we're seeing that the competition is working in keeping the rates low.

And in some cases, insurers that were offering policies or saying that they were going to charge higher, more than their competitors, have come back and said after we've seen the competitors' rates, we're going to resubmit.

DAVIES: Now, anyone who's gone out to try and look for an individual policy under the current system, you can find it pretty confusing. I mean, there's - it's hard just to compare the terms, and you're not quite sure how comprehensive the policy that you're getting may be. How will that process, under the Affordable Care Act, be different?

POTTER: It'll be different in very significant ways. In today's world, there is no standard definition of things like co-insurance or copayments. People don't know, necessarily, a lot of what the terms are. But they'll have to be spelled out by any health plan that is offering coverage through the exchange. And we'll be able to compare one plan with another, and information will have to be presented in a standardized format, not unlike the food labels, the nutritional labels on food that we buy in a grocery store.

In fact, that was sort of a model that Congress looked at, and most consumers take it for granted. And something that will be going away will be the fine print, and that's where a lot of the most important information has been hidden. But insurance companies will no longer be able to hide the most important elements of what is covered and what's not in fine print.

It'll have to be stated very explicitly and again in language that people can understand.

DAVIES: What's an example of things that appear in fine print now that won't be there?

POTTER: Like things that might not be covered under certain circumstances. Some health plans, the so-called limited benefit plans, often don't even cover hospitalization. But a lot of people buy these plans without realizing just how skimpy the benefits are. Those plans, by the way, won't even be legal after the first of next year. The Affordable Care Act does require that we get some value for what we're paying for, which is another big change, as well, too.

DAVIES: I wanted to focus on that because some people have used the term junk plans. There are plans out there now, which someone can buy and think hey, I'm getting at least catastrophic coverage, and sometimes they're not. That will be different now?

POTTER: It will be very different, and there absolutely are junk plans that are out there today. And some of the biggest insurance companies sell them, and they're very profitable for insurance companies, and a lot of people don't know they're in junk plans until they get sick or injured, and then they find out at a time when it's really quite frankly too late that they're not adequately covered.

And some of them have lifetime or annual caps on how much the insurance companies will pay. And increasingly health insurance plans have very high deductibles. Insurance companies in these cases don't pay anything for coverage until you've paid quite a bit of money out of your own pocket. That's not a bad deal for people who are quite wealthy and people who are healthy and don't really need insurance, but for the rest of us, for folks who get sick occasionally or who get very sick or injured or who are not as young as healthy as we once were, these plans are not necessarily the best things since sliced bread.

So there will be many consumer protections in the law that go into effect on January 1st.

DAVIES: Can those still be offered through employer-based plans?

POTTER: No they cannot be offered through the employer-based plans, either. The Affordable Care Act does require that employers also offer what's called a package of essential benefits, and that's as it should be because even a lot of employers today recruit people with the promise of having or offering health coverage, but often it's not very good health coverage at all.

So going forward, after January 1st, not only will people be assured that they're getting some value for what they're paying if they buy it on their own, but also their employers will have to offer decent coverage, as well.

DAVIES: All right, so there'll be some uniform standards that you have to offer a real insurance plan.

POTTER: That's right.

DAVIES: And it will have to be displayed in such a way that so you can make relatively easy comparisons from plan to plan.

POTTER: Right.

DAVIES: Now, I read last week that a bunch of large insurers have announced they're not going to be offering individual policies on the exchanges. I think you might have written about this.

POTTER: I have.

DAVIES: So if some big insurers aren't going to be offering plans on these online marketplaces, these exchanges, who's going to do it? Are there going to be people there that - are there going to be firms that are going to meet our needs and compete for our business?

POTTER: You know, I think it will vary from state to state. Some states already have many insurance companies that are competing and will, and the exchanges will have many different options, many options that are available on October 1st. Some states not so much because insurers in the past have not really spent, you know, devoted a lot of attention to some states.

But I think most states will have some meaningful choice. Some states, like Vermont in particular, have limited choice. Vermont is moving toward a single-payer plan. So they were not looking to have a lot of plans participating in the exchange. California will have many. Other states will have many. So it will vary from place to place.

But we shouldn't worry that AETNA and CIGNA and United are not going to be in every exchange because they don't have a presence, nor do they have a lot of the expertise, to offer policies in those states in the individual market.

DAVIES: So are you going to see new firms popping up? I've heard of the term co-ops.

POTTER: You're going to see a lot of co-ops. In fact, 23 co-ops have received loans from the federal government to be able to start offering policies beginning January 1. Twenty of those already have been licensed by the individual states. So in those states, and I think probably between now and October 1st, we'll see the other three that will also be licensed.

That will be a brand new choice. Co-ops are going to be locally owned. People who are going to be on the board are people who are from the communities. They will not have the high overhead that the big, national insurance companies have. And those are some of the reasons I think that we'll see that they will offer some of the most affordable choices.

They don't have - they will not have to spend a lot of money rewarding shareholders or paying CEOs exorbitant salaries.

DAVIES: Now, how can a consumer be sure that the co-op will have the resources it needs to pay claims?

POTTER: Well, first of all they have to be licensed by the state Department of Insurance. And one of the things that the Department of Insurance will look at is the ability of the - of any insurance company that wants to do business in the state, that they have the financial wherewithal to be able to do that, and they have enough money in reserves to be able to pay claims.

So solvency is a very important thing that insurance departments look at, and if they think that a co-op is not positioned to be solvent, then they won't be approved. But like I said, at least 20 already have been licensed to be approved and to operate in those states.

DAVIES: We're speaking with Wendell Potter. He spent years as a public relations executive in the insurance industry. He's now a senior analyst at the Center for Public Integrity. You can also read his blog at wendellpotter.com. We'll talk more after a short break. This is FRESH AIR.

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DAVIES: This is FRESH AIR, and if you're just joining us, our guest is Wendell Potter. He's a former public relations executive in the insurance industry. He's now a senior analyst at the Center for Public Integrity and a columnist for Huffington Post. He also has his own blog at wendellpotter.com.

And we're talking about the impending requirements of the Affordable Care Act, also known as Obamacare, what it's going to mean for consumers and for health insurance in the United States.

There's a lot of uneasiness about the Affordable Care Act, and there are a lot of people who never liked it and are going to do, you know, do what they can to stoke that. But there are also issues that come up. People are talking about rising insurance premiums. I mean, I work for a mid-sized employer, and our Blue Cross rates went up 20 percent this year. To what extent are we seeing this, and to what extent can it be reasonably attributed to Obamacare?

POTTER: Very little of the increases that we've seen so far can be attributed to Obamacare. What people often don't know and that the critics of the law would like for us to forget is that between 2000 and 2010, private insurance premiums increased 131 percent. And this is in the employer market. That's significant.

That means that in almost every year, there was double-digit increases in premiums. And that is because insurance companies have shown that they're just simply not able to keep a lid on health care costs. So what they have been doing is just making sure that they have a certain profit that's built in over and above what they expect to pay in medical claims.

So it's been going up for a long, long time, and in fact just a couple of years ago, the insurance commissioner in Colorado did an analysis of the rate increases in Colorado to determine how much, if any, was attributable to Obamacare, and it was about two percent. So two percent of the increase at that time was attributable to some of the elements of Obamacare.

But keep in mind once again that the Affordable Care Act does not largely affect employment-based insurance except for those small companies, small to mid-sized companies that are offering inadequate coverage that will not meet the essential benefits requirement.

DAVIES: Now there was, I believe, a Congressional Budget Office report that estimated that by 2022, which I guess is, what, nine year from now, about seven million people would lose or drop employer-based coverage. Is this a concern?

POTTER: I don't think it's a concern because we've been seeing that happen over the past several years. I've been watching this for many years and watched it while I was in the insurance industry. We've seen a steady decline in the number of companies that are offering coverage.

And a lot of that decline has been in the small to mid-sized marketplace. And one of the reasons for this is because of the practices of the insurance companies. There's a practice in the insurance industry known as purging, and this affects small employers in particular, almost exclusively.

And the way it works is when an employee or a dependent gets sick or injured, and there are high medical bills, the insurance company will then take another look at whether they're charging enough. And based on that maybe experience of one person, when the policy comes up for renewal, they'll jack the rates up really high, often so high...

DAVIES: That's the rates for everybody in that employer group, that company.

POTTER: Exactly.

DAVIES: That company finds that the next year, suddenly their rates are higher because their employees needed some care.

POTTER: That's right, and it could have been just one employee. In many cases, the employer has - or the small business owner has said I can't afford this anymore. We've been seeing that happen for many, many years. It has been a steady decline. Fewer people get coverage through their workplace now, on a percentage basis, than 10 or 15 years ago.

So that would be a continuation of a trend. And I do think that as the exchanges become more viable, as people know more about them and see that there are plans of value and that they can get coverage at a discounted rate, that we will see more and more people signing up for coverage in the exchanges.

But on the other hand, the Affordable Care Act does provide tax credits to small employers to offer coverage. So we're seeing a lot of small employers offering coverage now for the first time. I've met a lot of small business owners who have said they just simply couldn't do it in the past, but that one provision of the law has been very helpful to them.

There are a lot of small businesses that are offering coverage now because of these tax advantages that are available to them than has ever been the case in the past. In fact, small businesses have been at a distinct disadvantage to large employers. So this kind of levels the playing field.

DAVIES: Wendell Potter is a senior analyst at the Center for Public Integrity and a contributor to the Huffington Post. He'll be back in the second half of the show. I'm Dave Davies, and this is FRESH AIR.

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DAVIES: This is FRESH AIR I'm Dave Davies in for Terry Gross who is off this week. We're looking at what to expect from implementation of the Affordable Care Act or Obamacare. Online insurance marketplaces, called exchanges, will be offering policies on October 1st with tax credits available for those who meet income guidelines. And penalties for certain people who decline coverage will be in effect next year.

We're speaking with Wendell Potter, a former health insurance industry spokesmen who left and wrote a book critical of the industry. He's now a senior analyst for the Center for Public Integrity and a contributor to the Huffington Post.

You know, it was recently announced that the administration would delay the requirement that employers of what, up to 50 people either offer insurance or pay a penalty. And folks looked at this and said ah ha, even they realized that this is a Rube Goldberg contraption; it's dysfunctional, it's unworkable.

POTTER: Well, first of all, it is a complicated law. We have probably the most complicated health care system on the planet. And there were a lot of problems that needed to be addressed and the Affordable Care Act tries to address as many as possible. And there will be some unintended consequences, and as we are seeing, some delay in the implementation of some of the provisions of act, such as the one you mentioned, of postponing for one year the requirement that certain large - midsize - and large businesses have to offer coverage. But keep in mind also, that the vast majority of them already offer coverage. It really wasn't going to apply or affect many employers at all. Employers, 50 employers are less, are exempted from that requirement. And 94 percent of employers with between 51 and 199 employees also already offer coverage. And I think 98 percent of larger employers offer coverage. So it was not going to apply to many people to start with or many companies to start with. And it's not an indication that it's unworkable, it's just an acknowledgment that a lot has to be done between now and January the 1st. this is one thing that can be postponed for year because it doesn't affect a lot of companies or individuals.

DAVIES: We've been talking about these online exchanges, which are supposed to go live October 1st, which offer policies. The main way the Affordable Care Act, as I understand it, was to expand insurance to those previously uninsured was through a dramatic expansion in Medicaid - the government-sponsored program for poor folks. And, of course, the Supreme Court in its ruling, which upheld the act in the main, found that the federal government could not require the states to accept this expansion, which was largely funded by federal funds, I believe, for the first several years. So a lot of states are declining to expand Medicaid. Where does that leave poor folks in those states?

POTTER: Well, first of all, about 24 states have indicated that they're going to be expanding coverage - and that includes some of the bigger states, New York and California and Illinois are among them. But some of the largest have also said that they are not planning to expand at least in 2014 - Texas and Florida among those states. There's some that still haven't decided. And people who are poor in those states; they're going to have to wait, unfortunately, because of political decisions that are being made. I think we will see though, that by 2015 - and maybe even in 2014 - some of these states will change their minds.

These are political decisions. There are a lot of members of state legislatures and governors who are just not willing to approve anything that is a part of Obamacare. It's become a very ideological issue in the states, as well as in Congress. But I think already, we're seeing that some of the states led by Republicans are understanding that this makes sense. Arizona and New Jersey are both states that have Republican governors, and in Arizona, it's pretty much a red state. But it will be expanding the Medicaid program because it's not just the right thing to do, but it makes economic sense. And here's why. When you have more people covered you're doing something about the cost shift that increases the cost of coverage for people who have private insurance.

People who don't have insurance, they still get sick and they still get injured, and most of them when they do, go to the emergency room. Hospitals can't often collect money from those folks because they don't have the money to pay for it. They can't turn them away. It's called uncompensated care, but that's a misnomer. Somebody has to pay for that care, and that somebody is you and me if we have private coverage. We're paying more for private coverage because of the so called uncompensated care. So it just makes sense to give more people coverage so that they're getting care in the most appropriate setting, not in the emergency rooms.

The other thing is that hospitals in those states will not be getting the same amount of money they have in the past. There's something called disproportionate share - money that comes from the federal government - to that helps a lot of hospitals stay open. Those hospitals have a disproportionate number of poor people or are in rural areas, that money is going to go away because of the intended expansion of Medicaid.

DAVIES: That's going to be away for everybody, you're saying.

POTTER: That's right.

DAVIES: For all of those hospitals.

POTTER: All of those hospitals.

DAVIES: So if you don't participate in expanded Medicaid then you will be left holding the bill.

POTTER: Exactly. And those hospitals in those states are going to be really suffering. And I think that you've seen a lot of hospitals already in those states trying to explain this to lawmakers. And I think when you start seeing some of these hospitals closing, shutting down, people losing their jobs as well as health care options going away, that the states will begin to reconsider.

DAVIES: You and I are having this conversation in the state of Pennsylvania, where Governor Tom Corbett has so far not accepted Medicaid expansion. And what he says is it looks like a great deal in the first couple of years, but the federal government has a history of unfunded mandates, of breaking promises, and his fear is that in a few years Pennsylvania taxpayers will be on the stick for a huge bill.

POTTER: Well, that's his point of view and every governor has a point of view. But in the Affordable Care Act, the federal government for the first few years will be paying 100 percent of the expansion of the Medicaid program, and never less than 90 percent. It will reduce overtime to 90 percent but it will not drop down below that. And you've seen the existing programs meet a great need for a lot of Americans. The Medicare program and the existing Medicaid program meets a great need. And in the existing Medicaid program, the federal government still pays a significant percentage of the coverage for poor individuals in a given state.

DAVIES: So let's talk about what happens if you're poor and you're in a state that has not accepted Medicaid expansion, your option then is to - after October 1st - go to one of these online marketplaces...

POTTER: Right.

DAVIES: ...the individual exchanges, and shop for insurance, right?

POTTER: That's correct.

DAVIES: And under what circumstances do you get help in the government and in what way?

POTTER: Well, unfortunately, for people in the states where the states will not be expanding the Medicaid program, they will be facing a dilemma. They will be able to buy coverage on the exchanges but the way the law is structured, it was the assumption that every state would expand. So the subsidies are available for those who are making incomes between 133 and 138 percent of the federal poverty level and 400 percent. So people who would otherwise be eligible for Medicaid are not, as the law is currently written, they won't be eligible for the subsidies. That is something that Congress and the states really need to focus on.

DAVIES: It was expected that the poor would have Medicaid...

POTTER: Right.

DAVIES: ...and those slightly better off still struggling with me subsidies. So the poor are really left out the pot.

POTTER: They really are. And that's another thing that's so dismaying about the states that are saying they're going to take a pass on expanding the Medicaid program, because the most vulnerable in those states are the ones that are going to be suffering the worst.

DAVIES: Now the logical thing to do would be for Congress to say wait a minute, we should offer at least the same subsidy for the poorest as those who are slightly better off.

POTTER: Right.

DAVIES: But this Congress - given the polarization and the partisan divide - not likely to do that.

POTTER: It's not likely to do that. I don't think that we're going to see much of anything out of Congress pertaining to health care reform in the foreseeable future. I think we got all that we could get in 2010, when the Affordable Care Act was passed. And the Republicans have, you know, what they have tried to do, in the House anyway, is to repeal the legislation. Democrats have been resisting that, for obvious reasons. Neither - the Democrats don't necessarily want to open up the act because of concerns that it could be weakened in other ways. So it's a dilemma. I don't know if the administration can do something without congressional action, or if the states can do something without the federal government, but it is something that is going to be a real gap and I think is another reason why the states ultimately will come around to expanding the Medicaid programs.

DAVIES: Our guest is Wendell Potter. He is a senior analyst at the Center for Public Integrity. He also writes a column for the Huffington Post and has a blog you can see@WendellPotter.com.

We'll talk more after a break. This is FRESH AIR.

(SOUNDBITE OF MUSIC)

DAVIES: This is FRESH AIR. And if you're just joining us, our guest is Wendell Potter. He spent many years as a public relations executive in the health insurance industry. He's now a senior analyst at the Center for Public Integrity. He also writes a blog @WendellPotter.com.

There is a critique of the logic of the Affordable Care Act, which predicts what some people call a death spiral for the insurance company. The logic is this: that for individual people who don't have policies, they'll look at their options and those say well, I can go to these exchanges, these marketplaces, and buy insurance, but it's kind of expensive. It's more expensive than me paying the penalty for not buying it, and now the insurance companies have to take me even if I'm sick. So I'll just decline coverage. I'll get insurance when I get sick, which means that the insurance companies won't have the benefit of the bigger risk pool of healthy people. They'll be treating a lot more sick people. That will be hard on them. It will drive up their cost. That will drive up premiums, which will make the healthy individuals even more unlikely to get insurance, and that the insurance companies enter into a death spiral. What about this?

POTTER: Well, that's the theory and I don't think it's one that will hold up. And here's why: most of the people that I have talked with who are uninsured don't want to be uninsured. They realize they're taking a big risk. And in most cases they are very frustrated that they can't buy coverage at any price because they've been turned down by insurance companies, and once you've been turned down by one, chances are you going to be turned down by everyone else that you apply to. So that's the thing I think will work against that theory. People want to get coverage and if they can see that they can get coverage, and if they are low to moderate income get a discount on that coverage, then I think that they will sign up.

There will be a significant marketing and educational effort - if you will - to explain to people what their options are and what their responsibilities are under this act. Sure, they're going to be some people who want to shirk their individual responsibility, just as there are some people who don't want to buy auto insurance. But most people, I think, will want to get insured. And I think that you'll see that both young people and older folks will want to get coverage, and that this death spiral that is speculated to happen really will not.

DAVIES: The Affordable Care Act had some provisions which were designed to reduce health care costs. Are they working?

POTTER: They are working, and I think that we will see that they will continue to work. One is the expansion of the Medicaid program in the states that are expanding it. One is to bring more people into coverage through the exchanges. The more people you get covered, the better able you are to remove cost from the system, because people who don't have coverage go to the emergency room, they get care in typically, the most expensive and least appropriate setting. When people have coverage, when they are in a plan, they will be able to go to a physician or to a hospital that is covered in their network or under their plan and not resort to having to wait until they are very, very sick to get coverage in the emergency room. So that is one way.

The other thing - among the other things that it is doing - it is getting hospitals and doctors and health care payers - that meaning employers and insurance companies - to work more collaboratively through accountable care organizations - as they are called - in the act, which is unique because we seem that competition really has not worked well. The so-called free market system hasn't worked at all as in health care as it has in other sectors of the economy. This provides some structure for there to be both competition and collaboration that will serve to bring costs down by making sure that care is focused on individual patients, and that those that are participating in the affordable care - excuse me in the accountable care organizations - are doing what they do best.

A hospital, for example, or a physician can have - and does have - better success trying to get a patient to adhere to a diet or to do something differently to modify their behaviors than an insurance company can, so why would an insurance company want to continue to do something that can be better done by a physician or hospital?

DAVIES: We're speaking in the summer of 2013. In October, we're going to have these online marketplaces, the exchanges to up online, and then January 1st, the individual mandate, those requirements will be in effect. What are you expecting to see over the next year? Your best guess.

POTTER: Over the next year, I think you will see that, first of all, not everybody is going to sign up for coverage on October the 1st, just like when we are signing up for open enrollment at a workplace, many of us will wait until closer to the end of that open enrollment period to sign up. But we'll see that people, over the course of time between October the 1st and January the 1st, people will become more and more familiar with it. They'll be signing up for it.

And I think that, well, on January the 1st, there will be plenty of people who will not have signed up. Some will find out that they have to pay a penalty. It's not going to be an onerous penalty. But I think you will see that most people who not insured will get insurance because they want to be insured.

The people I saw at that fairground in Wise County, Virginia, they were not there by choice. They would much prefer going to a doctor. They didn't like getting care in a barn or animal stall, and for obvious reasons. And I think that you will see that people will understand this makes sense. And if the benefits can be explained to them as benefits - what's in it for them - then we'll see the Affordable Care Act will work as intended.

And I think you'll see, over time, more and more people signing up for coverage in the years to come. I think you'll see the states that are not going to be expanding their Medicaid programs in 2014, they will in 2015 or down the road. I think it's going to work.

DAVIES: You said when you were an executive, you were in a different neighborhood, and you just didn't see the people out there struggling and in need. Now that you've been out of it a while, do you ever wonder that maybe you've been out of the industry, and you're not seeing their struggles, their challenges clearly? That there might be parts of their experience that you're not giving due credit to?

POTTER: Well, I do know that even though I haven't been there now for about five years, that they are having to adjust to a different world. There are new regulations they have to abide by. There are consumer protections that are going to be going into effect. So they're having to spend quite a bit of time and resources to get ready for some of these very important consumer protections. So their world is changing.

One thing that isn't changing for the big for-profits is pressure from Wall Street. One of my responsibilities was handling financial communications to the media. So I had to know how these companies made money. And I had to know what their obligations were to shareholders and to Wall Street financial analysts. That has not gone away. These companies operate quarter to quarter.

They have to demonstrate every three months that they're meeting shareholders' expectations or their stock is going to take a hit. So a lot hasn't changed in that regard, but they're also going to be having to abide by some new long overdue consumer protections.

DAVIES: Wendell Potter, thanks so much for speaking with us.

POTTER: Thank you, Dave.

DAVIES: Wendell Potter is a former health insurance public relations executive. He's now a senior analyst for the Center for Public Integrity and a contributor to the Huffington Post. His book about insurance industry communication strategies is called "Deadly Spin." Coming up, Ken Tucker reviews Jay-Z's new album "Magna Carta Holy Grail." This is FRESH AIR.

DAVE DAVIES, HOST: The rapper Jay-Z has just released a new album called "Magna Carta Holy Grail." He's now married to singer Beyonce, and this is his first collection since becoming a father. Rock critic Ken Tucker says the album is an uneven, but intriguing collection of songs that tries to navigate a path between parenthood and an obsession with commercial success.

(SOUNDBITE OF SONG, "HEAVEN")

JAY-Z: (Rapping) That's me in the corner. Uh. That's me in the spotlight. Uh. Losing my religion. Losing my religion. Getting ghost in the ghost. Can you see me? Can you see me? Have mercy on a Judas, angel wings on a 'ghini. Uh. Secular to the heckler, settle down. Yeah, religion creates division like my Maybach partition. And God is my chauffer. Boy they love Hova. From the south side of Chi to Brooklyn where I growed up.

(rapping) I confess God in the flesh, live among the serpents, turn arenas to churches. Uh. I'm like Michael. Recycle...

KEN TUCKER, BYLINE: Now 43 years old, Jay-Z has become the Jay Gatsby of hip-hop: a man with a checkered background, playing host to endless parties celebrating excellence, the good life and himself. It's no wonder he was asked to oversee the music for director Baz Luhrmann's amusement park ride version of F. Scott Fitzgerald's romantic fantasy.

Jay-Z has been popping champagne corks to his own moneymaking abilities for so long now, with Beyonce by his side as a more attainable Daisy, that we're all reduced to being Nick Carraways, looking at him with a mixture of bafflement and envy. It's a mixture Jay-Z seeks to further on his new album "Magna Carta Holy Grail," a gaudy puzzler that's both triumphant and trivial.

(SOUNDBITE OF SONG, "SOMEWHEREINAMERICA")

JAY-Z: (Rapping) Uh. Hey. See what you made me do?

(Rapping) Ow. Hey. Shout out to old Jews and old rules. Uh. New blacks with new stacks. Uh. I already been the king. Uh. Retro act, I'm just bringing it back like Jordan Packs. Uh. New money, they looking down on me. Uh. Blue bloods, they trying to clown on me. Uh. You can turn up your nose, high society. Uh. Never going to turn down a homie. Uh.

(rapping) Knock, knock. I'm at your neighbor house. Uh. Straight cash I bought your neighbor out. Uh. You should come to the house warming. Uh. Come and see what your new neighbor about. Uh.

TUCKER: That's "Somewhereinamerica," on which Jay-Z goes over the familiar ground of the nouveau riche versus old money. Lots of black rappers chafe in their lyrics over the disdain they sense from moneyed white culture, and Jay-Z doesn't add much to this genre of resentment. The best thing about this variation on the theme is the coproduction by the hip-hop artist Hit Boy, which gives a bouncy oomph to the sluggish complaints.

Its trombone-brass sound effect works as a musical criticism, giving a raspberry to Jay-Z's litany. His more amusing rich man's playthings catalogue, a composition called "Picasso Baby," finds him rhyming the Miami festival Art Basel with life colossal. He praises Jeff Koons' balloons and pronounces himself rather more weirdly the new Jean-Michel Basquiat.

(SOUNDBITE OF SONG, 'PICASSO BABY')

JAY-Z: (Rapping) Oh, what a feeling. Picasso, baby. Picasso, baby. Picasso, baby. Ca-ca-Picasso. It ain't hard to tell I'm the new Jean-Michel, surrounded by Warhols, my whole team ball. Twin Bugattis outside the Art Basel. I just want to live life colossal. Leonardo da Vinci flow, Riccardo Tisci Givenchy clothes. See me throning at the Met, vogueing on these (beep), champagne on my breath. Yes.

(Rapping) House like the Louvre or the Tate Modern, 'cause I be going ape at the auction. Oh, what a feeling.

TUCKER: Despite guest cameos by Justin Timberlake and Frank Ocean, there's a lassitude to much of "Magna Carta." Can it possibly be ascribed to the banality of real life? Much of this album's rhyming sounds tossed off, distracted. Is this the work of a scattered, tired new dad? That doesn't square with the high-living, self-described billionaire who's difficult to imagine losing sleep walking a squawking baby Blue Ivy around in the middle of the night, or changing a diaper, although he does use Pampers as an unfortunate rhyme word with Hamptons.

On the song "Jay-Z Blue" he samples a bit of Faye Dunaway dialogue from the movie "Mommy Dearest." But not to worry: He's not implying that the mother of his child, Beyonce, is swinging wire hangers around the crib. On other songs, he compares Beyonce to the Mona Lisa, and also builds a hymn to and around her, inviting his wife to join in.

(SOUNDBITE OF SONG, "PART II (ON THE RUN)")

BEYONCE: (Singing) I hear sirens while we make love. Loud as hell, but they don't know. They're nowhere near us. I will hold your heart and your gun. I don't care if they come. No. I know it's crazy, but they can take me now that I found the places that you take me. Without you, I've got nothing to lose.

JAY-Z: (Rapping) I'm an outlaw. Got an outlaw chick. Bumping 2Pac on my outlaw (beep). Matching tats, this ink don't come off, even if rings come off, if things ring off. My nails get dirty. My past ain't pretty. My lady is. My Mercedes is.

TUCKER: "Magna Carta Holy Grail" arrives on the heels of Kanye West's album "Yeezus," a far more abrasive production that found Jay-Z's one-time protege proclaiming himself a god and grinding the Billie Holliday classic "Strange Fruit" into a pulp. Jay-Z also compares himself to the deity and invokes "Strange Fruit," but in a shrewder context.

In the song "Oceans," he locates the irony of cruising the high seas in a fancy boat while being haunted by the notion that these may be the same waters that transported slaves to America. No one is asking Jay-Z to become a morose historian, but as he's proved in the past, he's frequently at his best when he's not merely self-aware, but aware of a world that existed before his arrival - beyond money, yachts, jewelry and boasting.

DAVIES: Ken Tucker reviewed "Magna Carta Holy Grail," the new album from Jay-Z. You can download podcasts of our show at freshair.npr.org. Follow us on Twitter @nprfreshair, and on Tumblr at nprfreshair.tumblr.com.

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