An Insurance Bureaucrat Speaks Out

Dr. Don Thieman’s been inside the health insurance industry and he’s not remaining silent

I sat down with Dr. Don Thieman at the studios at KBOO community radio. A longer version of this interview will be heard on the air at 90.7 FM in Portland on December 14 at 11:30 and later on the Web at

UPDATE: To hear the KBOO interview Click Here >>

Dr. Don Thieman is a former medical director for Regence BlueCross BlueShield of Oregon. Thieman served as a physician for more than 16 years before working for Regence. He now works as a medical director for CareOregon, the state’s largest administrator of the Oregon Health Plan.
REPORTER: In a recent commentary posted at, Dr. Thieman, “you write that you’ve been inside our health industry and have seen what happens when big money is involved, and public policy is crucial to future profits.” You go on to write, “I can honestly tell you that the resources spent on influencing the public are enormous, and the information is inevitably biased to the interests of its source.”
What do you mean by that?
THIEMAN: I’m referring to the industry efforts to influence public opinion over whether healthcare reform is needed or what kind of healthcare reform is needed. It has to do with the effort to scare the public, that any form of government influenced option for insurance will somehow ruin their healthcare and lead to government bureaucrats dictating care between them and their doctors.
REPORTER: You’re referring to the issue of the public health plan option administered by the government.
THIEMAN: That’s right, and specifically about a document from America’s Health Insurance Plans years ago about the attempt to deliberately generate fear among the public about any sort of government-run insurance option.
REPORTER: Given what we know today that the bills pending before congress would only include about 6 million Americans in the public option and most Americans won’t have the option to buy into this so-called public option, how does that put the industry's claims in light?
THIEMAN: Certainly there’s not much to fear if so few people are going to have access to a public option and I would say those people don’t have any thing to fear either. Someone recently said they would rather have their care run by a government bureaucrat than an insurance industry bureaucrat. I am an insurance bureaucrat and one who tries to do it right. When I look at the big picture I agree with the person who said that. I think the people who are in healthcare in our government by and large have our interest at heart much more than people in the insurance industry by and large. 
REPORTER: When you say you were an insurance industry bureaucrat, you really at the forefront of what is denied or approved for coverage at Regence Bluecross Blueshield of Oregon. Can you give us an insight into that process and how those decisions are made?
THIEMAN: Yes. The medical decisions are actually quite rigorous and there’s a lot of effort to make them based on science and the best information we have as to what works in health care and what does not. Although I know that function is not always done well by all companies, my own experience is that’s not where the biggest problems are. The biggest problems that lead to people not getting care they need is by people not having insurance at all or having insurance with such high deductibles and other out of pocket expenses that they can’t afford the insurance. If they can’t afford the deductible in some ways it doesn’t matter. They might as well not have insurance.
REPORTER: You said you felt that denying care for those with insurance isn’t as large an issue in your mind. That runs contrary to people pushing for healthcare reform. One of their demands is that insurance companies stop denying necessary care. Is this a misnomer?
THIEMAN: I think it’s an exaggerated fear. A lot of that is based on people not trusting insurance industry people like me. They don’t’ instinctively trust we’re actually trying to administer their benefits correctly. In fact most of us are.
REPORTER: Talk about Regence, the largest insurer in the state with close to a million members, why can’t they control costs?
THIEMAN: It’s interesting to know just how big does a company have to be to have influence on prices. Over the last 10 to 15 years as insurance companies have gotten bigger so have doctors and hospitals. They have not wanted to be dominated in certain areas so they’ve grouped up. Larger medical groups have formed so in many communities most or all of the orthopedic surgeons will be in one group. In Portland we have three hospitals that dominate the market. So competition for price isn’t that effective. So that has made it difficult. Another example is the issue of pharmacy. Regence has done a lot of work to try and control drug costs. That work got a lot more effective when the pharmacy benefit function was unified across all four state os that there were almost 4 million members at one time. That was enough lives to begin to have some influence on the drug companies. But before that when you’re only talking about a measly 1 million members in Oregon there was a lot less ability to get pricing from the drug industry. It’s really a huge market with some very big players making money so it’s not that easy to control it.
REPORTER: I can hear a lot of people saying single payer is the answer to that because it’s the only way to control the market completely. Do you have any hope for the bills in Congress?
THIEMAN: I do have hope that we’ll get a law this year that will make a significant step in the direction of a lot more people have access to care and the cost beginning to be controlled. We will not get anywhere near all the way there but I’m somewhat optimistic that we’ll get a very useful law that will help us make progress.
REPORTER: I wanted to close by asking you, as an insider to this industry, it’s not often that journalists and others get to hear from people like you. Can you talk about your motivation for speaking to us?
THIEMAN: Well, the opinions I’m expressing aren’t new and I’ve expressed them before. The things that caused me to write the first article for TheLundReport, was the feeling that if people like me don’t’ speak up and allow folks to see a little bit of what’ inside the healthcare industry than we’re not doing what we should do as a citizen. People may recall I quoted Wendell Potter form his Bill Moyer’s interview who quoted Dante who said that the hottest places in hell are reserved for people who during a moral crisis maintain neutrality. That struck me that as Wendell Potter did, stand up and be counted, I needed to do the same.   
For Thieman’s previous commentaries click here and here.


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