Andy Slavitt’s United States of Care: A Second “Undertaking” (and What We Can Expect From It)

By Lambert Strether of Corrente.

“A company for carrying on an undertaking of great advantage, but nobody to know what it is.” –Prospectus for a joint stock company in the South Sea Bubble (1720)

Yesterday, we looked at how Andy Slavitt’s United States of Care (henceforth @UsofCare) was launched, whether we should be wary of it (undisclosed donors; board of perps establishment figures), and whether it opposes #MedicareForAll (yes, when you peel away the bafflegab). We took an especially close look at Slavitt tapdancing his way through taking a position on #MedicareForAll, quoting him at tedious, though not excessive length. (Not excessive, because a cuttlefish-like volumeretriciousness of speech seems to be one of Slavitt’s essential characteristics as an interlocutor[1]. If you skipped over the Slavitt parts yesterday — they were formatted like this — I urge you to go back and read them before continuing; they are breathtaking in their effrontery.) Today, and at much less length, I’ll propose that the three requirements I outlined for the Bezos, Buffett and Dimon undertaking will also apply to any solution emanating from @USofCare[2]. To review, these three requirements are:

  1. Accounting control fraud
  2. Financial predation
  3. Abused workforce

And to those three I will add a fourth:

  1. Conflict of interest

Of course, I’m not saying that Slavitt and his 50 “Directors and Founders” sat down and agreed a list of criminal acts; that’s not how these things are done, and in any case, absent evidence from a whistleblower or a fly on the wall, it’s hard to see how anyone could prove that. What I can do is show the track records of the players; since the system is working very well for them, they are unlikely to change their behavior under any scheme proposed by @USofCare. I will also assert that the level of corruption under neoliberalism[3] is such that any solution proposed within that conceptual framework — rather, by elite players operating within that framework — will exhibit these features. We’ll look at each feature in turn. (For expository reasons, I will put “Conflicts of Interest” before “Abused Workforce.”) But before we do that, here’s a potted history of Slavitt’s career. I’ve underlined the firms to watch:

Before building and selling his healthcare company ‘Health Allies’ to UnitedHealth in 2003, Slavitt was an investment banker for Goldman Sachs and also worked as a consultant with McKinsey and Company, a private healthcare lobbying firm. Slavitt quickly rose through the ranks at UnitedHealth, eventually becoming head of Optum Insight (née Ingenix) – the company’s technology arm. By the time the opportunity in new government infrastructure came up, UnitedHealth had the technology, expertise and leaders to scale up.

That “new government infrastructure” was, of course, the ACA. The Hill takes up the story:

Prior to his appointments to CMS and current nomination… Slavitt was CEO of Optum/QSSI, a subsidiary of UnitedHealth Group, one of the nation’s largest health insurers. Optum/QSSI had been building the data services hub for the online marketplace under an $85 million contract before it was chosen to serve as the systems integrator in late October 2013, just weeks after the website famously imploded.

And finally from the Minneapolis Tribune:

He also served in one of the top health care posts under former President Barack Obama. He’s probably best known as the wonk brought in to fix after the website’s disastrous launch.

You got that right: The ObamaCare website imploded after being built by QSSI, run by Slavitt. Slavitt then slithered over to HHS/CMS and has now acquired the reputation, at least in his home state, Minnesota, for fixing the broken system his own company built[4]. That’s a world-class Flexian in action! (I’m mindful of alert reader MedicalQuack’s comment that “I’ve written about this snake in detail for years.” I think a timeline of Slavitt’s career would be very useful point of entry to the big picture on health care, and perhaps at some point we’ll create one.)

1. Accounting Control Fraud

Here is a classic scheme from United HealthCare. Slavitt was a senior executive with United Healthcare from 2003 to 2013, during which time the fraud occurred:

United Healthcare Services Inc., which runs the nation’s largest private Medicare Advantage insurance plan, concealed hundreds of complaints of enrollment fraud and other misconduct from federal officials as part of a scheme to collect bonus payments it didn’t deserve, a newly unsealed whistleblower lawsuit alleges.

The suit, filed by United Healthcare sales agents in Wisconsin, accuses the giant insurer of keeping a “dual set of books” to hide serious complaints about its services and of being “intentionally ineffective” at investigating misconduct by its sales staff. A federal judge unsealed the lawsuit, first filed in October 2016, on Tuesday.

The company knew of accusations that at least one sales agent forged signatures on enrollment forms and had been the subject of dozens of other misconduct complaints, according to the suit. In another case, a sales agent allegedly engaged in a “brazen kickback scheme” in which she promised iPads to people who agreed to sign up and stay with the health plan for six months, according to the suit.

Sounds like United HealthCare and Wells Fargo have a lot in common, unsurprisingly.

2. Financial Predation

Here is a classic database scheme from Ingenix, where Slavitt was CEO. It was so bad that even Andrew Cuomo noticed, back when he was New York state’s Attorney General. SourceWatch:

On February 13, 2008, New York State Attorney General Andrew Cuomo announced the state was expanding an investigation that focused on Ingenix. After an initial six-month investigation, the AG filed lawsuit against Ingenix. At a briefing held on February 13, Cuomo stated, “This involves fraud in the hundreds of millions of dollars, affecting thousands and thousands of families … Too many people have been hurt. It has to stop. We believe there was an industry wide scheme perpetrated by some of the nation’s largest health insurance companies to defraud consumers.”

In describing the alleged fraud committed by Ingenix, Mr. Cuomo described a typical scenario, where an out-of-network doctor might charge $200 for an office visit but is told that the going rate is $77. The insurer would then normally pay only 80% of that figure, leaving the patient responsible for the difference of about $138. At the heart of the state’s lawsuit was how that $77 rate got set in the first place: the number was derived from a database of claims data created and maintained by Ingenix, and sold to other insurers.

In responding to the Attorney General’s allegations, UnitedHealth said it believed it was delivering “dependable database tools.” Moreover, the company claimed that “the reference data is rigorously developed, geographically specific, comprehensive and organized using a transparent methodology that is very common in the health care industry.” However, Linda Lacewell, who headed AG Cuomo’s healthcare industry taskforce, accused UnitedHealth of lying to consumers. She described the Ingenix database as “garbage in, garbage out.” Another source reported Ms. Lacewell’s description of Ingenix and UnitedHealth’s use of data as “deception, manipulation of data and outright fraud.”[4]

So Slavitt is just the kind of guy we want involved in, er, “fixing” the ObamaCare marketplace, eh?

3. Conflict of Interest

Robert Eskow writes in Alternet:

Progressives Beware: The United States of Care Is Not What It Seems

Slavitt has reportedly created an investment fund (more here) that hopes to make money from “low-income, high need populations” – that is, people who depend on the government for their health care. That’s a pretty fundamental conflict of interest.

Zephyr Teachout, with the Founders, defines corruption as “self-serving use of public power for private ends.” If you regard @USofHealthCare as, at least putatively, as an example of public services, then using that same effort for your own profit is corruption.[5] It’s also not hard to see how somebody with a good RoloDex of government health care administrators could get work thrown to firms which the investment fund has backed.

4. Abused Workforce

Here, I speculate, but let’s look Slavitt’s (deeply conflicted) investment strategy. He highlights two companies:

Medicaid patients are [ConsejoSano’s] main area of interest, particularly those who have difficulty navigating the American health system. It provides a text message services in Spanish, Arabic, Cantonese, Mandarin and other languages that include alerts about upcoming appointments and tasks they need to do that are culturally appropriate. He also made note of Circulation Health, a non emergency transportation company to get patients to medical appointments medications to customers.

(Note that in each case the investment is not made in health care, but in firms that ensure, er, “access” to care, via text messaging and transport respectively.) And he explains the firms that are models for his picks:)

Slavitt pointed out that the common theme these companies have is that they provide much-needed services behind their technologies.

“There is room for cool innovation.

Uh oh…

What is Air BnB doing? What do all these companies do? They logistically give people more opportunities — these are companies that are about improving people’s lives. Is Uber a tech company? Is Air BnB a tech company? In a matter of speaking, yes, they are but it is really about identifying services to make people’s lives better.”

So AirBnB and Uber are Slavitt’s models? Good to know, especially since the essential “innovation” of both companies was in regulatory arbitrage (or, in the vulgate, “breaking the law,” AirBnB by letting property owners run unregulated hotels, Uber in, like, everything, top to bottom). Both Uber and AirBnB abuse workers, Uber through its horrid “gig economy” practices, AirBnB by undercutting the legitimate hotel business and hence that industry’s workers, who are often poor, often of color, often immigrants, and often unionized. (Strange to see a liberal Democrat like Slavitt supporting all this [hollow laughter]). Will abuse of workers happen at the firms Slavitt will invest in? Impossible to say for sure, but “Circulation Health” has “just like Uber” written all over it, and ConsejoSano sounds like a glorified call center.[6] And not that I’m paranoid, but I bet liberal Democrats would love to see #MedicalForAll advocates like National Nurses United taken out. Perhaps it’s time to “disrupt” the nursing profession!


We’ll have to see what policy proposals @USofCare comes out with as Slavitt’s undertakers “change the conversation.” Slavitt’s track record is not, to say the least, re-assuring. I’m sure we’ll be hearing more — much, much more — from him, especially as each one of his “cool innovations” inserts its profit-sucking mandibles into the bloated and prostrate body politic we laughingly call our “health care” “system.”


[1] I first encountered Slavitt on the Twitter, as a hash tag activist on #SaveTheACA (but never, ever mention #MedicareForAll). Twitter’s character limit really worked in Slavitt’s favor.

[2] I use the strong form “requirements” to make the point that, for corrupt elites, characteristics like accounting control fraud are features, not bugs.

[3] Clive writes: “Increasingly, if you want to get and hang on to a middle class job, that job will involve dishonesty or exploitation of others in some way. Industries such as finance have seized and held onto larger and larger proportions of the economy.” We have, after all, an entire “industry” (if you want to call selling insurance an industry) with thousands of people in cubes working for firms that profit by denying people health care.

[4] Most of the credit should not go to administrators like Slavitt — “wonk,” forsooth; Reuters calls him a “hero” — but to the engineers and systems architects, many associated with the Obama campaign, who went on to inititiate the United States Digital Service. This story was written up by Steven Brill for Time in 2014. The story is now paywalled — available here in PDF form — and doesn’t seem to exist anywhere else, a fine example of history being erased, even history less than a decade old.

[5] Although a Flexian, presented with Teachout’s definition, would probably just stare blankly.

[6] To be fair, Slavitt’s new firm could just be a cynical attempt to cut a slice of all the stupid money sloshing around Silicon Valley. Not that there’s anything wrong with that.

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. Arizona Slim

    The United States Digital Service? Don’t get me started!

    Okay, I’m started. I submitted more than one application to that outfit, and got nowhere. And it wasn’t like I wasn’t qualified to be of service.

    Grrrrr ….

    1. June Goodwin

      The nurses !j they will want to take out our heroic nurses!!!?

      “And not that I’m paranoid, but I bet liberal Democrats would love to see #MedicalForAll advocates like National Nurses United taken out. Perhaps it’s time to “disrupt” the nursing profession!”

      Corporatists/neoliberal/Establishment Dems seem endlessly mean, nasty and as selfish as Trump.

      Look what they did to Kimberly Ellis in California – what, pray tell, did they exactly do to Ellis who was heavily involved in trying to get Medicare for All? Does anyone know?

      Thank you Lambert for this analysis.

  2. Henry Moon Pie

    [3] Clive writes: “Increasingly, if you want to get and hang on to a middle class job, that job will involve dishonesty or exploitation of others in some way. Industries such as finance have seized and held onto larger and larger proportions of the economy.” We have, after all, an entire “industry” (if you want to call selling insurance an industry) with thousands of people in cubes working for firms that profit by denying people health care.

    That paragraph points out a devastating truth: it’s not just America’s elite that’s corrupt; dishonesty and exploitation of others is widespread. While it may be true that corruption gets worse the higher you go in our social structure, really changing direction is going to require a lot more than deposing our current elite.

    1. redleg

      Don’t be too critics of the cube workers. I’ll bet that most of them are happy to have work and wouldn’t leave that sh!tty job because (wait for it) they need health insurance.

      1. jrs

        or … because they need the job period, health insurance or no (and *some* of the cube workers may not actually have health insurance anyway – as they are contract workers but still they go to work for that paycheck.)

      2. Henry Moon Pie

        That is the standard reply when anyone criticizes those who collaborate in humanity’s dehumanization. The reality is a lot more complicated than a choice between surviving and refusing to be a contributor to the ongoing calamity. If you take a promotion for the sake of higher pay with the knowledge that it will require you to engage in even more dishonesty and exploitation, are you blameless? If you remain in a job where you contribute to the injuring of others rather than searching for alternative means of survival or reducing your need for money, are you blameless?

        Ceding all accountability to the elites turns us into mere spectators on this planet.

          1. Henry Moon Pie

            Quite the opposite. I started out broke and remain broke today. I learned how to be both broke and happy.

        1. jrs

          some people have options, some people don’t, and everyone’s options are limited. One doesn’t necessarily have options because they are middle class as even if they are frugal, savings run out when one doesn’t work for a long time, simple as that. It’s easy to say “don’t take the promotion” assuming it’s only about money, however many careers are get promoted our get out and they have no other career path past one’s early youth. It’s one thing to search for another means of survival and another to find it, everyone who searches for a new job doesn’t always find it, and even when they do someone will be desperate enough to do their old job.

    2. jrs

      What on earth does middle class job really have to do with it though? If you are upselling people Micky D’s hamburgers or Pizza Hut pizzas it does it fair share of damage right? In heart attacks, diabetes, etc.. But noone thinks that is middle class. Most industries are at least moderately harmful but most of us must work in them anyway pretty much.

  3. audrey jr

    A beautiful piece of work is this, Lambert. Thanks so much for your close attention to this particular grift. I almost spewed my water on the screen when I read the “..even Andrew Cuomo noticed…” part.

  4. Tomonthebeach

    It sure seems that Goldman Sachs has a thumbprint on nearly every high-profile pol in the country.

    It makes one wonder if megalomaniacs are attracted to work there or if once on the payroll, you go through some sort of voodoo brainwashing that makes you zombie neolib who can only survive by sucking the financial life out of everyone else.

  5. plato_in_the_cave

    I would argue the normalization of corruption has been standard operating procedure for quite some time now. Replace democracy with kleptocracy and what do you get?….the modern American society we currently live in. Don’t believe me? Opt-into any institutional service (legal, healthcare, finance, insurance, education, real estate, media, the Internet, government, military, church, any organization that has an impact on your life and those you care about), find person(s), practices or policies where ethics are questionable. Request improvements, corrections, greater transparencies to those questionable behaviors, and see how far you get beyond the mind-numbing offshore call center rep who’ll begin the conversation by lying to you by giving you a false first name and then provide you with non-answers designed to give you the illusion that you matter when all they’re really telling you is that all they care about is your potential as a debtor (i.e. wealth extraction…and for those even less aware…your money).

    1. Jen

      With only one little vowel change you would be closer to the point, although adding an “er” at the end is traditional…

  6. The Rev Kev

    Oh I hope that the United States of Care does not adopt a bear as its mascot. The pun would be too terrible to contemplate! I would like to add a thought to this topic, that may or may not be valid, to put the whole health care debate into context. It was something that Yves herself mentioned the other day in a conversation with a friend that put me onto this thought. What if it was considered that the US already had the best health care system in the world?
    Before I get piled on here, I have to say that this would be the viewpoint of the top, what, 10-20% of the population. After all, America has some of the best doctors and surgeons in the world. It is at the forefront of medical technology from what I can see. It has world famous hospitals and medical schools there. I understand that lots of people even fly to America to have specialist surgery done. If there is a need for a surgical specialty, I have seen people here in Australia fly over to the US to have it done.
    If you had big money behind you, you would have a choice of all these top doctors and surgeons which from your viewpoint would be a great outcome. Certainly John McCain, as an example, has availed himself to all this top medical care. Remember, this is your life and well-being on the line here. Probably, the US has some of the best veterinarians in the world too for these people’s pets for that matter. Do you really see these people being willing to totally upturn the whole healthcare system in the US for people that can’t even afford it? And perhaps, if ever so slightly, put their own health care system at risk?

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