During months of deliberations, Commissioner Julie Benafield Bowman met repeatedly with United Healthcare lawyers and lobbyists over lunch and drinks at venues such as the Country Club of Little Rock.
“I had a blast with you Monday night,” Benafield emailed United Healthcare lawyer Bill Woodyard, himself a former state insurance commissioner. “Thank you so much for entertaining us.”
Commissioner Benafield ultimately decided the case in United Healthcare’s favor — a 2008 ruling that stood to save the company millions of dollars. Nearly two years later, by the time a judge vacated the commissioner’s orders because there was “an appearance of impropriety in the proceedings,” Benafield had moved on: She was working for United Healthcare, having joined at least three of her predecessors representing insurers in Arkansas.
It’s a common career move. An investigation by the Center for Public Integrity found that half of the 109 insurance commissioners who have left their posts in the last decade have gone on to work for the industry they used to regulate — many leaving before their terms expire. Just two moved into consumer advocacy.
When the Arkansas insurance commissioner weighed the merits of a hospital’s billing complaint against United Healthcare, her interactions with one of the nation’s largest health insurers extended far beyond her department’s hearing room.The revolving door swings in the other direction, too. For almost a year, Connecticut’s insurance commissioner was overseeing a merger involving a company where she had been a lobbyist. She recused herself last month amid a state ethics review.
Consumer advocates and some commissioners say the tight bond between regulators and industry — reinforced by campaign contributions, lavish dinners and the prospect of future employment — diminishes consumers’ voices as insurers press rate increases, shape regulations and scuttle investigations.
"It's very difficult at times to take a stand for consumers and have your voice heard," said Sally McCarty, a former Indiana commissioner and retired consumer advocate. "A lot of commissioners don't bother doing that for that reason — and they don't want to alienate the industry. ...Many people consider the job an audition for a better-paying job."
Insurers counter that the industry is highly regulated and their lobbying efforts are key to informing commissioners and other policymakers who oversee a part of the financial sector that touches millions of Americans’ lives.
“It is crucial for commissioners and other state and federal policymakers to understand the products and services we provide to people,” said Jack Dolan, a spokesman for the American Council of Life Insurers. “The information we provide and the perspectives we share must always be credible, trustworthy and follow the letter and spirit of the law.”
The stakes are enormous.
