Humana Corporation's Growth in Private Enterprise and Welfare Care

Humana Inc.was founded in 1961 in Louisville,2000 Memorial Sisters of Charity Texas
Kentucky. The company was founded by David2003 Oschner Health Plan Louisiana
Jones and Wendell Cherry as a nursing home2005 CarePlus Health Florida
company. Both men decided to start the business2005 Corphealth Behavioral Healthcare Texas
whilst engaged in playing a game of golf in2006 CHA Health Kentucky
Louisville. Each of them put up $1,000 as their2007 Compbenefits Georgia
initial investment. The company soon became the2007 KMG Minnesota
largest nursing home company in the UnitedOver 46 years since its foundation by those two
States. Learning that more profits could be madegolf players, Humana is now the Official Health
in running hospitals they divested from the nursingBenefits Provider of the PGA Tour and
home chain and moved into purchasing hospitals inChampions Tour. PGA Tour player David Toms
197. Humana in time became the world's largestand LPGA player Nancy Scranton are both
hospital company in the 1980s.ambassadors for Humana. With a customer base
To reflect the company's new direction, the nameof over 11.5 million in the United States the
was changed from Extendicare to Humana Inc. incompany is now the largest Fortune 500
1974. Humana experienced tremendous growthCompany. Headquartered in Louisville in the
organically.in the years that followed. Its takeoverCommonwealth of Kentucky, it has generated a
of American Medicorp Inc. in 1978 doubled themarket capital of over $10 billion and $21.4 billion
company's size. During the mid-1970s, a fast-trackdollars in revenue. Humana employs over 22,500
construction process enabled the completion and"associates" nationwide. It markets its health
opening of one hospital a month. This acceleratedbenefit consumer services all over the US and has
construction schedule compressed time byinternational business interests in Western Europe.
overlapping processes thus allowing Humana toIn its March 2007 issue, Fortune Magazine named
develop hospital projects incredibly faster. HumanaHumana one of the Top 5 Most Admired
then moved into developing the double corridorHealthcare Companies in the United States.
model for hospital construction which minimizedThe picture of Humana making business out of
the distance between patients and nurses byhealth care and medicine has not been all rosy.
placing nursing support services in the interior ofThere have been widespread opposition to this
the building with patient rooms surrounding thecommercialisation of what they think should be a
perimeter.social service as unethical. This has even often
As the American health care system evolved indegenerated into legal tussles.
the 1980s, Humana developed an integratedIn 1987, Humana sued NBC over a story line in
health care delivery system by creating a familythe television medical drama St. Elsewhere where
of flexible health care plans, tying up the healththe hospital was to be sold to a for-profit medical
care service with a health insurance plan thuscorporation and renamed "Ecumena", with
enabling them to begin marketing health insurancesubsequent changes to the hospital, both positive
in 1984. .and negative, emanating from that change.
Humana brought the pioneering artificial heartHumana forced NBC into showing a disclaimer at
research of Dr. Robert Jarvik and Dr. Williamthe beginning of the September 30 episode saying
DeVries to Louisville under the newly-createdthat the drama had no connection whatsoever
Humana Heart Institute in 1985. Just in 1982 Clark,with Humana. A news report on that states:
a 61-year-old retired dentist from Des Moines,A federal court in Paducah, Ky... ruled that NBC
Washington., became the first human to receive aissue a disclaimer before last night's episode of
permanently implanted artificial heart at the hands"St. Elsewhere" explaining that the hospital drama
of surgeon William DeVries. For DeVries, then 38,has no relationship with Humana Inc., the for-profit
that satisfying moment was the culmination ofhospital chain noted for its work on the artificial
the three years he had spent perfecting theheart.
technique that made the implant possible, andAccording to this season's story line, fictional St.
waiting for a patient who met the rigorous criteriaElsewhere has been sold to a for-profit medical
established for implant candidates by the Foodcorporation that has renamed the hospital
and Drug Administration. For DeVries the"Ecumena." The new owners have made
7½-hr. operation was "almost a spiritualimprovements to the shabby inner-city Boston
experience. So acquiring such a man together withhospital, but the corporation is also not as
his collaborator was to bring much invention andcompassionate toward the poor and uninsured as
life prolongation at the center of Humana....
In the 1990s Humana metamorphosed into aOn May 30, 1996, Linda Peeno, who was a
consumer health benefits company. Humanacontract worker for Humana for nine months,
spun-off its hospital operations from the healthtestified before Congress as to the demerits of
insurance operations in 1993 and created the newmanaged care.
company Galen Health Care Inc. Soon after, GalenShe began by making a public confession:
merged with Columbia/HCA. After UnitedIn the spring of 1987, as a physician, I caused the
Healthcare's failed attempt to acquire Humana indeath of a man. Although this was known to
1998, Humana began pioneering work in consumermany people, I have not been taken before any
driven health care in 1999; launching its firstcourt of law or called to account for this in any
services on September 11, 2001.The marketingprofessional or public forum. In fact, just the
and administering of health benefit consumeropposite occurred: I was "rewarded" for this. It
services. has become a very profitable area ofbought me an improved reputation in my job, and
Humana's engagement which is run principally fromcontributed to my advancement afterwards. Not
its headquarters at the Humana building.only did I demonstrate I could indeed do what
Through a partnership with Navigy, Inc., awas expected of me, I exemplified the "good"
subsidiary of Blue Cross and Blue Shield of Florida,company doctor: I saved a half million dollars.
Inc., in 2001, Humana launched Availity toI contend that "managed care," as we currently
empower physicians and other health careknow it, is inherently unethical in its organization
professionals with a business solution to conductand operation. Furthermore, I maintain that we
their daily health plan transactions.have an industry which can exist only through
Humana began marketing health savings accountflagrant ethical violations against individuals and the
services to individuals and companies in 2003. Thepublic.
Business Health Care Group of SoutheastOn the June 21, 2007 episode of Amy Goodman's
Wisconsin chose Humana as its administrativeDemocracy Now! radio/television program, Peeno
partner to drive Southeastern Wisconsin healthfurther claimed that "just within a day or so of
care costs to the Midwest average in 2005,the refusal of the heart transplant, I saw a
through consumer education largely, providing costsculpture being installed in the rotunda of
and quality information on health care providers,Humana's headquarters and was told ... that it had
structuring accountability of all stakeholders andcost about the same as the heart transplant that
collective purchasing. Today, this Group representswe had denied... I later found out that that
more than 200 member companies, including largesculpture cost $3.8 million, ... equivalent to eight
and small employers representing more thanheart transplants."
150,000 health care consumers in SoutheasternA video of Linda Peeno's testimony appeared in
Wisconsin.Michael Moore's 2007 documentary Sicko. In a
Upon passage of the Medicare Prescription Drug,statement about the movie, Humana declared
Improvement, and Modernization Act in the U. S.that Peeno was never a Humana associate, but
Congress, Humana launched an aggressiverather a "part-time contractor". Humana also
education campaign to market Medicaredisputed the portions of Congressional testimony
Advantage and Prescription Drug Plans nationwidethat were shown by saying that because the
to Medicare eligible consumers in 2006. Through apatient's specific healthcare plan didn't cover heart
cross country RV tour and strategic alliance withtransplants, the denial of coverage was valid.
medicare distribution concerns such as Wal-Mart,Humana was also featured in Season One of
approximately 5 million consumers got signedMoore's The Awful Truth, shown refusing to give
catapulting Humana to #2 in industry marketa pancreatic failure sufferer authorization for a
share for senior products. Humana also launchedtransplant due to a contradictory policy that
Right Source, a national mail-order retail pharmacystated that all of this man's diabetes related
business in 2006.expenses were covered by his plan (his pancreas
The list below shows some of the majorwas failing due to his diabetes) but in another
acquisitions by Humana since 1990 in the U.S.A::section, it said that it wouldn't cover organ
1990 Michael Reese Health Plan Illinoistransplants. Moore conducted a fake funeral on
1995 The Dental Concern Illinoisthe front steps of Humana for the man who was
1995 Carrington Illinoissure to die without the transplant. Three days
1996 Employers Health Insurance (EHI) Wisconsinlater, Humana changed their policy and authorized
1997 Physicians Corp of America (PCA) Texasthe man's treatment. This scene was the
1997 ChoiceCare Ohioinspiration for Sicko.