By David Connell

T.S. Eliot declared April to be the cruelest month in his landmark poem The Wasteland. Perhaps Eliot was right, but March seems to be the busiest month, at least for insurance news. There was a raft of stories covering the industry in the nation's newspapers last month, and all hit hot-button topics ranging from health-care reform, to race, to terrorism and war. In the face of all this doom and gloom, we'll also let you know about a good deed done by the folks at GE Consumer Finance and other GE divisions.

Outrageous insurance quote of the month.
At the top of the in-box this month is the first of an occasional feature for "Media Watch" called "The Outrageous Insurance Quote of the Month." This month's quote is so outrageous it's laughable—or at least was when it came to us in more peaceful times. It is from Thomas Bray, columnist for The Detroit News, and appeared in the Feb. 12 edition of the paper. "Drug companies," Bray claims, "are about as popular out in the hinterlands as insurance salesmen and al-Qaida operatives."

Now I don't know about you, but having my industry compared to America's public enemy No.1 is not my idea of responsible journalism—even if it is done in jest. If you would like to discuss this quote with Bray, please feel free to email him at letters@detnews.com. If you come across an outrageous insurance quote you want to share with the rest of our readers, please email me at dconnell@advisortoday.com.

Medicare reform glows white hot, then fades in the dust of war
For about a week in late February and early March, the topic of Medicare reform was white hot in Washington, then faded in the dust with news of impending, then inevitable war. The political jockeying among the ever-expanding field of Democratic presidential hopefuls and tentative moves by President Bush before the war brought the issue to the floor.

However, while most Americans agree that Medicare is broken, the issue fails to gain much traction, particularly during a time of war. Washington Post columnist Howard Kurtz—my personal hero and inspiration for this column—put it simply when he said:

"While everyone agrees the system has problems, most Americans are satisfied with their own health care. Doctors, hospitals and insurance companies are hugely influential interests with the power to derail legislative changes. And the 41 million who don't have health coverage don't have a lobbyist. So there's a tremendous resistance to tinkering with the status quo."

In The New York Times, the issue of Medicare reform was characterized as being a choice between "guns or butter." Bush, the paper maintained, must choose whether he will push ahead with a nuanced domestic agenda or prosecute a war. Pushing legislation as complicated as this takes "presidential focus and political capital," the Times argues. "Already, the rollout of the Medicare plan suggests that an administration noted for its message control and internal discipline was stretched thin. An early draft was overwhelmingly criticized—by members of both parties."

It is a well-established fact in the medical community that minority patients tend to fair much worse when it comes to medical conditions.

Aetna collects racial data
When we hear that a company is collecting racial data on its customers, some of us might get an uneasy feeling. When we find out it’s an insurance company, we should all get uneasy. However, this time around Aetna's move to collect racial data, as revealed by The Wall Street Journal is good news for the industry.

According to the venerable paper, Aetna has begun a limited campaign to collect ethnic data from its 14 million-plus health plan members to track disparities in meeting the medical needs of minority patients. While the issue may raise some sticky privacy concerns, the giant insurer's heart is in the right place. It is a well-established fact in the medical community that minority patients tend to fair much worse when it comes to medical conditions. Even when socio-economic factors are excluded, minorities don't seem to get the treatment they need. Aetna's study is designed to address this issue and, eventually, improve minority health care.

"There is a disparity under every rock and a disparity behind every tree," Aetna Chairman and CEO John W. Rowe, told the paper. "We need to do something about it. … There are reasonable concerns about gathering data, but that's not reason enough not to do it. … We can't provide interventions for people at risk if we don't know who they are. We came to the view that not doing this was the racist approach."

War and terrorism insurance
Before the war in Iraq began, the market for terrorism insurance opened with mixed results. According to a March 9 article in The New York Times, the market for the product in Manhattan was rather cold. Most building owners and management companies realized the chances of a terrorist attack occurring in Manhattan were pretty good. However, they also realized that their buildings were unlikely targets and that costs for coverage were huge.

"I've seen total premium increases of as much as 20 percent," Andrew Schutzman, president of AMS Risk Management and Consulting told the paper. He added that large residential properties with an annual premium of around $80,000 saw increases of as much as $16,000. Other real estate brokers and analysts told the Times they'd seen premiums rise by as much 40 percent.

In the San Francisco Bay area, the local government decided not to pony up $4 million per year for terrorism insurance on the Golden Gate Bridge, saying that the price tag is just too high for the famed landmark, which is currently valued at $2.1 billion.

However, on March 20, The Dallas Morning News reported that school districts in Arlington and Plano, Texas were paying for terrorism insurance.

"As far as children are concerned, we have a real low tolerance," Tony Harkleroad, assistant superintendent for finance for the Richardson school district, told the paper. "We feel our tolerance for risk wasn’t high enough to forgo the coverage."

Oh, and just in case you were wondering, the NCAA paid about $500,000 in insurance to cover any losses if "March Madness" was cancelled.

Finally, some good news…
To end on the high note, in this "the cruelest" of months, "Media Watch" would like to congratulate GE Consumer Finance and other GE businesses for sponsoring "Freedom: A History of US," an exhibit of American history currently on tour throughout the country. The exhibit, which features documents, photographs and artifacts spanning 200 years of American history, is a companion to Joy Hakim's award-winning book of the same title. A 16-part series based on the book was also sponsored by the GE groups and appeared on PBS.

Here's hoping this kind of story leads "Media Watch" next month. …

Am I missing something? Did you read an essential story on investor confidence? Is Law and Order sticking it to the insurance industry again? Have you read a book that deals with the financial services industry? Is this a poorly written column and a disgrace to the industry? Sound off on Media Watch by emailing your thoughts to David Connell.

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