Monday, September 28, 2009

GradMed III: Revenge of the Sith

So about a week ago, taking time out from advocacy for the public option, I did a review of an insurance broker called GradMed. They sell temporary, non-renewable insurance that doesn't cover any pre-existing conditions to recent college graduates. The way they sell it is by paying royalties to university alumni associations, and then pretending that it is the alumni association that 'sponsors' the GradMed program.

I pointed out that if you get sick while on a 30-day GradMed policy, the second your policy runs out, you're essentially screwed: GradMed won't let you buy another policy, and no other insurance company will cover you, either. I think I probably said something like AVOID GRADMED LIKE THE PLAGUE. Review complete! Good blogger.

I was pretty much convinced that I'd done my civic duty, hopefully let some people know what I thought about a product, and that was that. But GradMed appeared. Almost immediately, and in a big way: over the days after my review, they logged over six hours on the site, viewed each of my tiny little blog's 50-something entries more than once, and did so from somewhere between three and five different IP addresses. This struck me as a pretty poor use of man-hours paid for by the insurance premiums of unemployed college graduates, and I said so. Their page views dropped off a great deal -- but curiously, the number of hits I got from suburbs around their offices increased quite a bit, and I actually got my first few Tor nodes visiting the blog -- a novel use for an anonymity service that I thought was reserved for antigovernment protesters abroad and child pornography afficionados.

At this point, I felt like detonating. I had asked them a series of questions that they were ignoring, but they were still running around trying to sniff out information about me, viewing my profile, looking a great deal at some pictures I took of a local rally. I was rolling up my sleeves and getting ready for, well, you know, midnight deer-fighting:

Two things happened, though -- first, I got a (heavily solicited) letter from internet president Ze Frank that essentially said not to get obsessed with these people, because they're an economics-only operation, and will boringly continue to protect their financial interests, which is not something any real person wants to read about. Second, though, GradMed came back to the comments and tried to sort of whitewash their names. And I couldn't be angry. These people are symptoms: they're the runny mucus that shows that the system is ill.

The epiphany moment, for me, came in question two -- I had asked them to share their "income-to-benefits ratio" with me, a comparison of the money they take in through premiums, and the money they pay out in health benefits. They, predictably, declined to do so, but took the opportunity to haughtily correct me: "I can tell you that what you are referring to are loss ratios." Loss ratios -- these are not only people who consider fulfilling their contractual obligation to pay for the health care of the sick and injured a loss, but see absolutely nothing wrong with that thinking. They've internalized the values of their industry to the extent that they've stopped thinking, exactly, about what 'loss' is, and who's losing. Likewise with their refusal to disclose how much of a kickback alumni associations get every time a student signs up with GradMed -- "Our compensation to associations is protected by contract. " Of course -- a silly question to ask. If they shared the way they sink our premium dollars into marketing, we'd know that sending them money is a massive waste of resources, and we would stop sending checks. We'd probably also think twice about supporting our alumni associations. Thus the secrecy in the contract. It's logical, right?

It's the plight of the parasite: like every other corporation, this one has evolved a culture that serves the survival of the company. But we -- and by this, I mean you, me, recent college graduates, health care providers -- don't want this company. We're harmed by it. Piece by piece, state by state, we're trying to pull it loose from the open sore it's feeding from. But it doesn't know it's a parasite. It acts in self defense just like any other animal would, and it cares about itself and thinks it's a good parasite, a hard-working parasite that does exactly what a parasite's supposed to do:
(Insurance companies actually share risk among large groups of people, which can be interpreted as a kind of service, and so they aren't quite as parasitic as brokers -- more like those little birds that eat bugs off of hippos, at least if they're run right.)

The answer is not to face up to these people and convince them they're wrong -- at some level, I think, they already know that what they do isn't really helping matters much. The answer is to just pinch them off at the sucker and drop them back into the lake. Through legislation, through boycott (although it's not actually a boycott when you refuse to buy a service because it's worthless), through education. I'm so glad that most of the reform legislation in Congress outlaws the use of pre-existing conditions to deny people insurance, and although I'm sure the fine people at American Insurance Administrators, part of USI Affinity, subsidiary of the USI Group, whole broker for GradMed, will be very sorry to clean out their desks and go back on the job market, we'll all be better off in the future for it.

PS: I also had the chance to hang out with blog stalwart mattlo this weekend, and he, in his outwardly reserved but fundamentally hot-blooded Midwestern way, allowed as how he didn't feel so sorry for the GradMed crew, and how even his job, which he enjoys just fine, is not quite as cushy as sitting in an office reading our blog (he has to sit in an office and do real work). So for all the mattloes of the world, here's thirty seconds devoted to unrepentant pushback. The GradMed IP address that has, now, over 90 visits to the blog is, which apart from a few fake Wikipedia entries/commercials/some spam, hilariously has also been used to create a large genealogy website for the Sawn family which is run by a gentleman named George (that's their guestbook). A tiny bit of googling shows that one likely (although I'm sure there's a lot of unprotected computer-sharing in the office organism) visitor to the blog is therefore George Sawn, CFO of Univers Workplace Benefits, subsidiary of USI Holdings, whole owner and operator of USI Affinity, parent company of American Insurance Administrators AKA GradMed. You can get in touch with him at, if you feel like it or if you think y'all are related.


  1. Thank you! I know it's been nearly 5 years since you penned this blog post, but it is still useful today. A friend of mine told me about GradMed because we're both looking for insurance after finishing up graduate school (and losing the health benefits that came with being university employees). I vaguely recalled receiving some flyers in the mail from my alumni association many years ago, and I think it was this company.

    After clicking through the GradMed site and looking at quotes, I started getting suspicious and found your blog through a search engine. The information you've provided is very helpful.

  2. I just graduated from UNC-Chapel Hill, and I got a GradMed letter in the mail. Their 6-month policy was $60 or $77 per month, depending on the deductible, but I definitely wanted to find out more about the company before I bought anything. There is an astounding lack of information on their website, and every time I tried to connect with their online help chat, they disconnected me (lol).

    Thanks for providing this review. It's still relevant.