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After Stanford professor Jeffrey Pfeffer got back surgery years ago, he kept a file folder labeled “Blue Shield Troubles.”

When Pfeffer got an offer to collaborate with the polling company Gallup, he suggested a study on how much time Americans spend on the phone with their health insurers. Gallup agreed.

Their finding: We spend about 12 million hours a week calling our health insurance. (They also found that, as workers, calling our health insurance companies means we’re more likely to miss work, and to be more checked-out and burned-out on the job.)

And given all that … it’s important to know as much as possible about who we’re actually on the phone with when we make those calls. Like, how do they make money? What are the incentives?

Here’s something few of us know: In many cases, the companies are not actually getting paid to provide insurance. If you get your insurance through work, your employer probably “self-insures.” (That’s true for about two-thirds of all workers, and more than 90% of people who work for companies with more than 1,000 employees.)

But it isn’t obvious if your job self-insures. You’ll have an insurance card that says Cigna or United or Aetna etc. But you’re operating in a different universe. For instance, self-funded plans are governed by federal law, so your state insurance commission can’t step in and help. And that’s just a start. 

In this episode, we start to get our bearings on that different universe. We talk to Pfeffer, to one of our favorite insurance brains, Karen Pollitz of KFF and to journalist Leslie Walker, whose reporting for the podcast “Tradeoffs” indicates that when companies are playing their role in “self-insured” setups, they can get up to some shady practices. And the employers they’re working for — even big, powerful outfits — often don’t exercise a lot of oversight or even have a lot of leverage.

Here’s a transcript for this episode.

“An Arm and a Leg” is a co-production of KHN and Public Road Productions.

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