The Multinational Monitor


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Smoking Out Patients

Health insurance companies, the largest owners of for-profit health maintenance organizations (HMOs), are also major shareholders in tobacco companies, according to an article in the July 8, 1995 issue of the medical journal Lancet.

The article, by Dr. J. Wesley Boyd, Dr. David U. Himmelstein, and Dr. Steffie Woolhandler of the Harvard Medical School and Cambridge Hospital, analyzed tobacco company filings with the Securities and Exchange Commission.

The authors found that Prudential, the largest supplier of health insurance and the largest U.S. owner of for-profit HMOs, owns a large share of five of the six largest tobacco companies. As of January 1995, Prudential owned $103 million of Philip Morris stock; more than $12 million of RJR Nabisco; almost $97 million of Loews (maker of Lorillard, Heritage, Kent and Newport); and over $36 million of American Brands (makers of Lucky Strike, Carlton, and Benson & Hedges cigarettes). Travellers Insurance Company holds almost $52 million in American Brands' stock and $37 million in RJR Nabisco.

MetLife, which recently merged with Travelers to form the second largest health insurer, has over $15 million invested in RJR Nabisco. Cigna Insurance owns $18 million in American Brands and $57 million in Philip Morris.

"Giant corporations are taking over health care," says Woolhandler, an associate professor at Harvard Medical School and spokesperson for Physicians for a National Health Program. "Yet both the president and congressional Republicans push Medicare HMOs and other policies that place Americans' health care in these corporate hands. We need to make medicine a public service, not a business. We need a Canadian-style, single-payer health care system."

Dr. J. Wesley Boyd, a psychiatrist at Cambridge Hospital, says, "For Prudential, concern for health runs a distant second to concern for profit. They urge us [in advertisements invoking their corporate logo] to 'Get a piece of the rock.' A granite headstone, perhaps?"

Prudential did not return calls seeking comment.

Pollution Smokescreen

With the toxic release inventory (TRI) program coming under attack in Congress, the Environmental Protection Agency (EPA) announced an enforcement initiative in late June 1995 against 47 companies that released toxic chemicals into the environment without informing the EPA and the public, as required under the Emergency Planning and Community Right-to-Know Act (EPCRA).

The companies on the list include Hercules Inc. of Kenvil, New Jersey, Grief Brothers Corporation of Cullman, Alabama, Rhone Poulence Basic Chemicals of Martinez, California, and Potlatch Corporation of Lewiston, Idaho. EPA assessed $2.6 million in penalties against the companies for failure to supply information on the release, transfer and management of 36 toxic chemicals.

Under EPCRA, certain companies must report releases, transfers and waste management practices for more than 300 toxic chemicals. Proposed legislation before the Senate would overturn the first major expansion of the TRI program.

The proposal, by Senators Robert Dole, R-Kansas, and Bennett Johnston, D-Louisiana, gives the EPA only six months to prove that each of the 286 chemicals that the agency added to TRI last November will cause significant health or environmental problems.

"This legislation is a special favor for polluting industries," says Ed Hopkins of Citizen Action. "If enacted, it would allow them to continue hiding releases of many common toxic chemicals."

The TRI is often cited as a model of how making information public, rather than mandating detailed regulatory requirements, can protect human health and the environment. TRI has prodded many major corporations, including Dow, AT&T and Monsanto, to set pollution-reduction goals.

EPA conducted an extensive scientific review of substances regulated as toxic under other environmental laws before adding the 286 chemicals to TRI in November 1994. The agency determined that each chemical poses a serious health or environmental hazard, such as cancer or birth defects.

"EPA should not have to prove harm before requiring information on toxic releases," says Paul Orum of the Working Group on Community Right-to-Know. "Estimating releases, exposure and health effects requires enormous guesswork."

Containing the Truth

The St. Louis-based Container Corporation of America (CCA) will pay a $1.2 million civil penalty to settle charges that it improperly responded to an Environmental Protection Agency (EPA) information request regarding CCA's involvement with a Superfund site in Troy, Ohio.

The announcement comes on the heels of a January settlement in which CCA agreed to pay $3.1 million in cleanup costs for the site. The $1.2 million fine is the largest such penalty ever given, representing more than $1,000 for each day that CCA failed to provide the correct information.

The agreement resolves charges, filed in an October 1993 complaint, that CCA told EPA that its nearby facility would not send hazardous substances to a waste disposal site operated by Miami County. CCA realized its mistake shortly afterwards but did not inform the EPA for almost three years.

"Accurate, timely information is a cornerstone in our efforts to clean up contaminated sites and resolve liability issues quickly. Without it, our ability to protect the people and the environment is threatened," says Lois Schiffer, assistant attorney general in charge of the Environment and Natural Resources Division. EPA placed the site on the National Priority List of the nation's most contaminated sites in 1984.

"We disputed what the government had to say," says CCA General Counsel Michael Tierney, "but we were presented with protracted litigation costs and decided to settle."

- Russell Mokhiber

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