Sebelius Asks Insurers for More Transparency on Premium Increases
During a meeting at the White House on Thursday, HHS Secretary Kathleen Sebelius asked the executives of five large insurance companies to justify the companies' rate hikes of up to 39% that have affected individual policyholders in at least six states, CQ HealthBeat reports.
Sebelius requested that Aetna, CIGNA HealthCare, Health Care Service, UnitedHealth and WellPoint post information about the increases online along with supporting financial data. While meeting participants did not concretely agree to the request, several officials agreed that more transparency is necessary (Norman, CQ HealthBeat, 3/4).
Much of the data is already available through filings to state regulators, but it is difficult to access (Adamy/Johnson, Wall Street Journal, 3/5).
Noting the companies' high profits, Sebelius called the rate hikes "unacceptable" and "unsustainable." She said that "the bright spotlight may help to discourage some of these wildly exorbitant increases from occurring" (Sidot, Los Angeles Times, 3/5). Sebelius also said that consumers are "sitting ducks" for sizeable increases in the individual market (CQ HealthBeat, 3/4).
However, the insurance executives argued that their companies are significantly less-profitable than understood and asserted that their companies' average profit margin was 2.2% last year.
They said that their higher rates are reflective of rising costs in other segments of the U.S. health care system, including drugmakers, medical device makers, hospitals and other health care providers (Wall Street Journal, 3/5).
Hikes Key Argument for Obama's Health Proposal
President Obama, who stopped by the meeting, has used the rate hikes as a pivotal argument for a national health system overhaul, the Los Angeles Times reports.
His plan would establish a new marketplace where individuals and small businesses could purchase coverage. The president's proposal also would create a new consumer protection agency empowered to deny or roll back unreasonable rate increases and collect refunds for consumers.
While the insurance industry opposes much of Obamaâs health reform plan, the executives also expressed concerns about cost-containment efforts. They said high costs are driving their healthiest customers to drop coverage, leaving them with a relatively sicker, more expensive pool of policyholders (Los Angeles Times, 3/5).Angela Braly, CEO of WellPoint, called Thursday's meeting "an open exchange about how we get to this underlying cost issue," and noted that the insurers were able to share policy suggestions (CQ HealthBeat, 3/4). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.