Health insurance companies have been under fire the past few weeks for increases in individual health insurance rates. Not surprisingly, Health and Human Services Secretary Kathleen Sebelius and President Obama are reacting.
To discuss the rate hikes, Secretary Sebelius held a White House meeting with chief executives from Wellpoint, Aetna, CIGNA, UnitedHealth Group and Health Care Service Corp. Insurance regulators from the National Association of Insurance Commissioners also attended the meeting.
This is all significant because of the desperate push by President Obama to muster the last votes for passing health insurance reform. The rate hikes have been one of Obama’s main arguments for the need health insurance reform and have added momentum to the overhaul agenda.
Though the meeting seemed to go well, insurance executives felt that representatives from other health industries should have been invited to the meeting, reported the Wall Street Journal. Why? Because drug makers, hospitals, medical-device makers and other health care service providers have also contributed to rising health care costs. Simply trying to lower premiums doesn’t address the bulk of the problem, point out the insurance chiefs.
Still, Secretary Sebelius wanted to address the rate hikes.
The Health and Human Services Secretary asked the insurance companies to post information online so consumers could understand the need for rate increases. She also wanted insurers to post explanations for administrative costs, marketing and actual care costs.
On the topic of health insurance company profits, Secretary Sebelius criticized insurers for their $12 billion in profits last year. But the insurance executives shot back that their average profit margin was 2.2 percent last year — lower than other health industries.
Certainly, these are some interesting demands by the Obama Administration. After the meeting, it seemed insurance executives were very wary of posting all of their information online but they are considering it apparently.
The meeting seemed a bit more politically calculating than directly problem solving.