HHS Sec. Sebelius Sends Letter to Insurance Co. CEOs, Calls on Executives to Justify Premium Hikes

Monday, March 8, 2010

In a letter to the CEOs of UnitedHealth Group Inc., WellPoint Inc., Aetna Inc., Health Care Service Corporation and CIGNA HealthCare Inc., U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius called on the executives to publicly justify proposed health insurance premium increases. Sebelius’ letter comes after a meeting last week with these executives at the White House.

“Last Thursday, I asked CEOs to post online the actuarial justification for premium hikes so consumers can see why their premiums are skyrocketing. Now, it’s time for these insurance company CEOs to do their part to make the system more transparent for the American people. If insurance companies are going to raise rates, the least they can do is tell us why.”

The letter comes shortly after a new analysis from Goldman Sachs found that competition in the insurance market is so weak, insurance companies can continue to raise rates even if it means losing customers. The analysis found that “price competition is down” and that “incumbent carriers seem more willing than ever to walk away from existing business.”

A copy of Sebelius’ letter to the executives . . .

Dear__________,

Thank you for taking the time to join our discussion about health insurance premium increases on Thursday at the White House. There is no question that our health insurance system is broken, and unsustainable for both the American people and your companies. I appreciated the opportunity to meet with you and discuss these very serious issues.

As we discussed, both the President and I continue to hear from concerned Americans who don’t understand why their premiums continue to rise. For many families, these high premiums have made health insurance unaffordable. At the same time, these families have heard reports of insurance companies taking in multi-billion dollar profits.

At our meeting, you and your colleagues discussed the importance of addressing and controlling the underlying cost of health care. President Obama agrees, and his comprehensive health reform proposal includes a series of cost-reduction strategies. You noted the need for a larger pool of insured individuals to balance risks. This element is also included in the President’s proposal.

In our discussion, we also agreed that we will all benefit by making our health care system more open and transparent. To that end, I am reiterating the request I made at our meeting on Thursday: post on your websites the justification for any individual or small group rate increases you have implemented or proposed in 2010, and continue to post such a justification in connection with any future increases. Posting this information will give Americans the opportunity to learn more and ask questions about rate increases that affect them.

At a minimum, I ask that you include the following in your justification:

1. Your estimates on medical cost and utilization increases, the assumptions driving these estimates, and the basis for those assumptions.
2. If your premiums increase more than estimated medical costs, a description of what accounts for those differences.
3. The number of people who will be receiving premium increases, as well as the number of people who will be receiving different levels of premium increases, further broken down by characteristics including plan type, age, and sex.
4. Enrollment changes in your different plans since the past year.
5. The number of people on whose experience the rate increase is calculated.
6. Any premium rating variation including rating variation by age and health status.
7. An affordability plan explaining what the company is doing to improve the affordability of health care, and the estimated financial impact of the company's affordability initiatives.
8. An explanation of any cost containment or quality improvement efforts you have made that affect the increase.
9. The expected medical loss ratio resulting from any premium increase.
10. Information on the percentage of premium revenues you spend on medical claims, disease management, quality initiatives, administrative costs, profits, and executive salaries broken down at least by market type.

The President is committed to passing health insurance reform that fixes our health insurance system and helps bring down costs for all Americans. These reforms will give American families the peace of mind they need and deserve, and will make our system more transparent. I hope your company will join our effort to make health care in America more transparent, and post this critical information without delay.

Sincerely,
Kathleen Sebelius

http://www.hhs.gov/news/press/2010pres/03/20100308a.html

That'll sure make them straighten up and fly right -- yes? They'll be soooo embarrassed. :rofl: :rofl:

...that wasn't trembling, it was uncontrollable laughter!

I think this request is intended and expected to be backed up by some executive or legislative response. Or would it be better if the administration said nothing at all to these CEO's ?

Get a spine... ha ha ha... clueless... etc. :-(. They should not be asked to jutify anything, they should just be declared illegal and sent to the gallows (not necessarily in that order)... I just don't get it.

the insurance industry to the discussions.

:shrug:

Look what they have been doing for the past year, they have excluded those who challenge the industry while inviting the industry execs inside the WH gates.

Then they tell the people they are really fighting these nasty corporations.

Watch who they let through the gates and invite to Congressional hearings, watch what they do, not what they say.

You do not seriously challenge them by silencing their critics.

. . . the President's in St. Louis today: http://www.publicbroadcasting.net/kwmu/news.newsmain/article/1/0/1621887/St..Louis.Public.Radio.News/Obama.visits.St..Louis.to.continue.health.overhaul.push

The 'meetings' he had with industry CEO's weren't reported as bull sessions or tea parties. The President has challenged the industry to reform at every occasion, and, at the same time, reached out to the American public for input. I don't see where he's 'silenced his critics' at all.

industry.

For decades there has been a movement to try and establish a national HC, but this movement is a direct challenge to the for profit insurance, who do nothing to provide care or add any value to the product of "health insurance."

Conyers asked the President to invite two people to the WH Summit in March 2009, his request was denied.

ABC invited the President's former personal physician of 22 years to the Town Hall meeting at the WH, they were in the midst of arranging for his visit to DC, but called him at the last minute to say there was not enough room. He has been a Medicare for All supporter for years and had planned to ask a question on this topic. Then we watched the President call on Ron Williams the CEO of Aetna, of course there was room for him.

We all witnessed the Baucus hearings and how advocates for SP were not invited and we all saw the representatives of the for profit industry at the table.

So if you really want to take on these evil corporations why then are you silencing the people who question their business.

:shrug:

Even last week we saw the meeting with insurance execs moved to the WH and then the media reports how the President read them a letter from someone who had problems with insurance.

The fact remains that at every turn they have been allowed to pass through the gates of the WH and sit at the table and those who mount a real challenge to them have been kept outside. How do you mount an effective fight against the insurance companies when you simultaneously silence their harshest critics.

I still don't think that represents an effort by the President to 'silence his critics'. We disagree. :shrug:

silence critics of the insurance industry when he excluded them from discussions and did not allow a real debate on HC.

Do you see the difference?

All this nonsense is act 2 of the Insurance Kabuki Theatre.

Kathleen Sebelius called on the executives to publicly justify proposed health insurance premium increases

They have to 'justify' their backbreaking greed! Now that's getting somewhere!

Does anyone in this administration have a spine?

. . . regarding their rate increases. I'm glad the administration is taking a public stand on this. Remember, this effort is in concert with an ongoing political process to reform the insurance system. Today, the HHS Secretary has pushed her way into the Insurance Executive's conference to publicly demand transparency and justification of proposed and effected rate increases. No one is suggesting that this effort from the administration is the end to the process or the ultimate remedy to the increases and the effort will be helpful as legislators are working to find ways (and votes) to hold the industry accountable. I really don't understand the criticisms here. Would folks rather the White House didn't publicly demand transparency from the industry?


Sebelius To Lion's Den: Plans To Address Insurers

Kathleen Sebelius plans to take the administration's argument for health care reform straight to the enemy this week. In a letter to top insurance lobbyist Karen Ignagni, Sebelius asks to address the annual gathering of America's Health Insurance Plans (AHIP) on Thursday at 10:30 a.m.

Sebelius, the Health and Human Services Secretary, reminds Ignagni that she had previously invited her to speak and notes that insurers have been rapidly raising premiums, making particular note of Anthem Blue Cross and Blue Shield of Virginia.

AHIP has already been targeted by protesters associated with the pro-reform coalition Health Care for America Now, as well as MoveOn.org. The convention is being held at the Ritz-Carlton in Washington, DC.

The annual gathering comes as House and Senate leaders are putting the finishing touches on a strategy to pass a final health care bill using a majority-vote maneuver known as reconciliation.

http://www.huffingtonpost.com/2010/03/09/sebelius-to-lions-den-pla_n_491916.html

"Three little maids from school are we,
Pert as a school-girl well can be,
Filled to the brim with girlish glee,
Three little maids from school!"


:rofl: :rofl:

For months we've heard two things consistently -- the President and his staff have been having talks at the White House with the CEOs of the biggest and greediest health insurance scams. For months people have been trying -- even members of Congress to get this same president to live up to his promise that these meetings would be televised. It has not happened. For months, people who are advocates of things like single payer, universal health care, medicare for all, and a robust public option have tried to meet with this President or his reps. It has not happened.

Either you're incredibly naive or willfully ignorant or perhaps both.

I predict that the response to their response will be, "Oh gee, well, OK then. May I have another, sir?"

It's all theater.

But in the middle of the ongoing and culminating effort to craft legislative reform, the actions of the HHS Secretary are significant and should be embraced by legislators and 'reformers' in their own work to hold the insurance industry accountable. We can't pretend like the administration has the authority right now to penalize or check the rate hikes. This public pressure is what should lead to that accountability folks say we need from the industry. The cynicism about the HHS Secretary doing her job is odd. I remember almost a decade where we had no demands for transparency from the previous administration at all. Now we have a White House aggressively challenging the industry, even as they are actively working to legislatively reform the health insurance system. That's more than just 'theater'.

Of course, that sort of CHANGE doesn't happen with this administration.

The administration works to implement and uphold them, as well as propose new ones.

Seems to be the sop of this administration, to make a show of doing something then doing nothing.

Of course the Congress has it's part, but who controls that?

Your allusion to rate hikes simply makes the point of who runs the show in this and almost every other country, big business.

In many ways "hope", the possession of a dream of something better in the future, is what keeps all of us plodding through the muck. Yet, it somehow seems out of place in a letter from a government agency to a business, suggesting the real power lies in the biz. Is this another example of the lack of spine so often decried, but this time being demonstrated by an Executive Branch regulator?

"I hope your company will join our effort to make health care in America more transparent"

Why is the government hoping "health care" is more transparent? Shouldn't people's medical records be between their doctors and themselves, and shouldn't the "finances" of "health insurance" be more transparent?

But I don't understand what the White House can do beyond the laws already on the books to regulate rate hikes. That's why the administration is pushing for the reforms in the legislation they're busy promoting.

Do you know of any worthwhile regulatory reform proposal that they've rejected and should adopt? It's Congress who is writing the bills and the administration is limited to proposing reforms as part of that legislative effort. I really don't see this administration standing in the way of any meaningful and supported effort in Congress to regulate or force accountability from the industry on rate and premium hikes. The 'bully pulpit' is the administration's primary lever for legislative action. Outside of that, they can only propose laws and work to implement and enforce them through the Justice Dept..

( . . . and I don't think the administration is concerned with private health records. The 'transparency' refers to the process of raising rates and premiums.)

No private money allowed. Not for legislators, judges, and executive branch elections and campaigns, nor for local, state, and national campaigns and elections, nor for any other elective offices, including any that might be created in the future and any others that may not be specifically mentioned herein. All candidates for similar offices would be given equal public resources to conduct their campaigns.

It's a longer term fix, and does nothing to help with the current Health Care versus Insurance issue.

worthwhile topic.

This letter is not the best way IMO.

It's not as if this letter is the totality of the administration's efforts. It's a public tug at the industry (along with the last-minute appearance at an industry conference today to publicly rebuke the insurance CEO's) in concert with the ongoing legislative effort.

Most of the 'power' of the Executive branch is in the elevation of their 'bully pulpit'. That's how it should be in our democracy. I think this 'letter' and the public rebukes are necessary, responsible, and very much what the Executive branch should be doing with their influence and ability to garner attention and focus to issues and legislation. This pressure from the White House is also in concert with a flurry of activism outside of government from MoveOn and other protesters, and I'm sure the administration's public and vocal support is appreciated. After all, the White House has no independent way of affecting rate and premium increases without legislation. This push from HHS is very much in line with the developing process to change the laws and require more accountability.

If Obama actually turns her loose she will take it to them.

I hope he has the political fortitude to let her off leash.

. . . before she became governor.

Premiums need to account to these things and more.

Good grief! I hope people realize that they're being played. "A strongly worded" public letter! Oh yes! That'll do the trick. :eyes: Fucking pathetic. Disgusting when you considering the millions of Americans who will die as a result of this pussy-footing around, this theater.