If Insurance Companies Raise Rates, Shouldn't They Be More Transparent About Costs?

Last Thursday (March 4, 2010) Kathleen Sebelius head of Health and Human Services met with top insurance executives of the largest health insurance corporations, including WellPoint CEO Angela Braly and United Health CEO Stephen Helmsley.  Executives from Aetna and Cigna insurance companies were also there.  This meeting was noted in many major newspapers, including "The Sacramento Bee" by writer Bobby Cain Calvan.

Recently, Anthem Blue Cross (a subsidiary of Angela Braly's company, WellPoint) caused a nationwide fright when they chose to raise rates 39% on thousands of their California customers.  Secretary Sebelius is asking these large health insurance companies that if they choose to raise rates they need to post the rates hikes online and also the justification for those rate hikes.  And here I quote directly from Bobby Calvan's story:

"I'm hoping that the CEOs respond to the call for putting their information up in public," Sebelius said. "At the very least, they owe it to consumers to justify why the rates are sky high," Sebelius told reporters after her meeting with insurers and insurance commissioners from four states.

Insurers didn't outright dismiss the idea, "but there were no commitments of any kind," said UnitedHealth's chief executive officer, Stephen Hemsley.

President Obama was also there and read a letter from an Ohio woman who was upset that her health insurance premiums had skyrocketed.

When The Sacramento Bee newspaper contacted the Insurance Commissioner's Office (Steve Poizner, a Republican candidate for California Governor) Poizner's spokesman responded with an e-mail saying the information (details on rates) was publicly available, but not on the internet.  It is only available to view (on paper, not on the internet) in San Francisco and Los Angeles.  And here again I quote directly from Bobby Calvan's story in The Bee:

"The fact that you have to schlep to San Francisco to see these filings is not very transparent," said Anthony Wright, executive director of Health Access California, among those who have joined the call for greater transparency in how health insurance rates are set.

"Putting them online is a good step in California, where we have very few regulations regarding health insurance rates," Wright said.

"I think people want to know why" rates are increasing, he said. "It informs consumers as well as policymakers and others who watch the industry. How can they raise rates without justification or even without explanation?"

The rate hikes have caused many customers anger, and is another cause for laws to be changed and increase regulation of health insurance companies.  Unlike in more than 25 other states in America, California's insurance commissioner has no current authority to regulate rates on health insurance premiums.  Secretary Sebelius was quoted in The Sacramento Bee as saying consumers are "absolute sitting ducks", who "don't have any bargaining power" against insurance companies. One might ask since Steve Poizner has been Insurance Commissioner for over 3 years, why he hasn't fought to make the prices more transparent??  If Poizner does NOTHING to curb (or at least tame) premium hikes for health insurance customers, does he care for the average Californian???