Obama Administration Takes Insurances Execs to Task
Executives of leading insurance agencies were summoned to a meeting with Health and Human Services Secretary Kathleen Sebelius at the White House on Thursday, March 4, 2010 where they were called to task on recent drastic premium hikes.
The televised meeting was part of an effort on the part of the Obama administration to cultivate support for health care reform as the president presses Congress to break its stalemate and send legislation to him for approval in the coming weeks.
Although the president did not stay for the bulk of the encounter, he did appear to read a letter from a cancer survivor in Ohio who dealt with what Obama called an “unjustifiable” premium increase of 40% last year.
The executives insisted that they are responding only to the rising cost of health care due to more expensive drugs and medical devices and high rates in hospitals and care facilities.
Calling for increased transparency in the industry, Sebelius called on the executives to provide more data, accessible online, to justify their premiums. In response, the insurance leaders produced figures showing profit margins of only 2.2% for 2009.
Sebelius countered with numbers showing that the profits that were collected totaled $12 billion, an amount representing an increase of 56% over 2008.
The issue of premiums is critical to the proposed health care legislation since most Americans would be required by law to have health coverage or face fines. The new statute would, if passed, literally drive business to an industry popularly perceived by Americans as both greedy and heartless, a huge problem for the Obama administration as it seeks to cultivate both political and popular support for the reform.