Health insurance pricing draws administration's wrath

WASHINGTON - The Obama administration stepped up its criticism yesterday of health insurers' recent efforts to raise their rates - an attempt to harness public aggravation with the industry and rebuild momentum for broad changes to the nation's health care system.

At a news conference, Health and Human Services Secretary Kathleen Sebelius cited half a dozen examples in which insurers have in the past year sought large premium hikes on people who buy coverage individually. In all but one case, according to a report released by HHS, state insurance regulators rejected all or part of the requested increases.

"It shines a light on the urgency for health reform," Sebelius said, contending that health care bills, passed by the House and the Senate but now languishing in Congress, would hold down insurance prices, in part by requiring companies publicly to file proposed rate changes in advance and justify their requests.

The administration's attempt to focus attention on insurance prices broadens a strategy it began to employ 10 days ago, when Sebelius wrote a pointed letter to one insurer, Anthem Blue Cross of California. She demanded to know why the company had alerted about 800,000 policyholders that their premiums would rise by as much as 39 percent because of rising health care costs. In response to HHS' inquiry, Anthem postponed the increase by two months.

The new report cites another example from this year: Anthem Blue Cross Blue Shield of Maine is asking that state to approve a 23 percent rise in premiums for its individual-market customers, after state regulators slashed an 18 percent increase the insurer requested in 2009. The other cases in the HHS report are from last year.

Congressional Republicans and the insurance industry denounced the administration's strategy, saying it mischaracterized the problem and solution.

Senate Minority Leader Mitch McConnell (R-Ky.) said congressional budget analysts have predicted that insurance premiums would continue to go up, even if the health legislation before Congress were enacted.