Insurers' Pricing Practices Targeted By Senate Health Committee

Senate health committee Chairman Tom Harkin, D-Iowa, asked four of the nations largest health insurers - Aetna, Humana, Wellpoint and UnitedHealth - to explain their pricing policies after small-business owners testified Tuesday that insurance premiums were crushing their businesses, the Des Moines Register reports. The requests for information covered factors used in setting premium rates as well as details about highly paid employees and officers of the companies. Harkin asked for responses to the requests, which are not enforceable subpoenas, by Nov. 17. A spokesman for insurers "called the move unfair and misguided" (Clayworth, 11/4).

A House lawmaker announced a similar investigation in August, the Associated Press reports. This investigation comes as a skirmish in the "all-out struggle over the health care overhaul" between President Obama and the insurers. Democrats recently "have pushed for stripping the insurers of their decades-old exemption from federal antitrust laws." Before Harkin announced the inquiry, a small business owner from Pennsylvania complained that many companies were facing larger premium hikes than the average - 11 to 16 percent for next year. He "said he saw an initial quote for coverage that involved a 128 percent cost increase. He eventually found a policy that cost 43 percent more" (Murphy, 11/3).

"Health insurance companies should open their books and explain to the American people why they support a health insurance market for small businesses that is so dysfunctional, and so lacking in transparency," Harkin said in a statement, Reuters reports. Separately, "On Monday, [Sen. Jay Rockefeller, D-W.Va.,] said an analysis shows for-profit health insurers are using less of collected premium dollars to pay for actual health care services than had previously been made public" (Heavy, 11/3).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.