Health Insurance Executives Questioned at Hearing on Industry Practices

In the second day of a congressional hearing on health insurance practices, senior executives of major insurers were called to answer questions -- the most critical coming from the Democratic lawmakers.

The day before, the U.S. House of Representatives subcommittee on domestic policy's hearing had focused on individuals wronged by the industry and former industry insiders now speaking against their former employers. That day of testimony, Sept. 16, lent ammunition to the sometimes confrontational questioning of executives from UnitedHealth Group, WellPoint Inc., Aetna Inc., Humana Inc., Cigna Healthcare and Health Care Service Corp.

Rep. Dennis Kucinich, D-Ohio, chairman of this panel of the House Oversight and Government Reform Committee, led the criticism. "Hundreds of thousands of people have been wrongly denied coverage, hassled with unnecessary documentation requests, underpaid claims, ripped off by fixed databases that underpaid claims. The actions of insurance company bureaucrats in causing needless delays and denials of coverage for prescribed treatment can be as detrimental as the disease itself."

Much of the Democratic questioning focused on denials of claims and on rescissions of coverage, and the lawmakers expressed frustration over the company representatives' answers, which painted pictures of corporate responsibility that clashed with the previous testimony. Republicans were more likely to pursue questions that helped the industry officials cast doubt on potential for a government-run insurer.

Rep. Edolphus Towns, D-N.Y., chairman of the overall oversight committee, told the executives their companies' practices "are unacceptable and must be reformed. If a company sells insurance, it must provide insurance coverage."

In the questioning, most of the industry representatives explained that their companies favored changes to the health care system -- most notably a mandate for universal coverage and a cessation of restrictions for pre-existing conditions. "WellPoint supports responsible health care reform," said Brian A. Sassi, president and chief executive officer for consumer business at the company. And James H. Bloem, senior vice president, chief financial officer and treasurer at Humana, said, "We believe that doing nothing is not an option."

And in response to repeated mentions of rising health costs, Patricia Farrell, a senior vice president at Aetna, said, "Health care costs drive insurance premiums -- not the other way around."

Rep. Jim Jordan, R-Ohio, said, "My friends on the other side believe that more and bigger government is the answer. I think that most Americans, like me, instinctively realize that trading some challenges with insurance companies for the bureaucracy of the federal government is certainly not the solution."

Most Cigna insurers have current Best's Financial Strength Ratings of A- (Excellent), and UnitedHealth and Aetna insurers' current ratings range from A- to A (Excellent). Most Humana insurers ratings range from B+ (Good) to A- (Excellent). Most Health Care Service Corp. companies have current ratings of A+ (Superior).