Insurers, White House Don't Agree on Who's to Blame for Rising Health Costs

Joe Cantlupe, for HealthLeaders Media , March 5, 2010

Leaders of the nation's four largest health plans told HHS Secretary Kathleen Sebelius at a White House meeting Thursday that they share a "common purpose" with her to improve the nation's healthcare system, but they defended their proposed double-digit rate hike in the individual market.

The meeting was seen as cordial and somewhat productive, but essentially broke no new ground, with both sides sticking to their months' long talking points: The administration saying the insurance premiums are too high and the insurers blaming healthcare costs for the increases.

To add further weight to the administration's position, President Obama stopped by the meeting, bringing with him a letter from a health plan consumer facing a 40% rate hike in Ohio, according to the White House. "Seeing that kind of rate increase is unacceptable and unsustainable, as the president said," Sebelius stated later. She added that she sought "transparency" from the insurance executives, and asked them to post their rate requests online.

Insurers attending the meeting with Sebelius were Aetna CEO Ron Williams, UnitedHealth Group CEO Stephen Hemsley, WellPoint CEO Angela F. Braly, CIGNA CEO David M. Cordani, and Health Care Service Corp. CEO Patricia Hemingway-Hall.

The health plan leaders said layers of bureaucracy must be reduced in healthcare, and signaled support for broad participation in the overall health insurance pool to reduce costs. During the meeting, Williams, the Aetna CEO, insisted that insurers want to cooperate in reform efforts.

"We really share a common purpose. We recognize there are issues, particularly in the individual insurance market that need to be addressed," Williams said.

The proposed rate hikes are "really reflective of other parts of the healthcare delivery system," he added. Williams' comments were made during a brief open portion of the mostly closed session, reported by a pool journalist and released by HHS.

After the session, Hemsley, the CEO of UnitedHealth Group, said the insurers' participation reflected a "desire to identify a fiscally responsible, sustainable path forward that truly bends the cost curve."

"We sought to make clear our longstandng commitment to expanding access to quality care for all Americans and also to discuss the many factors that are driving up the cost of care for millions of people across the United States," he said.

Cordani, CEO of CIGNA, said insurers went to the meeting "with a willingness to seek a sustainable solution."

"We discussed and offered our perspective on how to solve our country's healthcare challenges by reduced cost, improving affordable accessing, and increasing quality of care, " Cordani said. "The current health system—whether commercial or government—is not on a sustainable track and challenges job security and growth."

Although Obama and Sebelius have continually chastised the insurance industry for the rate hikes in the individual markets, "The conversation today behind closed doors did not feel like it was a vilified industry being chastised by the president or the secretary," Cordani said.

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