Obama Administration Takes on Health Insurance Companies
Administration says insurance companies pull in profits while raising premiums
Feb. 18, 2010— -- Health and Human Services Secretary Kathleen Sebelius railed against the insurance companies today for raising premiums at a time when companies still post profits.
"The five largest insurers in America have declared more than $12 billion worth of profits in 2009," Sebelius said at a news conference. One of those companies, WellPoint, is a for-profit company that owns Anthem Blue Cross of California. They are about to increase rates on coffee shop owner Jesse Fink.
Come May, he'll pay $325 more per month to insure his family.
"I felt like it was extortion. I felt like it was a crime. They had you by the throat and if you don't like it leave. That's not right," said Fink.
2009 a Record Year for Insurance Company Profits
it was a banner year for health insurers. While those profits were coming in, 2.7 million of the companies' customers lost their insurance and the average premium for health insurance went up -- 5.5 percent for family coverage and 2.6 percent for individual coverage, according to the Kaiser Employer Health Benefits Survey.
Today, the government pointed to examples in six states where insurers request premium increases of anywhere from 20 percent to over 50 percent.
Companies Say Higher Medical Costs Mean Higher Premiums
The insurance companies see it differently. Though in most states, the companies don't dispute the numbers in the government report, but they say the requests for higher premiums were not driven by profit.
