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Health Insurers to Decide Whether to Turn Over Financials Per House Democrats' Request

Source: Associated Press


Posted on 19 Aug 2009

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As part of an investigation into executive compensation and other business practices, dozens of the largest insurance companies in the U.S. must decide whether to fulfill a request from House Democrats to hand over detailed financial records.

A spokesman for Rep. Bart Stupak (D-MI), said that 52 letters had been sent to health insurers with $2 billion or more in annual premiums. He said letters were not dispatched to other industry groups, some of which have been airing television advertising in support of President Obama's call for health care reform.

The request to insurance companies included records relating to compensation of highly paid employees, documents relating to companies' premium income and claims payments, and information on expenses stemming from any event held outside company facilities in the past 2 1/2 years.

The requests were made in letters signed by Rep. Henry Waxman (D-CA), who guided a portion of health care legislation through the House Energy and Commerce Committee last month as chairman, and Stupak, who heads a subcommittee on the panel.

They wrote that the committee was "examining executive compensation and other business practices in the health insurance industry." A spokesman for the insurance industry declined to comment.

The letter from Waxman and Stupak requested the information be provided by early September. While companies are not under legal obligation to comply, the committee could respond to a refusal by voting to subpoena the information at a later date.

Among the documents requested were records relating to compensation paid to any company executive earning more than $500,000 in any year from 2003 to 2008.

Waxman and Stupak also sought documents relating to premiums paid by policy holders, claims payments, sales expenses, administrative expenses and profits, broken down by categories such as employer-provided coverage; individual coverage, Medicare and Medicaid.

The requests were issued at a time when President Obama's health care proposal is under intense attack from Republicans and other critics, including the health insurance industry. Much of the opposition focuses on proposals for the government to sell insurance in competition with private carriers.

The President and other supporters of a so-called government option argue it would help control costs and keep insurance companies honest by forcing them to grapple with competition.

Opponents say it gradually would undermine the present insurance structure, which is built around private insurers, and lead to a system controlled by the government.

The issue drew intense focus over the weekend, after President Obama speculated aloud about the possibility that legislation might omit the government role in selling insurance.

The White House said there had been no change in position. But liberals expressed dismay, giving rise to increased speculation that Senate Democrats could soon abandon all talk of bipartisanship and draft legislation tailored to their own rank and file. Any such measure would inevitably jettison many of the compromises crafted in weeks of bipartisan Senate talks, and it was unclear whether the talk was a ploy to persuade Senate Republicans to agree to a compromise.


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