Posted on 26 Aug 2009
Senator Jay Rockefeller is on a fact-finding mission: He announced he has sent a letter to the nation's top 15 health insurers, requesting information on what insurance companies do with the money they get from consumers as premium payments and whether this data is shared with policy holders and potential customers.
The central focus of Rockefeller’s questions are health insurers’ medical loss ratios – the percentage of premium dollars insurers spend that go directly to covering consumer health care payments.
During a June hearing in the Senate Commerce Committee, Chairman Rockefeller highlighted the lack of transparency in the health insurance industry and the Committee heard testimony from Wendell Potter, a former health insurance executive who claimed that insurance companies frequently purge consumers who cost them too much money from their plans to please investors by reducing their medical loss ratios – minimizing healthcare payouts, maximizing their profits.
“Since I took over as Chairman of the Commerce Committee in early 2009, we have been investigating the health insurance industry and what we have found so far is unacceptable.
Too often consumers are not getting a fair deal for what they pay, they are not getting the protections they deserve, and the insurance companies are awash in profit – this must change, we must level the playing field. The appalling reality is that it is nearly impossible for most consumers and small businesses to know what percentage of their premiums go to provide medical care, and what percent goes to company earnings. The people have a right to this basic information and I look forward to receiving a response to my letter from each company.”