Sebelius: People are worried “they’re next” in line for rate increases by private insurance companies. (Brendan Hoffman/Bloomberg)

Dow Jones Newswires | U.S. Health and Human Services Secretary Kathleen Sebelius sat down with top executives from the parent of Blue Cross and Blue Shield of Illinois and four other health-insurance companies at the White House Thursday, the latest step in the Obama administration’s effort to confront rising premium rates.

“The meeting was really focused on what is happening with the kind of jaw-dropping rate increases that people are seeing particularly in the individual and small-group market,” Sebelius told Dow Jones reporters following the session.

The chief executives of Chicago-based Health Care Service Corp., UnitedHealth Group Inc. WellPoint Inc., Aetna Inc. and Cigna Corp. participated in the session in the Roosevelt Room. Officials from the National Association of Insurance Commissioners also were in attendance.
Sebelius said she asked the companies to file online their rate requests, along with actuarial data that support those requests. “At the end of the day I still think there is a concern that the medical trends don’t match the rate increases,” she said.

“I’m hoping that the CEOs respond to the call for putting their information up in public,” Sebelius said. “Put it on a Web site, tell us what your loss trends are, tell us what you’re paying out, tell us what you’re spending in overhead and CEO salaries and advertising.”

The CEOs of the nation’s two largest managed-care companies, WellPoint and UnitedHealth, emphasized other points following the meeting, saying that participants discussed the rising health-care costs that are driving rates higher.

“It was a very constructive engagement” that went beyond “a simplistic focus on insurance premiums alone,” UnitedHealth CEO Stephen Hemsley said. He and WellPoint CEO Angela Braly told reporters there has been a misunderstanding about industry profit margins, which Hemsley said are low compared with the overall health sector.

As for Sebelius’ call for insurers to post rate information online, Hemsley said companies made no formal commitment. “This was an idea that she had offered in the context of the meeting; I think the response to it was constructive,” although it wasn’t a formal enough proposal yet to elicit an official response, Hemsley said.

Braly said insurers will work with the National Association of Insurance Commissioners to provide additional transparency about what goes into rates.

Sebelius and lawmakers have criticized WellPoint’s plans to raise rates for individual Anthem Blue Cross of California members by as much as 39%, with the secretary noting the company posted a $2.7 billion fourth-quarter profit. The administration, which says similar increases are hitting families and business owners across the country, has proposed giving the federal government new powers to stop insurers from raising rates on premiums.

The Illinois Department of Insurance today for the first time posted rate increases for customers who buy individual plans. The rates posted were up 60 percent for base premiums that don’t account for other factors that cause rates to go up such as health status, age and gender.

White House spokesman Robert Gibbs said on his Twitter feed that President Barack Obama dropped in on the meeting after the media had left the room. Gibbs said Obama brought a letter from a woman in Ohio whose insurance will go up 40% next year.

Rate increase proposals are now reviewed by individual states. The president’s proposal, however, would give the federal government the power to review and block premium increases.
Sandy Praeger, Kansas’s insurance commissioner, said the states’ role in rates should be preserved but that a federal backstop is needed.

Aetna CEO Ronald Williams said the insurance sector and the government “share a common goal–making sure working families have access to affordable health care.”

Thursday’s session comes as Obama hopes to propel the debate over health care to a conclusion. He was meeting in the afternoon with group of influential lawmakers to advance his cause.

Tribune staff reporter Bruce Japsen contributed to this story