By Amy Goldstein and Scott Wilson
Washington Post Staff Writer
Tuesday, March 9, 2010; A01
The White House is mounting a stinging, sustained broadside against health insurance rate increases as President Obama and his aides enter what they hope will be the final stretch of a year-long political war over health-care reform.
Obama and his health secretary staged a two-pronged attack Monday in a stern letter to health insurance chief executives and a speech in which the president castigated insurance companies 22 times. "How much higher do premiums have to rise," he demanded, "before we do something about it?"
The messages are part of a strategy that Obama and those around him have begun to employ lately, to ratchet up the pace and the populist appeal of their rhetoric against the health insurance industry. The barbed tone moves far beyond that of the 2008 presidential campaign, when Obama began to say that medical coverage should be accessible and affordable for more Americans.
It remains unclear whether the strategy, coming this late in the debate, will mobilize support among the public and on Capitol Hill for the legislation that the White House and congressional Democrats favor. Obama has asked Congress to conduct final votes on the proposal within 10 days, before lawmakers leave for a two-week break. Democratic congressional leaders, especially those in the House, are struggling to secure enough votes within their party; Republicans are calling for the proposal to be abandoned, saying that most Americans oppose it.
The near-daily demonization of the insurance industry is an attempt by the White House to play to Americans' anxieties about the health-care system -- and about the prospect of changing it.
Polls consistently show that most people fear that the legislation would make their treatment more expensive. By focusing on escalating insurance rates, especially for the sliver of the market in which people buy health coverage individually, the administration is emphasizing that costs will increase if Congress does not act.
"Part of the motivating factor here is letting members of Congress know there's a price to pay for failure," White House Chief of Staff Rahm Emanuel said Monday in an interview. "And for the public, it's important to remind them that there are premium increases of 40 percent for as far as you can see if nothing is done."
Emanuel's figure referred to a recent move by Anthem Blue Cross of California to raise premiums by 39 percent for people who buy individual policies.
As the White House has launched its last-minute public relations blitz, "there could have been no greater gift" than Anthem's proposed rate increase, said Drew E. Altman, president of the Henry J. Kaiser Family Foundation, a nonpartisan health policy and research organization. The Obama administration, Altman said, is "trying to connect better with average people" in terms more concrete than the president used earlier in the debate when he spoke about "bending the curve" of escalating health-care costs and curbing future budget deficits.
Republicans doubt that the rhetoric will work. Linda DiVall, a GOP strategist, said White House officials "are trying to disguise their vulnerability" that the Democrats' approach would not control costs "by hiding behind a greater villain" -- insurance firms.
Last year, premiums for employer-sponsored health insurance rose by an average of 5 percent, while overall prices fell nearly 1 percent, according to Kaiser. Over the previous decade, premiums went up by 131 percent, compared with 28 percent for inflation. The administration contends that the rate increases reflect excessive profits; insurance lobbyists counter that their rates simply mirror underlying increases in prices charged by doctors, hospitals and drug firms.
America's Health Insurance Plans, the industry's main lobby, plans to spend more than $1 million on a nationwide advertising campaign this week to, as one official with the group said, "set the record straight about rising health-care costs."
Americans' attitudes toward health insurance are complex. Broad majorities of insured people say they are satisfied with their coverage, according to Washington Post-ABC News polls. Only one in eight say insurance would improve if the health-care system were changed.
But that relative satisfaction coexists with anxiety. More detailed Kaiser surveys show that two-thirds of insured people say they worry that their insurance or their care will become more expensive -- and nearly half say they have delayed or skipped care because of the cost.
Robert J. Blendon, a Harvard professor who specializes in public opinion on health care, said it may be difficult for the White House to shift Americans' views about reform, with polls showing they have been relatively static since early fall. Still, he said, the administration has reason to focus on insurance rates, because "the president ran saying, 'I am going to lower your costs,' and most people don't believe there is anything in the bill at the moment that would make that happen." In particular, Blendon said, Obama is trying to overcome that perception by proposing a new Health Insurance Rate Authority.
That proposal, however, has encountered skepticism among state insurance commissioners, who regulate the industry. "I do kind of recoil at the word 'authority,' " said Sandy Praeger, chairman of the National Association of Insurance Commissioners' health-care committee and insurance commissioner for Kansas. She said she favors nationwide minimum standards for regulating insurers. But, she said, "I don't know why they need a separate board," adding that she fears that such an authority could lead to federal powers to override state decisions about insurance rates.
Already, 28 states require health insurers to get commissioner approval for rate increases in the small, expensive individual insurance market, and a dozen require companies to file notices of planned increases. Praeger said there is a risk that, if the federal government blocked premium increases that insurers needed to remain solvent, some companies could be unable to pay claims.
Through the increasing din, insurers have been using their own megaphone to try to counteract the White House's messages, saying they are being vilified.
"All health plans are in the same situation in trying to deal with the steadily increasing medical costs in the delivery system, which are not sustainable," an Anthem spokeswoman said last month when the firm agreed to a request by California regulators to postpone its rate increase. Like other insurers, Anthem also said rates are going up for individual insurance because, in the poor economy, healthy people are dropping coverage, leaving a pool of customers who are sicker and more expensive to cover.
A few constituencies are seizing on the administration's heated rhetoric. As many as 5,000 activists, organized by Health Care for America Now, a coalition of labor and other liberal groups, are planning to amass in Washington on Tuesday to stage a "Stop Big Insurance" rally outside a policy forum that America's Health Insurance Plans is sponsoring.
On Monday morning, before she joined Obama on Air Force One for his speech in suburban Philadelphia, Health and Human Services Secretary Kathleen Sebelius wrote to the chief executives of five large insurers she had summoned to the White House last week. Calling the insurance system "broken," her letter urged the companies to post on their Web sites a 10-point explanation of price increases and their impact.
At Arcadia University in Glenside, Pa., on Monday, Obama propelled the message further, citing a recent conference call convened by Goldman Sachs Global Investment Research in which, the president said, an insurance broker said there was so little competition among health insurers that it was worth it for companies to raise premiums, even if they lost customers as a result. He said: We "allow the insurance industry to run wild in the country."
Staff writers Dan Eggen and Michael D. Shear and polling analyst Jennifer Agiesta contributed to this report.