Kreidler accuses Premera of 'stonewalling' on transparency bill

Should policyholders get to see the figures a health-insurance company provides state regulators when it tries to raise its rates?

And if so, when exactly?

Insurance Commissioner Mike Kreidler says he wants to end the "secrecy of health-insurance rates" but can't under the current state law, which protects from public scrutiny the figures and formulas divulged by insurers trying to raise their rates.

That information includes how much money their health plan lost, how much of the proposed rate is going to medical claims, how much is going to administrative costs and how much to profit.

A bill now before the state Legislature would change that, allowing the public to see those numbers. The House may vote on the bill as early as Thursday.

Together, Group Health Cooperative, Regence BlueShield, Premera Blue Cross and their affiliates cover 95 percent of the individuals with private insurance in the state and 91 percent of those with small-group policies.

Group Health Cooperative and Regence support the bill.

But Premera is stonewalling, contends Kreidler, who has called out the company in an open letter to consumers on his office's website.

"Premera only wants you to see the filings once the rates are set," he says.

Premera spokesman Eric Earling says "we share the goal of transparency and greater insight for the public," but believe consumers could be confused if one new rate were sought but a different one approved. It would be better, he says, to wait until after a new rate is set to tell consumers the business realities behind it.

But Kreidler, supported by the other insurers, argues that waiting until a new rate is set continues the secrecy. Kreidler says he's deeply troubled that Premera isn't willing to let its own policyholders see "what's really driving health-care premiums."

Group Health, in a letter to Rep. Eileen Cody, chair of the House Health Care and Wellness committee, said the current system allows "far too much shielding of information on the real costs of care." Disclosure will show consumers that what drives premium increases is the cost and use of health care, wrote Pam MacEwan, Group Health's executive vice president for public affairs and governance.

Regence's CEO, Jonathan Hensley, wrote Cody that the company is committed to increased transparency as a "tool for addressing the inequities and cost drivers that threaten the long-term viability of the system as a whole."

As it stands now, Kreidler's office, after reviewing the figures and formulas received from insurers, approves or rejects requests for new premium rates for small-group and individual insurance.

If an approved new insurance rate causes consumers to squawk — and it often does — there's little Kreidler's office can say beyond assuring angry policyholders that the new rate is justified.

Premera's Earling says his company is perplexed by Kreidler's criticism.

Premera already gives customers a breakdown showing where their health-care dollars go, he says, and has worked with legislators to actually broaden the bill's disclosure requirements.

However, he adds, Premera wants the disclosure to wait until the new rate is effective. Otherwise, Earling says, "market confusion can result" because the rate request filed might not be the one approved.

Kreidler says it's not fair to consumers to give them information after the fact.

"We see no reason for secrecy or the kind of delay that Premera is calling for," he says. "I'd rather see all of the information in consumers' hands as soon as possible. Premera feels that could confuse them — I believe it empowers them."

Carol M. Ostrom: 206-464-2249 or costrom@seattletimes.com