Questions for Anthem before rate hike

Posted Jan. 12, 2010, at 7:52 p.m.

Regarding the Jan. 8 article “Anthem requests 22.9 percent rate hike”: Before Anthem is granted any rate increase, I believe it should be asked a few questions and be forced to practice some transparency in its business.

For instance, for every dollar collected in premiums, how much is used for administrative costs? Specifically, how much is spent on salaries, marketing and “other promotional costs” (and what are those “other” costs)? Not long ago the Bangor Daily News revealed how much the top executives at hospitals in Maine were paid in salary and other compensation. I think all the insurance companies should be forced to practice the same transparency. How much are the CEOs and top vice presidents at Anthem paid? What other compensation do they receive (stock, bonuses, etc.)?

The same questions should be asked of its parent company, WellPoint. How much is its CEO paid, and its top vice presidents? How much has Anthem paid to its parent company in dividends? How much does WellPoint spend on lobbyists each year? What are those lobbyists trying to do with their paid influence in Washington?

What about the quality of service Anthem provides? How does it compare with other insurance companies when it comes to the speed and efficiency with which it pays claims? What is its rate of claim denial? How quickly does it process appeals? What tools does it have available for its customers (individuals, hospitals and doctor’s offices) that help them submit more accurate claims, so that the denial rate and time to payment is reduced?

What about customer satisfaction? Is it using any kind of independent surveys to track customer service and satisfaction? Shouldn’t its request for rate increases be directly tied to the quality of service and customer

satisfaction it provides? This is certainly the trend for hospitals, whose reimbursement is being directly tied to the quality of care they provide. Shouldn’t the same be true for the insurance companies that are pushing this trend?

What efforts has it made at downsizing? Has it laid off employees and tried to consolidate its business? Is it practicing the concept of “doing more with less,” as hospitals have been forced to do? Can it show any kind of concerted effort at streamlining its processes in an effort to create greater efficiency and cost savings that can be passed on to its customers, not just its stockholders?

What kind of annual cost of living raises have its employees received recently? Has it considered freezing wages for a year? Has it thought about reducing employee benefits, or requiring employees to pay a larger portion of the cost of their health care benefits? Would the top 5 percent highest paid executives at Anthem and WellPoint consider cutting their annual salaries by 10 percent or 25 percent or even 50 percent? If they did, how much money could they save their customers?

As someone who works in the health care field, I’ve seen firsthand how hard hospitals are struggling to break even. Staff have been laid off and services have been cut. Employees have to forgo cost-of-living raises, and then are asked to pay a larger share of their health benefits.

The fact that a for-profit insurance company such as Anthem is requesting such a large increase, just so it can continue to make a profit, is outrageous. Before any increase is approved, it should be forced to show what cost-cutting measures it is taking to help improve its own bottom line. If it is unable to show significant improvement by cutting costs, streamlining processes, and creating efficiencies, then it shouldn’t be allowed to gouge the people of Maine.

Steve Votey, of Seal Harbor, is the diagnostic imaging manager at Blue Hill Memorial Hospital.

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