We turn to the growing outrage at insurance companies, the ones that raise premiums on ordinary Americans while racking up big profits. Today, executives of the company that insures the most Americans had to answer for big bonuses and lavish retreats while socking clients with a double-digit increase in fees.ABC viewers were treated to demagogic Democrats railing against the salaries and profits of WellPoint. Then, as if it were a coincidence, Sawyer acknowledged “this anger erupts on the eve of President Obama's health care reform summit tomorrow.” (NBC also ran a story pegged to the House Energy and Commerce Committee hearing, but sans the histrionics.)
Over on CBS, Katie Couric insisted Thursday would bring “that much-anticipated summit at the White House” to “try to save health care reform.” She began with “shades of the Paris peace talks,” ruing “Republicans have been arguing about the shape of the table and the seating arrangement.” Getting to the substance, Couric pleaded: “Does the President have any chance of reaching some kind of compromise with Republicans on health care reform?”
From Wednesday night, February 24:
ABC’s World News:
DIANE SAWYER, IN OPENING TEASER: Tonight on World News, feeling the heat. Big insurance executives forced to answer why they're raising your premiums while raking in big profits.CBS Evening News:
DIANE SAWYER: And now we turn to the growing outrage at insurance companies, the ones that raise premiums on ordinary Americans while racking up big profits. Today, executives of the company that insures the most Americans had to answer for big bonuses and lavish retreats while socking clients with a double-digit increase in fees. And Jon Karl tells us about that highly charged hearing. Jon?
JONATHAN KARL: Julie Hendrickson, a self-employed mother of two, got a letter from WellPoint saying her premium was going up $310 a month.
JULIE HENDRICKSON, WELLPOINT CUSTOMER: In this economically depressed environment, I find the act of raising premium costs to individual policy holders for such high amounts truly unconscionable.
KARL: She's not alone. A study released today shows WellPoint is now pushing double digit premium hikes in at least 11 states. When WellPoint’s CEO appeared, it quickly got personal.
REP. JAN SCHAKOWSKY (D-IL): How much money do you make?
ANGELA BRALY, CEO, WELLPOINT: My salary is $1.1 million. I received stock compensation with a value of $8.5 million, and last year an annual incentive payment of $73,000.
SCHAKOWSKY: Well, of course, it makes sense, then, that you would need a big rate increase.
KARL: The committee also took aim at WellPoint's record profit last year.
REP. BART STUPAK (D-MI): I don't mind you making a profit , but at the end of the year, 2009, a horrible year, you still made two point something billion dollars, and that's not enough?
KARL: Actually, the company’s profits were $4.7 billion, in part because it sold a subsidiary. In each of the last five years, WellPoint's profits have exceeded $2 billion. The company says its profit margin, about 5 percent, is reasonable.
BRALY: Insurance industry margins are dwarfed by the margins of others in health care.
KARL: WellPoint’s profit margin was far lower than most pharmaceutical companies and biotech firms.
CYNTHIA MILLER, WELLPOINT: We don't like raising our rates that much. We know it's a hardship on these people.
KARL: But an e-mail from WellPoint's chief actuary suggests the company is pushing a rate hike in California to achieve, quote, “target profit of seven percent versus five percent this year.” Documents obtained by the committee also show WellPoint spent $27 million in 2007 and 2008 on company retreats.
SCHAKOWSKY: These retreats hold more sway with your company than the health and wellbeing of your subscribers.
KARL: WellPoint's CEO says she does care about her policy holders.
BRALY: We are on their side. We want to-
SCHAKOWSKY: They don't feel like it.
KARL: The Obama administration also wants to hear from WellPoint. Today, the Health and Human Services Secretary invited the CEOs of all of the top five health insurance companies in the United States to come to Washington, Diane, to talk about those premium hikes.
SAWYER: So the pressure is on. And, Jon, as you know well, this anger erupts on the eve of President Obama's health care reform summit tomorrow. After this year of deadlock and division, Republicans and Democrats will gather together, and some say the future of health care reform in this administration could be at stake. Jake Tapper at the White House, and, Jake, nothing is being left to chance at this meeting...
KATIE COURIC: And looking ahead to tomorrow, that much-anticipated summit at the White House. The President is gathering House and Senate leaders -- Democrats and Republicans -- to try to save health care reform. Nancy Cordes is our congressional correspondent and, Nancy, shades of the Paris peace talks that Republicans have been arguing about the shape of the table and the seating arrangement. What's that all about?
NANCY CORDES: That's right, Katie. They want to avoid giving the President the upper hand so first they said they didn't want him standing at a podium tomorrow where he might lecture them like Professor Obama. And then, when the White House wanted the table that everyone would sit at to look something like this with the President sitting at the center, the Republicans said no, the table should look more like this where everyone would be a bit more equal and the White House said okay.
COURIC: So now that's settled. What about the really big issues? Does the President have any chance of reaching some kind of compromise with Republicans on health care reform?
CORDES: Well, that's looking a lot less likely, Katie. In fact, just a few moments ago I asked the Republican leader Mitch McConnell whether there was any chance for compromise given the fact the President was unlikely to heed his demands that they scrap the entire Democratic bill and start over.
McCONNEL: Unless they're willing to do that, I think it's nearly impossible to imagine a scenario under which we could reach an agreement.
CORDES: So the White House is less focused on this point at winning over the Republicans and it's more focused on winning over wavering Democrats who will all have to hang together, Katie, if they're finally going to pass a health care bill.