Senn And Sensibility Insurers Say They’re Being Mistreated; Commissioner Says They’re Being Greedy

The complaints and accusations get louder and louder.

AIDS patients and other sick people flock to Washington to exploit the state’s generous health insurance policies!

Insurance companies are losing $75 million a year and fleeing the state because they can’t afford to do business here any more!

The uproar over Washington’s brewing health insurance crisis is rife with contentious allegations and calls for political surgery.

Just three years ago, the White House heralded the state’s reforms as a national model. What remains of that partially gutted program is increasingly branded as a disaster.

Premiums soared by as much as 34 percent this past year for about 400,000 people with individual insurance policies. The rates could climb again as insurance companies claim they are still losing millions.

State Insurance Commissioner Deborah Senn catches much of the blame for the controversial policies originally designed to make it easier and cheaper for ailing people to buy insurance.

Senn, a feisty mountain climber, says she is faulted for the blunders of the Legislature and the insurance industry. She also says her loudest critics can’t back up claims, and sometimes lie.

The clash is turning the once sleepy insurance commissioner post into one of the state’s highest profile jobs and a pivotal race this election year.

While many insurance executives and brokers privately say Senn doesn’t understand the insurance business, they are reluctant to publicly criticize their regulator. As one put it, that would be as foolish as slamming the IRS.

But Senn isn’t shy to swing at her many foes. In an interview last week, she accused Blue Cross of Washington and Alaska, the state’s biggest health insurer, of creating its own problems and exaggerating its losses.

The truth is elusive. Statistics are disputed. Pinpointing blame is complicated by the many factions involved in shaping insurance policy. For example, Senn implemented most of her changes just before national and state health care reforms unraveled.

With four Republicans lining up for a chance to unseat Democrat Senn this year, the issue will only get hotter.

Here are some of the hot-button controversies and the dueling arguments:

Open enrollment

Executives of the state’s biggest health insurers crowded behind Senn at a news conference two years ago to support a three-month open-enrollment period to allow people to instantly buy insurance regardless of their ailments.

The industry now blames that decision, and the state’s ongoing lenient rules on pre-existing health conditions, for their mounting losses. Insurers can only wait three months, instead of a year, before covering pre-existing medical conditions.

The state’s biggest insurers rankled Senn last year when they demanded big rate hikes for individual policy holders, then sued when she refused.

Group Health Northwest reports that at least a dozen women recently took advantage of the state’s easy insurance access to buy coverage just long enough to pay for having a baby.

Blue Cross says the medical bills for people admitted during the open enrollment period were 70 percent higher than the bills of average policy holders.

Senn says Blue Cross won’t share the numbers with her office to prove that claim. She also says the company’s claims of financial hardship are exaggerated.

“They’re using accounting adjustments to make their losses look larger,” she says, asserting the company unfairly factors in anticipated losses into its current financial operations.

Jack McRae, Blue Cross vice president and spokesman, sounded stunned by Senn’s contention. “That is 100 percent absolutely incorrect. The numbers are very, very obvious.”

Incoming wounded

Senn calls it a myth, an urban legend.

But insurance officials bring it up when they’re talking to newspaper editorial boards, angry policy holders or insurance shoppers.

Sick people are moving to Washington to sign up for health insurance unavailable elsewhere, they say. The result? The cost of insurance is climbing for healthy people.

They roll out the anecdotes. A man flew his ill mother from Tehran to Washington so she could get health insurance. Sick people in neighboring states get Washington post office boxes so they can get insured.

A broker with offices in Oregon and Washington says clients are interested in moving north to get cheaper coverage.

“In Washington, they don’t care if you have AIDS or cancer or if you have one arm chopped off dripping blood,” he says, asking not to be identified. “They don’t care. It’s socialism. It’s forcing on the insurance companies an unreasonable business practice.”

Henry Berman, president of Group Health Northwest in Spokane, says he knows of an Oregon resident who used a relative’s Colville address to try to get insurance.

But Berman says his company doesn’t track the former addresses of policy holders well enough to assess the financial impact of the incoming patients.

Blue Cross tries to quantify the infiltration, stating in a news release that the number of out-of-state enrollees has tripled since the summer of 1994.

Asked to back up the claim with real numbers, Blue Cross’ McRae says the figures actually are not that significant. “I don’t want to emphasize that that’s a huge number,” he says.

Sheryl Hutchison, of the state’s Health Care Policy Board, says insurance officials often tell the board about the invasion.

“All of them will make the claim,” says Hutchison, whose board studies issues and advises the Legislature. “But when you say, ‘Show us your data,’ things fall apart really fast.”

Fleeing companies

Spokane brokers grouse that a few years ago they could offer people more than a dozen individual health insurance policy options. Now they often have only two or three choices.

The shrinking field reflects the fact that many companies choose not to sell new coverage to individuals after the state launched its reforms.

The insurance industry portrays the exodus as an ongoing mutiny that reduces choices for consumers and boosts the cost of insurance.

Senn claims there actually are more companies providing health insurance in the state today than there were in 1994.

She says the 34 companies that decided to leave the state’s health insurance market were mostly “cherry pickers,” providing coverage to only the healthiest 1 percent of the market.

Senn’s critics scoff at her figures and analysis.

“Deborah Senn is lying, or she’s shading the truth,” says her Republican opponent Brian McCulloch. He points to big insurers Senn ignores which he says are trying to flee the state’s health insurance business.

One Washington broker says the state has lost a “lot of the companies that had tremendous policies.”

The broker, who insisted on anonymity for fear of possible retaliation, was asked to name the companies that are badly missed.

“Oh gosh,” he says, then paused and couldn’t name one.

Hutchison, of the state Health Care Policy Board, sums up the controversy this way: “The biggest insurers, the ones who provide 80 to 90 percent of the coverage, are still here.”

Consumer friend or foe?

This growing spat is spilling into the state insurance commissioner campaign.

“She can’t do the numbers,” says Senn’s opponent McCulloch, who has worked in the insurance field for 26 years. “I think she’s the worst insurance commissioner in the history of the nation.”

Others accuse her of advocating a socialist health care agenda. Republican opponent Steve Skipper says Senn doesn’t even understand her job description. “I hate to tell her this, but she’s not in the health care business.’

Skipper calls it inappropriate that Senn is scheduled to speak at a June 22 conference organized by the Single Payer Action Network, an enemy of the insurance industry.

The closing paragraph on the event flier reads: “Of course what we really need is to eliminate the insurance companies entirely from their self-appointed role as financial middlemen of our health care system.”

Skipper says Senn’s participation in the forum shows her bias. “I believe that she thinks the way to protect the consumer is to have the government regulate all areas of insurance and even health care.”

Senn’s campaign aide Brian Carpenter says her opponents “accuse her of everything but the fall of the western civilization.”

Does Senn have any regrets about her adversarial role with the insurance industry, or about her policy decisions? “No,” she says. “Because we have helped people.”

Senn says people often tell her they couldn’t get health insurance before she took office.

“People come up to me in the street and tell me that. People come up to me in restaurants. I’ve had waiters tell me that. I hear it all the time. So, that’s why I believe in what we did.”

, DataTimes ILLUSTRATION: Color Photo