Senators are taking action in investigating aspects of health care reform, whether turning attention to particular issues, or questioning effectiveness. Senate Committee on Commerce, Science & Transportation Chairman John D. Rockefeller (D-WV) is continuing his work on accountability in health insurance companies, expanding his investigations into industry policies covering medically necessary care.

Rockefeller has sent letters to the CEOs of the companies Coventry Health Care and Aetna, Inc., in which he requested detailed information concerning policies covering stress tests for their Delaware policyholders who are showing symptoms of heart disease. This action follows reports in Delaware media that insurers are refusing to cover these tests, and that Delaware Insurance Commissioner Karen Weldin Stewart is examining the matter.

"I am encouraged that Commissioner Stewart has launched an investigation into BCBSD's, Aetna's and Coventry's health care practices," Chairman Rockefeller said. "I intend to keep a close watch on the health insurance industry, and to ask the tough questions about how they do business - especially now that we have passed a landmark health care reform bill. Denying medically necessary services to patients showing signs of serious heart disease is not tolerable."

In addition, Chairman Rockefeller's staff has released a report on 2009 medical loss ratio information for policymakers and consumers. As explained in the report, a medical loss ratio is an important aspect of the commercial health insurance industry because the ratio measures the percentage of premium dollars actually spent on health care, as opposed to, for example, administrative costs or advertising costs. If a company uses 80 cents out of every premium dollar for health care, its medical loss ratio is 80 percent. Many States require minimum loss ratios for insurers.

For this report, Chairman Rockefeller had sent letters to the 15 largest health insurers asking for more information on the company's medical loss ratios; however, the report notes that many of these companies responded that the requested medical loss ratio information, categorized by state and market segment, was "proprietary" and "business sensitive." The report said this response was troubling, as the information is useful for consumers purchasing insurance.

The Committee then collected background information for the report from 2008 "Accident & Health Policy Experience Exhibit" forms the insurance companies filed with the National Association of Insurance Commissioners. The Committee's analysis found that the largest for-profit health insurers had a lower medical loss ratio than other health insurers, spending less premium dollars on health care. In addition, for individual and small group markets, health insurers have a smaller medical loss ratio than they do in the large group market.

In the health care reform law, there are new minimum medical loss ratios. The staff report indicates that the insurance industry is dealing with the impact of the new minimum medical loss ratio requirements, and some might shift administrative expenses to the category of medical expenses.

Chairman Rockefeller said about the report, "Given the industry's track record, the Commerce Committee will continue to monitor medical loss ratios for as long as necessary. And consumers can rest assured that our watchful eye will require health insurance companies to comply with the law by actually spending more money on patient care - not doing all they can to cut corners and cook the books."

Meanwhile, the House Energy and Commerce Committee canceled a hearing on health care reform and its effect upon large employers. The Hearing was to be held April 21. Chairs Rep. Henry Waxman (D-CA) and Rep. Bart Stupak (D-MI) stated in a letter to the Members of the Subcommittee on Oversight and Investigation that the cancellation is due to the request of several companies who had been invited to testify. These companies had asked for more time for the reform implementation to be performed before holding a hearing.

Waxman and Stupak state that several companies and their representatives feel that the new law "could have beneficial impacts on large employers if implemented properly." For example, John Castellani, president of the Business Roundtable, told the subcommittee's staff, "if implemented right, the law has the potential to make employers and employees better off because it could bend the cost curve."

Waxman and Stupak also note that the companies have acknowledged that they will be affected by many of the new law's provisions, some of which impose costs, e.g. ending the tax deductibility of the government subsidy for providing retiree prescription drug coverage. Other provisions, such as the coverage of the uninsured, may reduce employer health care costs. But in general, the stakeholder companies and associations don't feel at this time that they can accurately weigh the benefits and detriments of the law.

Waxman and Stupak conclude that the subcommittee will "closely monitor the implementation of the new law and will schedule hearings on the impact of the law as appropriate."

Finally, Senator John McCain (R-AZ) and other Senators are asking the Department of Health and Human Services' Inspector General Daniel R. Levinson some pointed questions regarding the potential for fraud and abuse in the new health care reform law. In a letter to Levinson, the Senators state, "We are gravely concerned that the loss and abuse of taxpayer dollars due to waste and fraud could increase under the new health law. We believe this concern is well placed, as our largest federal health care programs, Medicare and Medicaid, are already rife with waste fraud and abuse."

The Senators say that because the new law expands Medicaid and changes Medicare, with new mandates and regulations, the expansion will create new vulnerabilities to waste, fraud and abuse. The Senators are submitting questions to Levinson for his review and response:

--Does the new health reform law fully and effectively implement all the strategies and recommendations Levinson's office identified in earlier Senate Finance Committee testimony for eliminating fraud, waste and abuse in the health care system?

--Do the provisions in the new law designed to combat waste, fraud and abuse represent a fundamental change in the "pay and chase" culture in Medicare, and do the law's anti-fraud provisions largely represent a continuation of the "current post-incident, enforcement driven culture in Medicare and Medicaid?"

--What fraud or exploitation does Levinson see in the new State Exchanges and subsidy arrangements for fraud, waste and abuse? Are there coordination issues that could make the mechanisms vulnerable?

--Does Levinson believe that the new law contains sufficient reforms to prevent fraud, waste and abuse in the current Medicaid program; and are there any reforms to address the high improper payment rates in the program?

--What steps could federal officers/agencies take to share Medicare and Medicaid data to reduce waste, fraud and abuse?

--and finally, what further recommendations or strategies for combating waste, fraud, and abuse in public health care programs does Levinson think Congress should review and consider?

Adapted in part from press releases from the Senate Committee on Commerce, Science & Transportation.

The Senate Committee on Commerce, Science& Transportation press releases: http://commerce.senate.gov/public/index.cfm?p=PressReleases&ContentRecord_id=0244e1ad-f4aa-4b8e-a4f4-d93a34b5ed2b

http://commerce.senate.gov/public/index.cfm?p=PressReleases&ContentRecord_id=c9a3b9b4-175f-4b71-9086-a080e2b08480&ContentType_id=77eb43da-aa94-497d-a73f-5c951ff72372&Group_id=4b968841-f3e8-49da-a529-7b18e32fd69d

The Committee's Report: http://commerce.senate.gov/public/index.cfm?p=Reports&ContentRecord_id=a42d2ec1-3020-4d10-852d-543c5b4390d6&ContentType_id=6a6fef64-34f1-4348-b965-ec03a1dcadfe&Group_id=a89b0b93-3242-4d2a-82da-5e916a62b6a9

Rep. Waxman and Stupak's memo: http://energycommerce.house.gov/Press_111/20100414/memo-2.oi.2010.04.14.pdf

Senator McCain's letter: http://mccain.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=3fb2b0ea-e068-453a-bf56-927d75dc1ef7