WASHINGTON – Health and Human Services Secretary Kathleen Sebelius has asked the CEOs of top health insurance companies to justify proposed health insurance premium hikes.

In a letter addressed to executives at the UnitedHealth Group, WellPoint, Aetna, the Healthcare Service Corporation and CIGNA HealthCare – with whom she met last week at the White House – she wrote, "...it’s time for these insurance company CEOs to do their part to make the system more transparent for the American people. If insurance companies are going to raise rates, the least they can do is tell us why.”

A recent analysis from Goldman Sachs found that competition in the insurance market is so weak, insurance companies can continue to raise rates even if it means losing customers. The analysis indicates“price competition is down” and “incumbent carriers seem more willing than ever to walk away from existing business.”

“For many families, these high premiums have made health insurance unaffordable. At the same time, these families have heard reports of insurance companies taking in multi-billion dollar profits,” the letter read.

The meeting at the White House discussed the importance of addressing and controlling the underlying cost of healthcare, as well as the need for a larger pool of insured individuals to balance risks. According to reports, It was agreed that all would benefit by making the healthcare system more open and transparent.

Sebelius has asked that insurance companies report:

• Estimates on medical cost and use increases, the assumptions driving these estimates and the basis for those assumptions.
• If premiums increase more than estimated medical costs, a description of what accounts for those differences.
• The number of people who will be receiving premium increases, as well as the number of people who will be receiving different levels of premium increases, further broken down by characteristics including plan type, age and sex.
• Enrollment changes in different plans since last year.
• The number of people on whose experience the rate increase is calculated.
• Any premium rating variation including rating variation by age and health status.
• An affordability plan explaining what the company is doing to improve the affordability of healthcare, and the estimated financial impact of the company's affordability initiatives.
• An explanation of any cost containment or quality improvement efforts made that affect the increase.
• The expected medical loss ratio resulting from any premium increase.
• Information on the percentage of premium revenues spent on medical claims, disease management, quality initiatives, administrative costs, profits and executive salaries broken down at least by market type.