Obama targets insurers, sells reform plan

WASHINGTON Mon Mar 8, 2010 5:59pm EST

President Obama delivers remarks on health insurance reform at Arcadia University in Glenside, Pennsylvania, March 8, 2010. REUTERS/Jim Young

President Obama delivers remarks on health insurance reform at Arcadia University in Glenside, Pennsylvania, March 8, 2010.

Credit: Reuters/Jim Young

WASHINGTON (Reuters) - President Barack Obama launched a sharp attack on health insurers on Monday and called on his fellow Democrats to rise above politics and pass a healthcare overhaul in the next few weeks.

Hitting the road to rally support in the final push for healthcare reform, Obama used a campaign-style speech to urge Democrats to approve a bill and quickly end the political wrangling that has consumed Washington since July.

"There have been plenty of folks in Washington who have said that the politics is just too hard. They've argued now is not the time for reform," Obama said at Arcadia University in Glenside, Pennsylvania.

"My question to them is: When is the right time? If not now, when?" he asked, shrugging off warnings of a political backlash in November for Democrats who back the overhaul.

"I don't know how passing healthcare will play politically, but I do know that it's the right thing to do," he said.

Obama also offered his toughest criticism yet of a health insurance industry that he said placed profits ahead of patients. "Every year, they raise premiums higher and higher," Obama said "They will keep doing this for as long as they can get away with it."

Turning up the heat, Health Secretary Kathleen Sebelius sent a letter to top companies such as Aetna Inc and Wellpoint Inc asking them to justify rate increases by making public information about costs, enrollment changes and other details.

"It's time for these insurance company CEOs to do their part to make the system more transparent for the American people," Sebelius said. "If insurance companies are going to raise rates, the least they can do is tell us why."

The Obama administration has targeted health insurers in its final push for an overhaul designed to rein in costs, regulate insurers and expand coverage to tens of millions of Americans.

Obama said failure to pass a healthcare overhaul this year would leave intact a broken $2.5 trillion healthcare system that is ravaged by greedy health insurers.

INSURERS MAKE 'A CALCULATION'

"These insurance companies have made a calculation," Obama said "They're OK with people being priced out of health insurance because they'll still make more by raising premiums on the customers they keep.

The House of Representatives is expected to vote by the end of March on the Senate's version of the healthcare bill, with Democratic House Speaker Nancy Pelosi searching for the 216 votes to pass it. The House approved its version with only three votes to spare in November.

Republican leaders say they will make healthcare reform a top issue in November's elections and urged Republican candidates to focus on the Democratic-crafted bills, which polls show are unpopular with the public.

"A vote for this bill opens an entirely new line of attack on House Democrats," Johnny Destefano, a House Republican campaign committee official, said in a memo to Republican House candidates.

"Now is the time to apply pressure and force your opponents into taking a stand on whether they will walk Speaker Pelosi's plank by supporting her last-ditch healthcare push," he said.

Republican Senate leader Mitch McConnell said the new push on healthcare would be a replay of the frantic maneuvering that marked Senate passage just before Christmas.

"Americans don't like this bill any more today than they did three months ago," he said.

But in Pennsylvania, Obama sought the public's help in rallying Congress to pass the overhaul. "It's time to make a decision," Obama said. "The time for talk is over."

The overhaul looked dead in January when Republicans deprived Democrats of their crucial 60th Senate vote by winning a Massachusetts special election, stopping negotiations to merge bills already passed by the House and Senate.

But changes to the Senate bill sought by Obama and House Democrats will be considered separately using a procedure that allows a majority vote in the 100-member Senate rather than the 60 votes needed to clear Republican procedural hurdles.

Obama proposed revisions to the Senate bill last week to ease the concerns of House Democrats, including watering down a tax on expensive insurance plans and boosting federal subsidies to make coverage more affordable.

"I think there's a lot more determination in the Congress now to get it passed," Democratic Senator Arlen Specter of Pennsylvania told reporters after Obama's speech.

"I really think there's sort of reaction on the Democratic side of getting a little angry over the duration and intensity of obstruction and a lot more determination to see it through."

In her letter to insurers, Sebelius asked executives to post on their websites the justification for any individual or small group rate increases they implemented or proposed in 2010, and continue to do so in the future.

The heads of Cigna Corp, UnitedHealth Group Inc and privately held Health Care Service Corp also received the letter.

Health insurer shares were down for the day. The Morgan Stanley Healthcare Payor index was down about 0.4 percent and the S&P Managed Health Care index was off 1 percent.

The CEO of Manpower, a global employment services company that provides temporary workers, said the uncertainty of the healthcare debate in Washington was keeping U.S. employers from hiring.

"The concern is that we have a political system that is too broken to fix systemic issues," CEO Jeff Joerres told Reuters.

(Additional reporting by Matt Spetalnick, Caren Bohan, Nick Zieminski; editing by David Alexander and Chris Wilson.)