E-mails: Patrick team worried about price cap idea

By GLEN JOHNSON

BOSTON

E-mails show the Patrick administration was concerned about news stories and a blog posting critical of a process to cap health insurance premiums in the weeks before it issued its first-ever rejections of small-business premium increases proposed by major Massachusetts insurers.

Hundreds of pages released Tuesday to The Associated Press, following a public records request, show top insurance and regulatory officials circulating a March 8 story from The New York Times questioning the validity of similar proposal on the federal level by the Obama administration.

They also passed around a March 17 op-ed piece from The Boston Globe criticizing the idea. And they shared a March 16 e-mail from a Blue Cross Blue Shield executive who offered up a hospital executive's blog posting also critical of the idea.

On April 1, the administration rejected a series of increases proposed by the insurers.

Gov. Deval Patrick has said he's trying to hold down costs for businesses with up to 50 employees, saying unchecked premium growth is sapping their profits and discouraging them from adding workers who could boost the state's economic recovery.

But the insurers say they are being victimized as the Democrat seeks re-election against Republican Charles Baker -- a former health care executive whose stewardship of Harvard Pilgrim Health Care has been vilified by Patrick's team. The insurers argue that unilaterally capping the rates they charge consumers, without capping the rates doctors, hospitals and other providers charge them for their services, puts them on a path to insolvency.

Previous e-mails released to the AP showed a top Division of Insurance official criticizing the cap plan on April 6, saying it could cripple the insurers financially and would most likely cause "a train wreck" within the industry.

The new batch of e-mails includes a Times story making the same point under the headline, "State insurance experts see flaw in Obama's plan to curb health premiums."

E-mails about the story were exchanged between Insurance Commissioner Joseph Murphy and his boss, Consumer Affairs Secretary Barbara Anthony, as she sought clarification about how many states required insurers to submit their rate increases for review before enacting them.

On March 17, Patrick's press secretary, Juan Martinez, also asked top administration aides for a rebuttal to a Globe op-ed piece written by Michael Widmer, president of the Massachusetts Taxpayers Foundation. Widmer wrote that while some small businesses had been hit with premium increases of up to 50 percent, official state data showed their average hikes were only slightly larger than increases levied on mid- and large-size companies.

"We'd like to provide the governor with a point-by-point rebuttal to it this morning before his first press availability," Martinez wrote to Murphy, the insurance chief, and Health and Human Services Secretary Judyann Bigby.

Bigby replied that she and her staff would do so, adding that she thought they had the most recent small business rate increases, which she said Widmer would not have had.

Throughout the remainder of the day, Martinez, Murphy, Bigby and David Morales, a former top Patrick gubernatorial and political aide now serving as commissioner of the state's Division of Health Care Finance and Policy, traded drafts of a Letter to the Editor responding to Widmer's column.

A day earlier, Murphy also sent Anthony and other state officials a copy of a blog posting from Paul Levy, chief executive officer of Beth Israel Deaconess Medical Center in Boston.

He wrote of premium caps, "This kind of piecemeal approach to regulation is ill-advised."

The blog posting was forwarded to Murphy by Jay Curley, chief government affairs official at Blue Cross Blue Shield of Massachusetts.