Mitch Daniels’ “fiscal responsibility” doesn’t include checking his math

Is it pride? Ideology? Pandering in pursuit of his ambition?

Whatever the reason, Mitch Daniels is refusing to double-check Anthem’s request to drastically increase health insurance rates for Hoosiers. I guess all that talk about being fiscally responsible is – once again – just talk.

Just last week, Anthem was forced to withdraw their request for a major rate hike in California after "an independent audit determined the company’s justification for raising premiums was based on flawed data." And the mistakes weren’t exactly a matter of opinion – they included basic mathematical errors:

  • Error #1: Double counting of aging in the calculation of underlying medical trend for the projection of total lifetime loss ratio.
  • Error #2: Anthem overstated the initial medical trend used to project claims for September 2009 for known risk factors.

Kathleen Sebelius, Secretary of Health & Human Services, sent a letter to other states where Anthem/Wellpoint operate:

"In light of this recent finding, I urge that, to the extent you have authority to do so, you re-examine any WellPoint rate increases in your state to determine whether any mistaken assumptions similar to those made in California were made in your state," Sebelius wrote to the governors. "Even small errors can mean unaffordable premiums for policyholders."

Replying through his spokesperson, Gov. Daniels declined to check Wellpoint’s math:

"When we feel the need for advice about health-care costs, we won’t start with the people who just passed this disastrously expensive and backward federal legislation," Daniels said in a statement…

(Through my spokesperson, I replied that maybe we shouldn’t be taking advice on health care costs from a man who said back in 1994 that health care costs had peaked. Or who said the Iraq War wouldn’t cost more than $60 billion. Or…)

The timing of this couldn’t look worse for Mitch Daniels – Reps Baron Hill and Andre Carson asked the Centers for Medicare and Medicaid Services to review the costs to Indiana of the recently-passed Affordable Health Care act. Unfortunately for Mitch Daniels, while his talking points on the issue may play well to 2012 Presidential primary voters, they don’t hold up well to the facts. In their report, CMS wrote that “Health insurance reform will bring relief to the Indiana budget.”

Hill and Carson added, in a statement:

“The governor is certainly entitled to his political viewpoints on the health care reform law — and he’s made those opinions very clear,” Hill, D-9th District, said in a statement he issued jointly Thursday with U.S. Rep. Andre Carson, a Democrat who represents the Indianapolis area’s 7th District. “But now that this historic legislation is law, it’s important that Hoosiers have factual, accurate information about the health benefits made available through these new provisions,” the statement said.

Couldn’t have said it better myself.