When Governor-elect Dan Malloy chooses people to head state agencies, one of the closely watched announcements is likely to be for a once-obscure job–the insurance commissioner.
The current commissioner, Thomas Sullivan, has become increasingly visible in the wake of controversial double-digit health insurance rate increases, and his successor is likely to play a more high-profile role as health care reform rolls out, potentially producing significant changes for one of the state’s key industries.
Critics have called for the job to become more consumer-oriented, with a commissioner more willing to take on the insurance industry. Some have suggested that it become an elected position. But others have cautioned that the job should not be politicized, and say that the commissioner’s dual roles–protecting consumers and ensuring that insurance companies remain solvent–make it inevitable that some decisions won’t be popular.
Malloy’s chief of staff-designee, Timothy F. Bannon, who is leading Malloy’s transition team with Lieutenant Governor-elect Nancy Wyman, said he and Malloy have spoken about a profile for the position, but not a specific person to fill it.
The administration will look to the insurance industry as a source of growth for the state’s economy, Bannon said.
“And in saying that, the underlying premise is that it is certainly possible to grow and prosper without doing anything that is adverse to the interests of consumers,” he said.
Bannon signaled that Malloy might fill the job differently than governors have in the past. Previous commissioners have come from the industry, which Bannon said can cause consumers to lose confidence that the commissioner is watching out for them.
“With that in mind, the best person to go into the job might be someone with a strong business background, but not from the insurance industry,” Bannon said.
Bannon cautioned that he does not have a particular person in mind, and that he’s not sure there is someone who meets those criteria and would be just right for the job.
“I’m not saying that someone from the industry wouldn’t be a good candidate,” he said. “But Dan believes that we need to look at all the positions freshly.”
The federal health care reform law increases the responsibilities of state insurance departments, giving insurers new data reporting requirements and, in some states, giving the departments authority over markets they had not previously regulated.
Cristine Vogel, who is leading the state’s health reform implementation effort as a special advisor to Gov. M. Jodi Rell, said the insurance commissioner position itself will not change significantly under the law. But it is becoming more visible, she said.
“Most people didn’t even know their insurance commissioner before health care reform,” Vogel said.
Sullivan, who is leaving the job to take a position in the private sector, came under intense scrutiny in the past year. Critics called for him to lose the job last month after the department approved a series of rate increases for individual-market plans this fall, including a headline-grabbing 47 percent increase for one Anthem Blue Cross and Blue Shield plan that Sullivan and the company attributed largely to the requirements of the health reform law.
One of Sullivan’s critics, Beverley Brakeman, political representative for the United Auto Workers, said the job should be geared more toward consumers.
“You can have an insurance commissioner who is more consumer-oriented and willing to go against the industry a little more,” said Brakeman, who previously served as director of Citizens for Economic Opportunity, the group that called for Sullivan’s ouster.
Brakeman, who serves on the insurance department’s consumer council, was particularly critical of the Anthem rate increases, which she said were approved in a vacuum, with little public oversight.
Brakeman said she hopes the next commissioner can build coalitions and make it easier for consumers to find information from the department. And she hopes the appointee comes from outside the insurance industry.
“We really need an insurance commissioner who’s willing to understand the industry but also willing to push back a little bit,” she said.
Ideally, Brakeman said, the commissioner should be an elected position, although she acknowledged that that was unlikely to happen. As an alternative, she said, the healthcare advocate could be given a larger role to represent consumers.
But George Reider, who served as insurance commissioner during the Rowland administration, said it is critical that the insurance commissioner position remain nonpolitical.
“It’s not a political office,” Reider said. “The biggest mistake would be to politicize the office of the commissioner of insurance.”
In following the job’s dual responsibilities–protecting consumers from potential abuses and making sure insurers have enough money to pay claims–the commissioner might make decisions that are unpopular, Reider said.
“Not all decisions are going to be popular decisions,” Reider said. “If a company can demonstrate that they require a certain premium level in order to maintain their financial strength and it’s reasonable, it’s not taking advantage or allowing for excess profits or anything of that nature, then a commissioner has to make a decision accordingly.”
“Any competent person appointed to that position committed to fulfilling the duties of the office can do a very effective job, but they’re not always going to be agreed with,” he said. “You just know the nature of it is that you’re going to be criticized even if you have made the appropriate decision.”
Reider said it’s important for a commissioner to be able to communicate well and let people understand the factors behind his or her decisions. There’s a risk, he said, of decisions being made to mollify public opinion.
“I do think the danger is that suddenly it’s based on headlines, and that’s not the basis of an insurance department’s decision,” he said. “It has to be based on the facts, and if there’s some disagreement, sometimes you just have to take the heat for that.”