WASHINGTON -- Insurance company executives on Thursday, Sept. 17, assured a skeptical congressional subcommittee chaired by Cleveland Democratic Rep. Dennis Kucinich that their coverage decisions are motivated by patient care, not profits.

One after another, representatives of Aetna, United Healthcare, WellPoint Inc., Humana, CIGNA, and Health Care Service Corp. denied their companies cut costs by routinely rejecting claims, or that they rescind insurance coverage for patients and employers who incur major medical expenses.

"Private health insurers are insuring fewer people and earning higher profits, by avoiding providing coverage to people who get very sick and who have very high medical bills -- that's what Wall Street wants to see," insisted Kucinich, whose Domestic Policy Subcommittee heard testimony Wednesday from former insurance company employees and relatives of patients who maintained that was the case.

Insurance company officials summoned for Day Two of Kucinich's hearings explained it differently.

"Health care costs drive insurance premiums, not the other way around," declared Aetna Inc. Senior Vice President Patricia Farrell. "Over the last decade, health care costs have risen about 7.7 percent a year on average, and insurance premiums have risen that very same amount."

Brian Sassi, who heads Wellpoint Inc.'s consumer business unit, cited an insurance industry study that said companies typically pay out 87 cents of every premium dollar to cover claims, while just three cents goes to profit. He said 6 cents goes to taxes and administrative costs while 4 cents goes to services like disease prevention, provider support and marketing.

One percent of WellPoint's members account for 25 percent of medical costs paid out by the company, he said, and 5 percent drive 50 percent of costs. Most have severe chronic illnesses.

"Our goal is to help these members manage their conditions and prevent their illnesses from progressing to a more advanced stage," Sassi said.

When Kucinich inquired about multimillion-dollar fines that WellPoint paid in California for rescinding coverage to patients who incurred significant medical bills, Sassi said the policies were actually canceled because those customers lied on their coverage applications.

"We never drop a member because of an increase in their medical costs," said Aetna's Farrell.

Insurance industry representatives said they oppose establishing a public health care option.

They said that because the current Medicare and Medicaid public insurance programs don't reimburse health care providers sufficiently to cover expenses, extra costs amounting to $88 billion each year are passed along to the privately insured, which adds an extra $1,500 in yearly premium costs for a family of four. More people enrolled in public insurance would force the privately insured to absorb more costs and make private insurance less competitive.

When Rep. John Conyers, Democrat of Michigan accused the insurers of not wanting competition from a public plan, Sassi replied that 1,300 insurers around the country compete for business with each other.

"Our concern is that when the government comes in and has ability to set reimbursement rates, it creates an unlevel playing field that can reduce choice for the American public," Sassi said.