Depending on who you believe, health insurance companies are either greedy profit-driven leeches on the American landscape or providers of a critical quality service.

Either way, they’ve got to get paid.

Earlier this year, a spat over insurance giant WellPoint’s proposed 40 percent premium increase inadvertently helped push the new health overhaul law over the finish line. The law, however, to the disappointment of many federal lawmakers, still leaves most direct oversight of premium-setting to the states.

Still, rising premiums, particularly in the short run, are a continuing worry. Democratic lawmakers fear that price hikes will lead people to believe that the new law isn’t working. The insurance industry fears price hikes could lead to more draconian regulation.

In that spirit, the insurance industry trade group America’s Health Insurance Plans called in a handful of reporters this week to walk through the process of how actual premiums are calculated for the individual and small group market.

Warning: It’s pretty wonky.

First, said Tom Wildsmith of the Hay Group, deciding what to charge involves a lot more than just how fast medical prices are rising.

One problem is that insurance companies have no idea who will sign up when they set a premium. “You don’t know if you’re going to get Paris Hilton or John Candy,” he said.

Then there’s the matter of how many services people use. Even if medical prices remain steady, if people use more medical care, premiums have to rise to meet that need. Or, as Wildsmith put it, health insurance “is a buffet, not an iPod.”

Actuaries setting premiums also have to take into account new types of drugs or treatments coming online, and changes in regulations and taxes.

That, he said, is how a year in which the medical inflation rate rises by three or four percentage points can turn into an eight or nine percent premium increase.

How it jumps to 40 percent? He didn’t say.