Anthem proposes 18% rate hike to offset expected losses next year


Anthem Blue Cross has proposed an 18 percent rate hike on more than 630,000 individual members in California as the battle regarding state officials' regulatory authority to approve such increases heats up.

In its rate request, the largest for-profit health insurer in California said it needs to raise rates, some of which would jump by as much as 25 percent, because the profit margin for its individual insurance business is less than 1 percent this year. What's more, Anthem projected that even with these large premium increases, it still will lose money next year, reported the Los Angeles Times.

"We share our members' concerns over the rising cost of healthcare," Anthem Spokesman Darrel Ng said. "The economic downturn continues to lead many healthy individuals to avoid purchasing coverage or to drop coverage altogether, leaving an insured pool that utilizes significantly more services."

However, public advocacy group Consumer Watchdog isn't buying Anthem's arguments. "This is just the latest in a long string of outrageous double-digit rates hikes that Anthem Blue Cross has tried to impose on hundreds of thousands of California policyholders," Consumer Watchdog's Carmen Balber told KPBS. "We find it hard to believe that Anthem Blue Cross, which has a parent company, WellPoint, which is making billions in profits every year, isn't doing well in California."

California Insurance Commissioner Dave Jones will review Anthem's rate request to determine whether it's warranted. Although he lacks the authority to deny the hikes, Jones said his agency will complete a thorough review. "It's fair to say policyholders are dismayed time and time again at these rate increases they are forced to pay," he told the Times.

In addition to Anthem, Aetna and Health Net have both submitted proposed rate hikes for 19 percent and 14 percent, respectively, according to the Associated Press. Blue Shield of California will likely file next week to increase rates for its individual members.

To learn more:
- read the Los Angeles Times article
- check out the KPBS article
- see the Associated Press article

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