California’s largest for-profit health insurer proposes an average rate hike of 18%, but some Anthem customers may see increase of as much as 25% in February.
By Chad Terhune, Los Angeles Times
November 28, 2012
California’s largest for-profit health insurer, Anthem Blue Cross, is seeking to raise rates an average of 18% for more than 630,000 individual policyholders, drawing scrutiny from regulators and the ire of consumers already struggling with soaring premiums.
Some Anthem customers may see rates rise as much as 25% in February under the company’s proposal at a time when medical inflation is running at historic lows nationwide.
The increases are among several others proposed by California insurers, including Aetna Inc. and Health Net Inc. California insurance regulators will take the next month to review whether these rate increases are warranted, but state officials don’t have the authority to reject them for being unreasonable.
California Insurance Commissioner Dave Jones said insurers can expect a thorough review by his agency.
“It’s fair to say policyholders are dismayed time and time again at these rate increases they are forced to pay,” he said.
Anthem customer Ellie Podway, 55, of Pasadena said she and her husband received a letter the day before Thanksgiving informing them of a 14% rate increase to $881 a month, effective in February. Since 2010, Anthem has boosted the couple’s monthly premium 81%, she said.
“This is out of control,” Podway said. “You feel like you’re being sucker punched over and over.”
Anthem, a unit of Indianapolis insurance giant WellPoint Inc., isn’t alone in levying double-digit rate hikes.
Aetna, the nation’s third-largest health insurer, wants to boost premiums 19%, on average, for nearly 70,000 individual customers in California, effective in April. Woodland Hills insurer Health Net raised rates last month 14%, on average, for more than 30,000 individual policyholders and their dependents statewide. Blue Shield of California is expected to file for rate increases for individual customers next week.
Industrywide, health insurers have been helped by historically low increases in medical costs the last few years as consumers postponed doctor’s visits and other care to avoid out-of-pocket expenses in a sluggish economy. U.S. healthcare spending has grown less than 4% annually the last three years, according to government figures, the lowest rates in more than 50 years.
In its rate request, Anthem said its medical costs for this segment of the business are increasing nearly 11% and what it actually pays is rising 13.5% after adjusting for its portion after customer deductibles.
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Dec. 5/12
In Silicon Valley, California, and I’m a Blue Shield PPO policy holder with an “independent” plan. My monthly premiums have risen 77.7 percent over the past 12 months. It shocks everyone, especially my friends and extended family in Canada. I have an individual plan, no dependents, and have no health issues and take no medication. My doctor at PAMF gives my health high marks.
The healthcare providers and insurers are way out of control, and a necessary colonoscopy for those over 50 is a great example for comparison.
My academic background, with an emphasis on white-collar crime, is useful in tagging many outrageous practices that thrive in that punt between healthcare provider and insurer, that is orchestrated to bypass full disclosure to the patient, at the front end. Asking the good, solid questions about billing, before the billable event, usually results in a withering, inadequate response. To my point, it happened again just yesterday afternoon, and I will have to call the clinic tomorrow to get the necessary information that the PA conveniently and dismissively failed to disclose.
As people live longer and healthier, and keep fit and look great well past middle age, healthcare providers and insurers and their actuaries need to progress into a paradigm that rewards great compliance and robust health and fitness, rather than this status quo model that punishes everyone equally, in a homogenized template.
So much for all the industry rhetoric about individualized medicine.
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