Jones Says New Anthem Rate Increase Is 'Unreasonable'

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During a press conference on Tuesday, California Insurance Commissioner Dave Jones (D) said that Anthem Blue Cross Life and Health Insurance has enacted an "unreasonable" rate increase that will affect more than 250,000 small business policyholders, the Sacramento Bee reports (Glover, Sacramento Bee, 1/9).

State officials do not have the authority to block the increase from taking effect (Terhune, Los Angeles Times, 1/9).

Jones' Comments

Jones said small business policyholders will see an average annual increase of 10.6% under the rate hike that took effect Jan. 1. He said that the average increase over two years will be 19.5% (Sacramento Bee, 1/9).

Jones said that a review of Anthem's rate hike filing showed that the actuarial base was too high and that the increase is "excessive." (Robertson, Sacramento Business Journal, 1/8).

According to Jones, Anthem implemented the hike despite evidence of a "21% return on equity" and the commissioner's personal request to delay the increase.

Anthem's Response

Darrell Ng, an Anthem spokesperson, said the insurer "strongly disagrees" with Jones' findings.

He said that the average increase for about 52,400 policyholders is 6.5%.

According to Ng, the average increase is about 7.5% when benefit changes are considered, with an average increase of 12.1% over two years.

He said that the Department of Insurance apparently combined various policies into one pool and calculated too high of an estimate, the Bee reports (Sacramento Bee, 1/9).

Broadcast Coverage

On Tuesday, Capital Public Radio's "KXJZ News" reported on Jones' comments on the Anthem rate hike (Quinton, "KXJZ News," Capital Public Radio, 1/8).

For more information on Jones' comments on the rate hike, read today's Capitol Desk.

Paul Rosenberger
If you think SAnthem Blue Cross's premium hikes are bad, wait to see what the Obamacare premium rates are when they open the exchanges. Why do you think so many states are opting out of the Obamacare exchange partnership with the Federal Government? Because it's a good deal? If you believe that, it's sure proff that you are one of the "low information" who elected to put Obama back into office and believe his coste stimates. The CBO stated as far back as 2009 that the Obama Adminsitration estimates are way below what it will actually cost, and that the true cost will be more than double what he said it would cost. The actual figure goes from his estimated $800 billion to over $2 TRILLION! Stop your moron bitching and wake up to the true (lack of)cost of Healthcare under Obama! WAKE UP, You've been scammed!!!!!!
Gregory Beamer
Joey, thanks for the tip - I am going to check out Health Net. You are absolutely spot on about what they are doing, and it doesn't make sense. You think they would have a limited low premium plan to attract the younger, healthier crowd - which would pull enough in the door to keep the older crowd's premiums reasonable. Whoever is running their show obviously doesn't have an education in marketing, or the school they went to needs help in the curriculum.
Judith Colson
Since 2010 my individual policy cost has increased from $333 to $652 per month. Additionally, my co-pays on MD office visits and on prescription medications have doubled, and my deductible has increased. I have a health plan, but I can't afford to use it. If I didn't feel sick before, I sure do now. Thank god I become eligible for MediCare in 17 months.
Joey Torcellini
This article is for small businesses. 10.6% doesn't seem too bad compared to my personal high deductible plan that was increased 25% for 2013. The 2012 increase was 21%. I have since canceled my Anthem policy and switched to Health Net, effective Jan 1. For the past 8 years I have been with Anthem, they have never paid one claim on my account. I am trying to understand the logic and timing of Anthem's exorbitant 2013 rate increase. I am sure Anthem is now seeing a flood of healthy customers (like myself) leaving for cheaper insurers. Why chase away all their best customers before 2014, when they will be forced to take everyone? What is the chance all these ex-customers, like myself, will return to Anthem in 2014? Not likely. Since Anthem cannot deny anyone in 2014, why not do everything possible to keep all their current customers, which are the most healthy? They must have made a calculation that a huge rate increase is more profitable than a loss of healthy customers.
Gregory Beamer
Another item no one seems to have an answer to is what happens if you enter a state's exchange, and then you have to relocate to another state? Do you have to apply all over again? Can you be rejected? It is absolutely amazing that our congress and President put a plan in place without full knowledge and consideration of what was in it. Every citizen is going to have to grapple with a system that is not well-designed. Anyone who feels Anthem has a right to hike premiums by these ridiculous percentages is more than welcome to send me a check to cover my additional expenses. Governor Brown said the other day he hoped the government wouldn't pay 100% and then pull back at a later date. Can he read? The ACA dictates in 2017 the government will be looking to the states to support the programs 100%. This is a guy that bought the burrito from the vendor in LA to make a showing, then handed it to his clerk with the camera still on and said "do something with this". Fool.

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