Anthem Blue Cross to hit customers with up to 39 percent rate hike in California?
February 9, 2010
(HMG) – You would think business was bad when a company raises it’s rates by up to 39 percent, or 15 times faster than inflation. But that’s what Anthem Blue Cross plans to do to its 800,000 customers in California who hold individual policies, which would take effect on March 1. Upon the news, state regulators almost immediately promised to investigate the increase, while on Monday, the Obama administration got involved with US Health and Human Services Secretary Kathleen Sebelius faxing a letter to Anthem Blue Cross calling for the insurer to publicly explain why it raised premiums.According to Secretary Sebelius, Anthem Blue Cross’s parent company, WellPoint Incorporated earned 2.7 billion dollars in the last quarter of 2009. Additionally, WellPoint CEO Angela Braly earns an annual salary of nearly $10 million and the company spent nearly $9.5 million on lobbying against health reforms in 2009, labor advocate group AFL-CIO noted in a recent release.
Anthem said its costs have been driven up in part because the weak economy has led many people in good health to forgo coverage, leaving those with greater medical needs in its pool of customers. Woodland Hills-based Anthem said it would respond to Sebelius’ request as soon as possible.