Anthem Proceeds With Premium Hikes Deemed ‘Unreasonable’ by State of CA health insurance

For the first time, the California Department of Managed Health Care DMHC has deemed a health insurance rate hike to be “unreasonable,” but officials did not have the authority to stop an increase for Anthem Blue Cross policyholders from taking effect. The rate hike, which took effect Sunday, affects 120,000 Anthem Blue Cross members with individual policies. The increases range from 14.4% to 16.7%.

Rate Hike Details

On April 7, DMHC requested that Anthem explain why it was moving ahead with a planned May 1 increase for individual PPO policies overseen by DMHC when planned rate increases for similar policies handled by the state Department of Insurance were scaled back. Rate increases for individual policies filed with DMHC are 3% to 4% higher than those of similar plans regulated by the insurance department, according to a DMHC review.

Anthem, State Response

Anthem said the difference in rate hikes reflects different types of benefits, policies and customer costs under the different state regulators.

The health plan also said DMHC appeared to support the increases earlier this year after an independent actuary concluded that the planned rate increases were “not unreasonable or unjustified.”

Lynne Randolph, a spokesperson for DMHC, said the actuary did determine that Anthem’s rates were “not unreasonable or unjustified.” However, she said that the department adjusted its position when the insurer reduced planned increases to about 600,000 policyholders with plans under the insurance department

Legislation To Control Rate Hikes

State lawmakers are considering legislation (AB 52) that would grant the insurance commissioner broader power to regulate rate hikes. Janice Rocco, deputy commissioner of the insurance department, said a hearing in the Assembly appropriations committee is expected on the bill in May

Well, here it is monday may 2nd. I hope everyone in California has health insurance or at least talking about options. Again, please leave me a comment. 🙂

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