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Insurance Commissioner Says Anthem Rate Increase Unreasonable

California Insurance Commissioner Dave Jones said a rate increase proposed by Anthem Blue Cross on small employers is unreasonable. He also said the insurer should not charge Affordable Care Act fees in 2013, since the federal government won’t collect that money until 2014.

Anthem’s rate increase would average about ten-point-six percent a year. Jones said it would affect 52,000 members now, but ultimately it would affect nearly a quarter of a million Californians who participate in Anthem’s small group policy.

“Anthem Blue Cross told me that regardless of our conclusion that the rate increase was unreasonable, they were increasing the rates, and they’re free to do so under California law because there is no law that gives the Insurance Commissioner the authority to reject excessive rate hikes,” explained Jones.

But Anthem Blue Cross said the rate hike reflects rising health care costs and would amount to seven and a half percent a year.

Anthem said that’s comparable to increases sought by other insurers.

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Avatar for user 'RegularChristian'

RegularChristian | January 9, 2013 at 8:49 a.m. ― 4 years, 2 months ago

I'm an Anthem Blue Cross individual policy "member" in a PPO family plan with a $5,000 deductible. While our benefits creep go down every year, our premiums go up. This year, just like the last two years, my annual premiums are increasing about 30 percent. It's crazy. We can't sustain it much longer.

I'm hopeful the exchanges that kick-in in 2014 will help keep my premiums in check with good old fashion competition and also slow down the cost of health care on a national level. The only death panels I've seen are the health insurance companies rationing care for their own profit. Why do health insurance companies need CEO's and senior managers earning millions of dollars a year? What's wrong with a decent middle class salary? After watching these companies over the years I've conclude greed has taken them over and they need to be restrained by strict common sense regulations.

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Avatar for user 'JeanMarc'

JeanMarc | January 9, 2013 at 11:45 a.m. ― 4 years, 2 months ago

RegularChristian - Insurance companies are private companies and they may pay their employees however they wish. As a business, their reason for existing is to make money, and that is the driving factor behind any decision they will ever make. They pay CEOs millions of dollars because they want to attract top talent that will steer the company towards profit. A few million is a pittance compared to the billions these guys make for the company. To say greed has taken over seems... naive? Greed is the reason these companies were founded.

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Avatar for user 'RegularChristian'

RegularChristian | January 9, 2013 at 5:18 p.m. ― 4 years, 2 months ago

JeanMarc, Greed is not a virtue, much less a driver of progress. It's a self-destructive instinct that needs to be checked for the general good. Ever heard of the general good? It sounds like you're a Libertarian. I am not. I wholeheartedly support the free market but I have been around long enough to know that Libertarianism, like communism, is great in theory but disastrous in practice. Health care is not a way to maximize shareholder value. It's a pool to mitigate risk. That's all. By the way, most CEO's I know don't take away from R&D, expansions and shareholders by stuffing their pockets. They are prudent people who appreciate good regulation.

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Avatar for user 'JeanMarc'

JeanMarc | January 9, 2013 at 6:34 p.m. ― 4 years, 2 months ago

CEOs exist to maximize shareholder value. Healthcare companies, and all other businesses besides charities and non-profits exist to make money or maximize shareholder value. I suppose we should replace "greed" with "profit" in my last sentence above. No one starts a business to help people, they do it to make money. I know it sounds terrible but it's true.

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Avatar for user 'benz72'

benz72 | January 10, 2013 at 7:50 a.m. ― 4 years, 2 months ago

Making money is good (call it greed or profit as you like, but either way it is good). Fraud is bad. If you have been denied coverage you actually paid for, seek a better resolution. If your current coverage isn't sufficient, increase your coverage. Costs of lots of things change over time. That is the nature of markets.

As a curiosity, what sort of R&D do you imagine insurers are funding?

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