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Blue Shield California Cancels Rate Hikes

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Drastic rate hikes will not be implemented for 340,000 Blue Shield of California members.

Blue Shield of California withdrew its rate-increase request from the California Department of Insurance today.

The non-profit, health-insurance giant was heavily criticized for its request in January to raise individual premiums by as much as 59 percent.

Tom Epstein of Blue Shield of California said the decision to stop the rate increase was in the interest of cost-reduction and support of health-care reform.

“We felt by eliminating the rate increase we would be fulfilling our mission and help advance health reform by focusing on reducing costs over the long term,” said Epstein.

He also said keeping the rates the same for the rest of 2011 means the state’s 340,000 members won’t have to pay an estimated $40 million in premium hikes.

“We withdrew the rate filing because we wanted to give our members the most affordable coverage we could -- we wanted to put the debate about the rate increase behind us,” Epstein said.

In a written statement, Blue Shield said individual premiums rates will remain the same for the rest of this year, but added they could be raised in 2012.

Editor's Note: A previous version of this story incorrectly stated, based on a company press release, that errors were discovered in Blue Shield's state filings.

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