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Anthem Blue Cross Sued Over Rate Increases
A consumer group filed a lawsuit Monday against Anthem Blue Cross, accusing the insurer of raising rates to force members into policies with higher deductibles and lower benefits.
In this Oct. 27, 2003 file photo, employees enter the headquarters of Anthem Inc. in Indianapolis. Anthem Blue Cross, a subsidiary of WellPoint Inc., has been under fire for a week from regulators and politicians for notifying some of its 800,000 individual policyholders in California that it plans to raise rates by up to 39 percent March 1. (AP Photo/Darron Cummings, File) Consumer Watchdog accuses Anthem of violating state law by failing to offer policyholders comparable coverage and minimize rate hikes after the company directs customers to alternative plans when closing out existing plans.
San Rafael resident Mary McNamara Feller, a plaintiff in the suit, which was filed in Ventura County, said she had to do something after Anthem last month proposed raising rates on the policy covering her and her husband nearly 39 percent to $1,658 a month.
She said the company offered her the option of switching to a policy with a higher deductible and skimpier benefits by a specific deadline, but also told her she could stay in her current policy. The company notified her of the enormous premium increases in her plan after the deadline had passed.
"It just seems like there's no end in sight," said Feller, 56, adding that she experienced a similar increase last year. "The way Blue Cross handles this is by forcing plan members into plans that increasingly put people at risk financially. ... It's no longer just about us. It's about 800,000 people who don't have any recourse."
Anthem, which is owned by WellPoint Inc., has come under state and federal scrutiny for hiking the rates of its 800,000 individual policyholders, or those not covered through a group plan, by as much as 39 percent. The increases were scheduled to take effect Monday, but the company agreed to delay them until May 1 to allow the state time to investigate.
California authorities have little power over rates, but Consumer Watchdog's lawsuit relies on a 1993 state law that requires an insurer to offer enrollees a comparable alternative plan.
The suit accuses Anthem of forcing older and sicker members, who are unable to switch carriers, to pay higher and higher premiums until they accept inferior coverage or drop coverage altogether.
"Either way, Anthem wins," said Jerry Flanagan, Consumer Watchdog's health policy director.
Anthem officials said they had not seen the lawsuit and could not comment.
This is not the first lawsuit filed over Anthem's rate hikes. On Feb. 11, Burlingame attorney Ron Galasi, an Anthem customer, filed a lawsuit in San Mateo County Superior Court, accusing the insurer of unfair competitive business practices.
"I want to show this corporation, whether we win or lose, we're not going to let them walk over us anymore," Galasi said.
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18 Comments so far
Show AllThey also need to look at their outrageous patterns of rate increases that has been going on for the LAST 4 YEARS--at 20-30% each year! Those increases should be clawed back and redistributed to the policy holders.
Too bad Arnold the Governator vetoed the California Legislature's attempt to introduce single-payer in California.
A lot of people who can no longer afford their policies with A-BCBS will die before that company is held to any sort of accounting.
Then to ad insult to injury, if they loose the suit they will claim they need to raise rates to pay for the money they lost in the law suit.
The high rates are not the only problem. They also don't pay when you're sick.
Both my older sister and I are retired and on medicare. We both have supplemental insurance from Anthem Blue Cross Blue Shield. Three years ago, my sister had a stroke and spent about six weeks in rehab. The facility assured us that supplemental insurance would cover what medicare didn't cover. Anthem covered very little. My sister tried to call and find out why without success. I kept calling until I got a human on the phone and was giving an entirely unsatisfactory explanation - something about deciding on a case by case basis.
My supplemental costs $2400 per year. So what does it cover? I have no idea.
My comment has been in "edit" mode for over a day. Does replying to it cause it to show up?
"Anthem last month proposed raising rates on the policy covering her and her husband nearly 39 percent to $1,658 a month"
Almost $10k/year per person for health insurance? This would have been unacceptable, even in the USA, ten years ago.
The only reason USans accept it today is because the media assigned them to play the role of Docile Subjects to the Empire Elites.
And given the obviously extreme psychosis of the Empire Elites, this means USan frogs are in a pot of increasingly hot water.
They can't believe "dear leaders" would treat them so badly. After all, "dear leaders" have promised to protect them from the "external threats".
We all remember the warm fuzzy feeling the Imperial Chimp gave to us in his post 9/11 speeechies. We want to maintain those warm fuzzies ehh? NOT
USans pay TWICE what others pay for healthcare. USans also pay twice what others pay for education and transport. And far more for DEFENZ. Sure, much of the munny churns back around to us, as many of us are employed in these rackets. However we COULD and we MUST re-employ ourselves in occupations that TRULY benefit ourselves.
For example, organic farming. Would someone please grow some hemp and make me some clothes? So instead of participating in the rackets of plunder, we can participate in the alternatives, first by DEMANDING the alternatives, then SUPPLYING them in local closed markets, leaving the Empire Elites out.
Frivolous lawsuits again, eh? Tort reform is the answer. Varmit special interests meddling with insurance.
Big Insurance has all the money to show up in court for what they did wrong. Tort reform is not the answer.
MoveOn has an idea that is a step in the right direction. There will be a group of people attempting to make mass citizen's arrests of the insurance executives for violating state law for raising rates as they arrive for their meeting in DC on March 9.
Good luck.
The only solutions is to shut down the insurance companies and banks, take their money, put their executives in jail for racketeering and murder, confiscate all their money, houses, offshore accounts, possessions and use the money to fund healthcare for all.
I like your plan!
There is only one way to teach these people a lesson and that is for everyone and I mean everyone to cancel their policy. With out any income paying there salaries you will see how fast the price of their premiums will drop.
No persons health or life should be for profit!!!
The mass cancellations will come when Obamacare's individual mandate kicks in in 2014 and the insurance companies really raise rates.
BigJim,
You beat me to the punch! I had this exact same thought. What to do about sick people without health care then? We could form co-op's of some sort. Perhaps a few renegade doctors would volunteer their services for a sliding scale fee. Many nurses (myself included...and probably Michael C from Minnesota) would be happy to form private practices for a sliding scale fee to help out doctors. I really believe this is a perfect way to thwart the insurance companies. Of course, they will then find some way to persecute us and have us arrested for illegal practice or some such thing I'm sure! We'll have to insure the legality of this action prior to initiation! Let's go for it people!!!
acutenecrotizing fasciitus
Yep, Blue Shield raised my rates 23% several years ago, and so I adjusted my protection downward. Then Blue Shield raised my rates about 20% last year, and so I adjusted my protection downward.
In June 2009 I went to ER to get five stitches in my thumb. The total bill was about $2090.00. The doctors in ER here in San Diego (@ one hospital) turned out to be out of network, so the insurance didn't cover the $600.00 they wanted for providing care. The hospital billed over $1400.00 for ER services. The total comes to about $418 per stitch. Just for comparison, I rec'd three stitches three years ago, went to the same ER, & the cost was about $1100.00, a cost of about $366 per stitch.
They are going to get us no matter what. The govorporation will squeeze & squeeze
There must be some way to infect the principals of Anthem with HIV/AIDS.
Go for it people.
peacekeepertwo: Every seat accupied by lawmakers, running for re-election must have a Progressive/ Socialist sitting in it next Term. Then pass Single-Payer Medicare for all. There is no way make the Private system work.
It is very telling that Blue Cross-Anthem-Wellpoint took the tack of announcing premium increases in the middle of the health care debate. They have nothing to fear.