News Release

Anthem hikes rates 22%

Insurer slightly trims original 26% increase on 630,000 Californians
For Immediate Release

Anthem Blue Cross is moving forward with a new rate hike on California consumers which will leave hundreds of thousands of individuals paying an average 22 percent more for insurance this year. Anthem had proposed raising rates 26 percent, but trimmed the rate to 22 percent after the California Department of Insurance (CDI) found the original increase unreasonable.

“Any Anthem customer can tell you that this is still a huge rate hike,” said Wesley Samms, CALPIRG Education Fund’s health care advocate, adding, “Taking a little off the top isn’t going to have customers celebrating.”

CALPIRG commended the Department of Insurance for pressing Anthem to reduce the rate hike, and for convincing Anthem to allow any consumers who dropped coverage due to the 26% hike to re-enroll without being denied coverage for pre-existing conditions. It is unclear how many Anthem consumers dropped coverage, and it remains to be seen how many will return now that the rate hike is slightly lower.

Unlike most states’ insurance regulators, California’s Insurance Commissioner lacks the authority to roll back or reject unreasonable rate increase proposals.

CALPIRG Education Fund evaluated one of the two proposals Anthem submitted to request the original 26% increase. CALPIRG Education Fund’s analysis found that the proposal predicted a high medical trend without fully showing the math behind it. In addition, the hike appeared to be based on medical loss ratios below the federal minimum standard of 80%.

“The original 26% rate hike wasn’t justified, and without further information from Anthem, we can’t tell if the 22% increase is justified either,” said Samms, “What is clear is that Californians are being asked to pay significantly more without a clear explanation why.”

Anthem’s move to raise rates follows another increase of nearly 20% for roughly 250,000 Californians. The California Department of Insurance publically decried as excessive and unjustified. Insurance Commissioner Dave Jones’s January 7 press conference brought national attention to Anthem’s previous rate hike.

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