It was announced last week, February 14, that Anthem Blue Cross has agreed to lower their rate increase that was implemented earlier this month for California Health Insurance. The California Insurance Commissioner, Dave [custom_frame_left][/custom_frame_left]Jones said he merely asked them to lower their rates and they agreed. Currently, the Department of Insurance can only review proposed rate increases but has absolutely no authority to reject excessive increases. Health insurance carriers can implement rate increases without approval and has caused many Californians to go uninsured as it has become unaffordable. Most consumers of individual health insurance policies are those who are self employed, students and others who are simply seeking to pay less than their employers can provide.
This increase from the largest health insurance carrier in California was announced in late 2012 and members were receiving notifications in the mail as early as November.The rate increase took effect February 1, 2013 and was set for an average of 17.9% for all PPO products sold to individuals and families. After this agreement with Commissioner Jones they have reduced their rate increase to an average of 13.87% statewide. This increase was set to impact about 630,000 policyholders and the estimated total savings for these individuals will be close to $54 million. However, even with these higher rates, Anthem said they still expect to lose money because of the rising medical costs in the state.
Anthem Blue Cross has also announced that they will allow members who switched to a lower cost plan to switch back to their previous plan and those who cancelled their coverage because of the increase to re-enroll in the same plan without going through medical underwriting. For many this is still no solution. The upcoming federal healthcare laws will dramatically change how people buy their own health insurance coverage. Soon, people will be able to purchase coverage through a state-run exchange program and be able to check if they qualify for federal subsidies or state programs like Medi-Cal. As we learn more about the Healthcare Reform laws we will be sure to educate you with all the facts so you can make informed decisions about your insurance.