Santa Monica, CA --- Consumer Watchdog Campaign challenged the Blue Cross parent company CEO’s contention to shareholders yesterday that the California health insurance rate regulation initiative now circulating is not necessary because federal law adequately protects patients by pointing to the 1 million Californians facing rate hikes on May 1st. Anthem Blue Cross will raise rates by more than $100 million for over 600,000 Californians even as it delivers rebates for overcharging consumers last year and raked in $856 million in profits in the first quarter of 2012.
“One million Californians will be paying hundreds of millions of dollars more for their health insurance next week because health insurance companies decided to raise rates, not because the companies proved the rate hikes are justified and got permission first,” said Jamie Court, proponent of the pending ballot measure, which requires justification and permission for all rate hikes. “Ms. Braly is clearly out of touch with the needs of patients who have seen their health insurance rates go up five times faster than the rate of inflation over the last decade because California is one of the few states without rate regulation."
Consumer Watchdog Campaign is sponsoring the ballot initiative that would make health insurers publicly justify rate changes, and give the state’s insurance commissioner the authority to modify or deny excessive rate increases. Voters are downloading and signing the petition online at www.JustifyRates.org. The campaign has gathered more than 500,000 of the 795,000 signatures needed to qualify for the November ballot, with just three weeks of signature-gathering remaining.
WellPoint’s 1st quarter financial report also notes that medical costs increased just 4.8%, but California patients will see rate increases of up to 19.95, more than four times that amount.
In her comments to investors, WellPoint CEO Angela Braly said California’s rate review process was “effective,” yet just last month a rate increase was implemented even though state Insurance Commissioner Dave Jones found it was “unreasonable,” because no one in California has to power to prevent unreasonable rate increases.
The ballot initiative, the “Insurance Rate Public Justification and Accountability Act:"
Requires health insurance companies to publicly disclose and justify, under penalty of perjury, proposed rate changes before they take effect.
Makes every document filed by an insurance company to justify a rate increase a public record, and requires public hearings on some proposed rate increases.
Gives Californians the right to challenge excessive and unfair premium rate increases.
Prohibits health, auto and home insurers from considering Californians’ credit history or prior insurance coverage when setting premiums or deciding whether to offer coverage.
- Gives the insurance commissioner authority to reject unjustified health insurance rate increases.
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Consumer Watchdog Campaign is chaired by insurance reform Proposition 103 author Harvey Rosenfield. Consumer Watchdog Campaign is the campaign affiliate of Consumer Watchdog, which was founded by Rosenfield and whose president, Jamie Court, an award-winning consumer advocate and author, is the proponent of the proposed ballot initiative.