California Blue Cross Hikes Premiums by 39%


Anthem Blue Cross – California’s largest for-profit health insurance company – just sent notice to some 800,000 customers who purchase individual health plans that their premiums will be increasing by as much as 39% on March 1st.  That’s over 15 times the inflation rate.  They also told subscribers that they will be adjusting rates more frequently, perhaps many times a year.

Insurers are free to cherry-pick the healthiest customers in the lightly regulated individual market. They can raise rates at any time as long as they notify the state Department of Insurance and prove that they are spending at least 70% of premiums on medical care.

The reason for these drastic hikes?  According to the company:

“Unfortunately, the individual market premiums are merely the symptoms of a larger underlying problem in California’s individual market — rising healthcare costs.”

The company just blames that amorphous entity: healthcare costs.  I would like to see just how much those costs are to the company, actually.  I highly doubt that they have risen anywhere even remotely close to the 39% hike that premiums will take.  Did doctors just start charging 39% more per office visit?  Did X-ray technology all of a sudden cost hundreds more per scan?  Are nurses making as much as their doctor counterparts now?  That sure would be news, wouldn’t it?  I feel like I would’ve read about that if it had happened.

Adding insult to injury, it was reported that Anthem Blue Cross’s parent company, WellPoint Inc.,  earned 2.7 billion dollars in the last quarter of 2009 alone, its CEO took home $10 million just in salary, and the company “spent nearly $9.5 million on lobbying against health reforms in 2009.”

I just don’t understand why people are so adamant about keeping health insurance a for-profit industry.  Their job is not to insure us and provide us care when we get sick or injured; their job is to make money.  And they don’t make money when they spend money on cancer treatments, insulin shots for diabetics, or pain medication for people with migraines.  Their stockholders don’t profit when the company dolls out money for your health care.  They are in the business of not providing care.

How many people were denied coverage so that Anthem CEO (and soon-to-be WellPoint chairperson and member of the board of directors) Angela Braly could earn her $10 million payday?

Why is it so un-American to not want people profiting off my health problems?



  1. I had always assumed that the Blues across the country were non-profit, like Blue Cross Blue Shield of Michigan. It was shocking to me that so many health insurance companies were for-profit institutions. To me that completely runs contrary to what health insurance should be about. Plus, since they aren’t a “insurer of last resort,” they can exclude people based on their medical condition – unlike BCBSM – so I’m not sure what their justification for such a huge hike would be.

    I’m sure there’s a lot of press on this – but I read this article and am glad that the Obama administration is looking for a detailed justification:


    • I used to have Blue Cross in California and my premium was jacked up because I had had a broken wrist 10 years prior. They will increase your premiums for any reason whatsoever. I was lucky that my pre-existing condition (if you can call a broken bone that) didn’t preclude me from even being able to receive coverage. Sure, the Obama Administration is going to look into it but so long as 70% of the premium revenue is going to pay for health care (as is my understanding) Anthem Blue Cross is completely acting within its legal bounds to raise those rates. That will be the status quo if reform fails – you better believe the other for-profit companies will be doing the exact same thing until only the rich or perfectly healthy (do they exist?) have health care at exorbitantly high prices.

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