Reporting from Sacramento — Executives from California health insurance giant Anthem Blue Cross, under fire for scheduled rate hikes of up to 39%, insisted Tuesday that their premiums were fair and legal, and they told lawmakers they expected that the increases would go forward.
Appearing before the state Assembly's health committee, the officials said that they believed rate increases for individual health insurance policies, delayed until May 1 while being reviewed by the Department of Insurance, would survive scrutiny by regulators
The testimony came as members of the committee lashed out at Anthem for its proposed rate hikes and its corporate profit a day before the rate controversy moves to Washington, where a congressional subcommittee holds a hearing Wednesday.
At issue are steep premium increases for many of Anthem's 800,000 California customers who buy policies for themselves because they do not have insurance through employers.
The increases, which had been scheduled to take effect March 1, were delayed while independent actuaries, hired by California's insurance commissioner, review whether they are justified under state law.
Since word of rate increases in late January, the hikes and the profit of Anthem's parent company, WellPoint Inc., have come under attack by customers, insurance brokers, consumer advocates, regulators, lawmakers and the Obama administration.
President Obama on Monday proposed an expansion of federal authority to regulate health insurance rate increases such as Anthem's as part of his national healthcare reform package.
In Sacramento, Anthem's president, Leslie Margolin, told the committee that much of the public frustration over the rate hikes was misdirected and should be aimed at the nation's healthcare system.
"This debate and this inquiry cannot and should not be just about the insurance industry or the delivery system or regulators or legislators or customers or brokers," Margolin said.
"We have wasted precious time and precious resources doing battle with each other," she added. "We must come together collaboratively and strategically to address the distressing symptoms of our troubled system -- rising premiums, for example -- and to address the fundamental underlying causes of our collective failure."
