Aetna Life Insurance Co. raised health insurance rates for small employers by an average of 8% a year beginning April 1, a hike that California Insurance Commissioner Dave Jones called unreasonable.
Jones said Thursday that he'd asked Aetna to withdraw its increase in quarterly rates, affecting 77,000 employees and dependents of small employers.
But Jones said he has no legal power to reject Aetna's rate increase, a situation that he said could change if voters back a proposed initiative to require health insurers to seek prior approval from regulators for changes in rates.
"Small employers are struggling in this economy and should not be hit with a 30% increase in just 24 months for health insurance for their employees," said Jones. "Like the recent unsustainable rate increases imposed by other health insurers on Californians, Aetna's rate increase proves again that we need to close the loophole in California law which denies the insurance commissioner the authority to reject excessive health insurance rates."