Aetna, Blue Shield Proceed With Rate Hikes Despite Criticism
Aetna and Blue Shield of California are moving forward with double-digit rate increases despite criticism from state insurance regulators, the Los Angeles Times reports.
California regulators can investigate proposed rate hikes but do not have authority to reject the increases (Terhune, Los Angeles Times, 3/6).
Details of the Rate Hikes
On March 1, Blue Shield raised rates for about 27,000 individual policyholders by an average of 11.8%.
Aetna plans to increase premiums for about 20,000 small group policyholders by 11.4% on April 1.
Brent Barnhart -- director of the Department of Managed Health Care -- said that both rateÂ increases are unreasonable and unsupportable based on the insurers' historical and projected medical trends and assumptions of utilization of care.
He said, "I am disappointed that after lengthy negotiations, Blue Shield and Aetna were unwilling to bring their proposed health plan increases down to a reasonable level" (Shinkman, Payers & Providers, 3/7).
However, Barnhart said that Aetna agreed to slightly decrease a separate rate hike for about 20,000 small business policyholders, which will save members a total of about $300,000.
Response From Health Plans
Steve Shivinsky -- a spokesperson for Blue Shield -- said, "Unfortunately, the cost of hospital and physician services, prescription drugs and diagnostic tests continues to rise." Â He added, "Blue Shield has lost tens of millions of dollars in the individual market in recent years, and we expect similar losses in 2013."Anjie Coplin -- a spokesperson for Aetna -- said, "We take our commitment to our small business customers seriously and are making every effort to maintain an affordable array of products" (Los Angeles Times, 3/6). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.