Anthem Responds to Sebelius. She calls "bullshit"

Anthem Blue Cross sent a letter to Health and Human Services Secretary Kathleen Sebelius Thursday blaming its recent rate hikes on the weak economy and rising medical costs.

Financial woes have pushed healthier people to drop coverage or buy cheaper plans, the company argued to Sebelius, who had demanded an explanation this week for the company's decision to raise premiums by as much as 39 percent. As a result of losing those customers and holding on to sicker ones, the insurer said its individual business in California operated at a loss during 2009, and an increase in rates would cover the anticipated shortfall this year.

"While this dynamic always exists, in a challenging economy it becomes more prevalent as individuals who are paying for coverage without a government or employer subsidy must choose to continue coverage or use the money for other necessities," wrote Brian A. Sassi, president and CEO of the consumer business unit at Wellpoint, Anthem's parent company.

At the same time, medical prices are rising faster than inflation. People are also using more health services, "driven largely by an aging population, lifestyle that results in chronic disease, new treatments, and more intensive diagnostic testing," wrote Sassi.

WellPoint said the increases relate only to the individual insurance market, less than 10 percent of its California members, and that a minority of its 800,000 individual policy holders will see 39 percent increases. The company said an independent actuarial firm concluded its rates were "sound and necessary."

Earlier this week, Sebelius launched the federal inquiry after the rate hikes were widely publicized. In a letter to Anthem, Sebelius said she was "very disturbed" by the increase, especially since Wellpoint earned $2.7 billion in the last quarter of 2009.

House Energy and Commerce Committee Chairman Henry Waxman and Rep. Bart Stupak also sent a letter to Wellpoint CEO Angela Braly asking her to testify at a Feb. 24 hearing on the matter.

UPDATE: After getting Wellpoint's 5-page letter Thursday morning, Sebelius shot back that the company's explanation didn't jive with their financial statements.

"It remains difficult to understand how a company that made $2.7 billion in the last quarter of 2009 alone can justify massive increases that will leave consumers with nothing but bad options: pay more for coverage, cut back on benefits or join the ranks of the uninsured. High health care costs alone cannot account for a premium increase that is 10 times higher than national health spending growth," she said in a statement.

"Without comprehensive reform, fewer people will be able to afford health insurance and Anthem's decision to raise their rates only demonstrates the urgent need for real reforms that fix our broken health insurance system. Reform will end the worst insurance company practices and put doctors and patients -- not insurance companies -- in charge of medical decisions. If we fail to implement reform, insurance companies will continue to prosper while families will continue to struggle."


http://www.politico.com/politico44/perm/0210/anthem_explains_77f55ea0-cc0a-417a-b0e2-24c992fb7545.html

The sternly worded letter.

They don't have to justify it. Why did they raise rates? Because they can!

Because our politicians have failed us in solving this health care crisis.

Instead of writing angry letters to insurers, get HCR passed so they can't do these things anymore.

In the recent run up to my two operations I had some test taken. For the last 35 years I have had BC/BS and never ever had a claim denied. My Clinic says they denied a $150.00 total blood test. I'm going to call till I get thru and raise H-E-L-L....this is ridiculous a simple blood test.

We have Medicare plus MedAdvantage. They just recently raised our month premium by a third and suddenly denied arthritis meds that we have taken for years.

So the brilliant insurance INDUSTRY decides to raise rates... so ever fewer and fewer people can afford insurance. Yeah, that makes sense. :eyes:

Sometimes something that is broken is beyond repair. The only thing to do is throw it away and replace it with something else.

Private health insurance as the cornerstone of our healthcare system is broken beyond repair. No amount of reform is going to 'fix' it.

Time for it to go to the dustbin.