Feb 9 2010
U.S. Department of Health and Human Services (HHS) Secretary Kathleen
Sebelius today sent a letter to Anthem Blue Cross and called on the
company to publicly justify its decision to raise premiums for its
California customers by as much as 39 percent. In her letter, Sebelius
notes that the parent company of Anthem Blue Cross, WellPoint
Incorporated earned $2.7 billion in the last quarter of 2009.
“As we continue the health insurance reform debate in Washington, this
announcement reminds us that too many Americans can be left with
unaffordable insurance each time the rates or rules change in the
private market”
“As we continue the health insurance reform debate in Washington, this
announcement reminds us that too many Americans can be left with
unaffordable insurance each time the rates or rules change in the
private market,” Sebelius added. “It’s clear that we need health
insurance reform that will give American families the secure, affordable
coverage they need.”
The text of Sebelius’ letter is below.
February 8, 2010
Leslie Margolin
President, Anthem Blue Cross
Delivered Via Fax
Dear Ms. Margolin,
One of the biggest pressures facing families, businesses and governments
at every level are skyrocketing health insurance costs. With so many
families already affected by rising costs, I was very disturbed to learn
through media accounts that Anthem Blue Cross plans to raise premiums
for its California customers by as much as 39 percent. These
extraordinary increases are up to 15 times faster than inflation and
threaten to make health care unaffordable for hundreds of thousands of
Californians, many of whom are already struggling to make ends meet in a
difficult economy.
Your company's strong financial position makes these rate increases even
more difficult to understand. As you know, your parent company,
WellPoint Incorporated, has seen its profits soar, earning $2.7 billion
in the last quarter of 2009 alone.
I believe Anthem Blue Cross has a responsibility to provide a detailed
justification for these rate increases to the public. Additionally, you
should make public information on the percent of your individual market
premiums that is used for medical care versus the percent that is used
for administrative costs. Policy holders in the individual market
deserve to know if their premium increases would be invested in better
medical care or insurance company overhead costs like salaries, profits,
and advertising. I am aware that the State of California is
investigating this matter, and urge Anthem Blue Cross to cooperate
fully. In the meantime, I will be closely monitoring the situation.
At a time when health care costs are a critical threat to families as
well as the nation's economy, I hope you appreciate the urgent nature of
this request. I look forward to your prompt reply.
Sincerely,
Kathleen Sebelius
Secretary of Health and Human Services
SOURCE http://www.hhs.gov/news.
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