Calif.'s Anthem Blue Cross president resigns following sharp criticism of rate increases

The Los Angeles Times: Leslie Margolin, the president of California's Anthem Blue Cross, is resigning. "During her 2 1/2-year tenure at the helm of California's largest for-profit insurer, Margolin tried to cast Anthem as a responsible corporate leader that cared for customers and sought to contain costs by forging collaborative relationships with hospitals, doctors and other medical providers. But shaping Anthem's image grew increasingly difficult this year," due to "planned rate increases of up to 39% for many of its nearly 800,000 individual policyholders in California. Anthem's rates became a national symbol of insurer excesses, and the company canceled the hikes in April after miscalculations were uncovered in its filing" (Helfand, 7/21).

The Associated Press: "Kristin Binns, a spokeswoman for Anthem Blue Cross' parent company, Wellpoint Inc., added that Margolin's resignation 'is not in any way related to the individual rate filing in California.' ... Anthem withdrew its rate increases in April after California regulators revealed accounting errors in the insurer's proposal that would have resulted in higher profits. The insurer now says it plans to raise premiums an average of 14 percent, capping hikes at 20 percent" (Mohajer, 7/20).

The Wall Street Journal: "Ms. Margolin said she wasn't responsible for the decisions and oversaw rates only for the commercial business. ... Starting Tuesday, Ms. Margolin said, she will lead a coalition called Transforming Health Care, a partnership of hospitals, doctor groups, health plans and consumer advocates aiming to cut costs in the California health-care system. The group hopes to reduce health-care costs by up to 20% by creating an integrated health-care system. It will be similar to Kaiser Permanente, she said, but a 'virtual' network of independent entities rather than a single system" (Johnson, 7/21).