If you have individual health insurance with Anthem Blue Cross of CA and are about to be hit with huge rate hikes, this news is for you. Insurance Commissioner Steve Poizner says his office is investigating… but is this a real investigation or is he politicizing the investigation to boost his run for Governor?
Brought to you by Alison Gordon Insurance Services, Inc. CA license #0780178
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I actually called the state board and was told that they don’t, per se, have to approve rate hikes, so they have no real say in the rate hike going through or not.
Here’s the scoop. CA state law mandates that before premiums are raised, the company has to prove to the Dept. of Insurance (DOI) that no less than 70% of premiums are spent on medical expenses. Once the DOI reviews the numbers, the new rates are approved. BUT… the actuaries who provide the data to the DOI are hired and paid by the insurance companies! We all know that number crunching is an art not a science, right? Now, Poizner is appointing independent actuaries to re-crunch the same numbers to prove or disprove that Anthem BC is spending no less than 70% of premiums on medical expenses. Somewhere in the middle, between Anthem BC’s actuaries and Poizner’s actuaries, lies the truth. This is a huge multi-headed monster; knowing what is true is almost an impossible task.
I actually called the state board and was told that they don’t, per se, have to approve rate hikes, so they have no real say in the rate hike going through or not.
Here’s the scoop. CA state law mandates that before premiums are raised, the company has to prove to the Dept. of Insurance (DOI) that no less than 70% of premiums are spent on medical expenses. Once the DOI reviews the numbers, the new rates are approved. BUT… the actuaries who provide the data to the DOI are hired and paid by the insurance companies! We all know that number crunching is an art not a science, right? Now, Poizner is appointing independent actuaries to re-crunch the same numbers to prove or disprove that Anthem BC is spending no less than 70% of premiums on medical expenses. Somewhere in the middle, between Anthem BC’s actuaries and Poizner’s actuaries, lies the truth. This is a huge multi-headed monster; knowing what is true is almost an impossible task.