Aetna and Wellpoint subsidiary Anthem Blue Cross as well as Blue Shield have agreed to modify their most recent small group health insurance rate increases in California for the third quarter of 2012 for a total savings of $48 million for small employers, Insurance Commissioner Dave Jones recently announced.
By far the largest premium rate increase withdrawal was Anthem Blue Cross’s of 2.5% July 1 premium increase for small-group preferred provider organization products, resulting in a total savings of approximately $25 million for 45,000 of Anthem Blue Cross’s small group policyholders, covering approximately 280,000 individuals.
Anthem had raised rates 4.7% on its small group policyholders in the previous 12 months with its earlier rate increases, the California Insurance Department stated.
Blue Shield Life and Health Co. agreed to provide a credit to 58,000 small employers equivalent to reducing its July 1 third quarter rate increase by 1.5%, resulting in savings of approximately $15 million. As a result of the credit, the effective Blue Shield rate increase will be 1.6%, which is Blue Shield’s only small group rate increase for its small employer policyholders in the last 12 months.
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Aetna has agreed to lower its proposed small group rate from 2.6% down to 1.3% for its 9,200 policyholders (covering approximately 69,000 individuals), which results in a savings of approximately $8 million for small employers.
“We worked closely with the California Department of Insurance (CDI) to reach an agreement on rate changes” that were implemented for our Small Group members effective July 1, Aetna said.
We will continue to work with the CDI to ensure that Californians have access to a portfolio of competitively priced products in the marketplace,” Aetna stated.