CHICAGO (Reuters) - Health insurer WellPoint Inc WLP.N said on Tuesday it canceled its investor day scheduled for later this month so it can prepare for a congressional hearing on premium rate increases.
WellPoint, the largest U.S. health insurer by membership, also reiterated its full-year forecast for net income of at least $6 a share, and said it would provide more details on its outlook on a conference call with investors on March 17.
The forecast, it said, is subject to its ability to secure sufficient premium rates.
WellPoint's shares slumped $1.37, or 2.3 percent, to $57.96 in afternoon trading on the New York Stock Exchange.
U.S. lawmakers last week called upon WellPoint's chief executive to testify later this month about reports that its Anthem Blue Cross subsidiary planned to raise some premiums as much as 39 percent.
Anthem over the weekend announced it had agreed to postpone a rate adjustment for individuals in California by two months to allow the California Department of Insurance more time to review the plan.
The Los Angeles Times earlier this month had reported that about 800,000 Anthem Blue Cross of California customers with individual health insurance plans would see their rates spike by as much as 39 percent on March 1.
U.S. Health and Human Services Secretary Kathleen Sebelius said the two-month delay offers WellPoint's customers only temporary relief.
"What California families need is long-term health insurance security, so that they don't face sharply higher prices or fewer benefits," Sebelius said in a statement. "This rate increase underscores the urgency of passing real health insurance reform."
Health insurers have been a prime target for Democrats, now forced to revise their strategy for expanding health insurance access after losing their supermajority last month in a special Senate election.
WellPoint spokeswoman Kristin Binns said the company expects the average customer premium to increase roughly 24 percent to 25 percent.
The company said it is confident the state of California will find it followed actuarial principles and state law in setting its proposed rate increases, and it welcomes the opportunity to discuss the underlying rise in health costs.
"We welcome the scrutiny," said Binns. "We are confident in the data that we found. "We feel confident that the commissioner's findings will be in line with what we proposed."
U.S. health insurers face lower Medicare reimbursement rates in 2010 and reduced enrollment in employer-based plans due to widespread job losses.
Additional reporting by Jennifer Robin Raj in Bangalore; Editing by Matthew Lewis and Gerald E. McCormick