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UPDATE 1-US's Sebelius chides WellPoint unit over rate hike
February 8, 2010 / 8:27 PM / in 8 years

UPDATE 1-US's Sebelius chides WellPoint unit over rate hike

* HHS secretary seeks details on reported Calif. rate hike

* Health insurer premium hike “extraordinary” -Sebelius

* Company reviewing HHS letter

WASHINGTON, Feb 8 (Reuters) - U.S. Health and Human Services Secretary Kathleen Sebelius questioned Anthem Blue Cross of California over reports that the health insurer will increase some premiums by as much as 39 percent, in a letter to the WellPoint Inc WLP.N subsidiary on Monday.

Sebelius called for Anthem to offer the public a detailed explanation of the rate hike as well as other information about how much of consumers’ premium dollars go toward medical care rather than other expenditures.

“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,” Sebelius wrote to Anthem Blue Cross President Leslie Margolin.

The letter is a further black mark against health insurers as the Obama administration ramps up its rhetoric in an attempt to boost Democratic efforts to overhaul the nation’s healthcare system.

Health insurers have been a prime target for Democrats, now forced to revise their strategy for expanding access to insurance after losing their supermajority in a special Senate election last month.

While it was unclear what, if any, steps the U.S. health department could take, Sebelius said she was “very disturbed” and was “closely monitoring” the Anthem situation. State authorities in California -- the nation’s most populated state -- are also investigating the reported rate hike.

WellPoint spokeswoman Kristin Binns said the company had received the letter and was reviewing it.

The Los Angeles Times reported last week 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 March 1.

Anthem spokeswoman Peggy Hinz said the company has not made public any specific rates or details about how many customers have individual versus other types of plans. Overall, Anthem Blue Cross of California serves roughly 8.3 million people, Hinz said. (Reporting by Susan Heavey, editing by Gerald E. McCormick)

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