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Blue Shield rates to undergo independent review
NEWS IN BRIEF — Posted Jan. 31, 2011
After an outcry from physicians and state and national regulators, Blue Shield of California said it will submit its most recent rate increases to an independent actuarial review to verify the company's compliance with medical spending rules.
Blue Shield said Jan. 14 that David Axene, the actuary who reviewed a planned rate hike by Anthem Blue Cross of California in 2010, will look at Blue Shield's filing. Blue Shield has raised rates on individual customers three times since October 2010, translating to a cumulative increase reportedly as high as 59%. The latest planned increase would average 15%, according to the company.
Under California law, the insurance commissioner may review planned rate increases to verify that insurers will attain a minimum medical-loss ratio, but the commissioner does not have the authority to reject or approve the increases. In 2010, Anthem revised its planned rate increase from an average hike of 25% to 14% after Axene identified mathematical errors in the company's cost projections.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2011/01/31/bibf0131.htm.
