American consumers in a number of states who buy their own
health insurance from Anthem Blue Cross
(ABC) are facing potentially crippling increases in the
costs of cover at a time when many are already financially
hard-pressed.
ABC, a unit of health insurance giant
WellPoint, has requested increases in at
least four states, which if granted will see policyholders face an
increase of 15% and more in premiums this year.
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In one state, California, almost a million individual
policyholders have been notified that their premiums will increase
by up to 39% on 1 March. In Maine, a 23% increase has been
requested and will follow last year’s 32% hike.
ABC is far from alone in passing on massive
premium increases to individual policyholders.
In Oregon, for example, the insurance
department recently granted a number of unnamed health insurers
premium increases of 15%, a move which followed the approval of
average increases of about 25%. Oregon is one of a few states that
have the power to grant or refuse premium increase requests.
The substantial premium increase which will
potentially impact the 13m consumers who buy health insurance
privately comes against the background of the announcement by the
Centers for Medicare & Medicaid Services that health spending
in the US grew 4.4% in 2008, to $2.3trn – $7,681 per person.
This was the slowest rate of growth since the
federal department started officially tracking expenditure in
1960.
Meanwhile the four largest US health insurers
have reported strong profit growth in 2009. The largest increase
was reported by Cigna, which saw its net profit surge by 346%
compared with 2008 to $1.3bn.
Also doing significantly better was WellPoint,
which increased its net income by 90.5% to $4.7bn. Of the two other
major health insurers, Humana reported a 60.7% increase in net
profit to $1bn and UnitedHealth a 30% increase to $3.8bn.
Net profit growth came despite falling
membership numbers. Cigna experienced a 5% fall, WellPoint a 4%
fall, Humana an 11% fall and United Health a 3% fall.
