Individual insurance rates soar 15% or more in at least 3 states

By Linda A. Johnson, Associated Press

TRENTON, N.J. — Consumers in at least three states who buy their own health insurance are getting hit with premium increases of 15% or more.
Anthem Blue Cross, a subsidiary of WellPoint, has been under fire for a week from regulators and politicians for notifying some of its 800,000 individual policyholders in California that it plans to raise rates by up to 39% March 1.

The Anthem Blue Cross plan in Maine is asking for increases of about 24% this year. Last year, they raised rates 32%.

And in Oregon, multiple insurers were granted rate hikes of 15% or more this year after increases of around 25% last year.

The increases affect groups of customers who purchase individual health insurance, rather than getting it through their employer.

Premiums are far more volatile for individual policies than for those bought by employers and other large groups, which have bargaining clout and a sizable pool of people among which to spread risk. As more people have lost jobs, many who are relatively healthy have decided to go without health insurance or get a bare-bones, high-deductible policy. Both result in a decline in premiums for insurers.

Steep rate hikes in this sliver of the insurance market have popped up sporadically for years. Experts see them becoming increasingly common.

"You're going to see rate increases of 20%, 25%, 30%" for individual health policies in the near term, Sandy Praeger, chairwoman of the health insurance and managed care committee for the National Association of Insurance Commissioners, predicted Friday.

A number of consumer groups in Maine are planning big rallies at two public hearings on Anthem's proposed rates later this month.

Politicians and even some health insurers are urging a revival of the stalled effort in Congress to overhaul the health care system.

WellPoint, which is based in Indianapolis, has said it needs to raise rates so much because the weak economy has resulted in a smaller number of people, many with serious health problems, remaining in the individual market in the individual market in California, while costs of caring for them have been rising due to higher provider prices and more use of diagnostic tests.

About 13 million Americans purchased health insurance through the individual market in 2008, the most recent data available.

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