Mills backs health insurance decision

Nick Rees Apr. 26, 2010, 1:55pm


AUGUSTA, Maine (Legal Newsline) - Maine Superior Court Chief Justice Thomas Humphrey has affirmed the denial of Anthem Health Plans of Maine's 2009 rate increase request by the state insurance superintendent, Maine Attorney General Janet Mills has announced.

The court, in denying Anthem's fixed profit margin in rates for individual health insurance plans in Maine, found that individual health plan rates meet the governing legal standard if the ability of the insurer to "sustain projected losses and expenses" is covered. Additionally, the court held, Maine law does not "expressly entitle insurers to a mandated profit margin."

"In the past three years alone, Anthem turned over $200 million in dividends to its parent company Wellpoint, one of the largest health insurers in the country," Mills said.

"Anthem cannot impose high rate increases on the backs of individual policy holders to maximize its corporate profits."

The superintendent was acting within her authority in granting Anthem an average 10.9 rate increase on individual policies, including a 0-percent profit and risk margin, the court affirmed.

The court also found that the superintendent had properly relied on the existence of Anthem's aggregate surplus from all lines of insurance that would be used to cover, if necessary, claims and expenses that could arise from individual products.

"We agree with the court," Mills said. "Maine law does not guarantee health insurance companies millions of dollars in additional profits. Small businesses and the self-employed in Maine struggle to afford even the most basic health care coverage. We must take responsible steps to prevent health insurance from becoming all but unaffordable, while allowing health insurers to cover the cost of doing business."

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