California AG Investigating 7 Insurance Companies For Illegal Rate Hikes

The showdown over skyrocketing insurance rates in California got even nastier yesterday. The state’s Attorney General’s office announced that it has subpoenaed financial documents and launched an investigation into allegations of illegal premium hikes and wrongfully denied claims by seven separate health insurance providers.

The insurance companies under the AG’s microscope:
• Anthem Blue Cross
• Aetna Health
• Blue Shield of California
• Cigna
• Health Net
• Kaiser Permanente
• PacifiCare

The state is also putting Anthem’s controversial, proposed rate increase.

“We have been looking at these companies for a number of months and are very concerned that some of them are unjustly raising premiums and denying payment of legitimate claims,” Attorney General Jerry Brown said about the investigation. “Not only are the rate increases devastating to Californians strapped by the economy, but in some cases, they are possibly illegal.”

As part of the investigation into Anthem’s proposed rate hikes, the AG is seeking information about the finances of the company’s top 10 executives.

These subpoenas were handed down by the state Assembly’s Rules Committee, an action that hadn’t been done in 10 years. But Assemblyman Dave Jones, who is chairing the committee that’s looking into the Anthem controversy, claims that the Assembly was forced to use its subpoena power after Anthem (and its parent company WellPoint) refused to be forthcoming with previously requested documentation.

“It’s unfortunate,” Jones explained, adding that Anthem Blue Cross “played games with our original request, and we were forced to produce this subpoena.”

California subpoenas big health insurers’ financial records [L.A. Times]

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.