Saturday, October 10, 2009

WellPoint Litigation against the State of Maine

The lawsuit recently brought by WellPoint against the state of Maine has not been adequately covered in the conventional media. This case deserves to be more seriously researched to illustrate the market information culture created by private insurance companies in the United States. Documents related to regulatory decisions against Anthem Blue Cross and Blue Shield, a subsidiary of WellPoint, are publicly available on the website of the Bureau of Insurance - Department of Professional and Financial Regulation -of the State of Maine. The mission of the Bureau is to regulate the insurance industry to protect and to serve the public. Specifically the Bureau licenses insurance producers and companies, performs examinations and audits, reviews rates and coverage forms, investigates complaints, educates consumers about their legal rights and responsibilities, and sponsors programs to promote compliance with state laws. The Anthem rate filing for 2009 and the Bureau decision are publicly available even though WellPoint has consistently attempted to have this and related documents and proceedings treated as confidential.

In 1999 Anthem, a subsidiary of WellPoint, bought the Blue Cross and Blue Shield not-for-profit health plans operating in Maine and transformed them into a for-profit business. Since that time premium rates paid into the plans by average individual subscribers have increased 4 fold. (There are approximately 12,000 individual subscribers to Anthem health insurance products in Maine.) The rate increase submitted to the Maine Bureau of Insurance in 2009 was 18.2% to guarantee Anthem a minimum profit margin of 3%. This increase has been rejected as unfair and excessive in favor of an increase of just 10.9%. Anthem is suing the State of Maine for this regulatory action judged discriminatory.

Brave New Films has posted a very informative video account of this suit. See also Sick for Profit:

The Main Public Broadcasting Network aired the story: "Anthem Sues State of Maine over Rate Hike Request Denial" on October 5. The Columbia Journalism Review published an article entitled WellPoint versus the State of Maine on October 9 giving some additional details about the litigation.

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