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Court Affirms Insurance Superintendent's Denial of Anthem's 2009 Requested Rate Increase
April 22, 2010
Contact: Kate Simmons (207) 626-8577
Augusta- Maine Superior Court Chief Justice Thomas Humphrey affirmed the Insurance Superintendent’s denial of Anthem Health Plans of Maine, Inc. fixed profit margin in their rates for individual health insurance plans in Maine. The Court found that individual health plan rates meet the governing legal standard if they cover the ability of the insurer to “sustain projected losses and expenses,” and that Maine law does not “expressly entitle insurers to a mandated profit margin.”
“We agree with the court. 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,” said Attorney General Janet T. Mills.
The Court’s decision affirms that the Superintendent of Insurance acted within her authority in granting Anthem an average 10.9% rate increase on individual policies that included a 0% profit and risk margin. The Court also found that the Superintendent properly relied on the existence of Anthem’s aggregate surplus from all lines of insurance to cover, if necessary, claims and expenses arising from the individual products.
“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,” Attorney General Mills said. “Anthem cannot impose high rate increases on the backs of individual policy holders to maximize its corporate profits.”