Aetna has said it is moving forward with health insurance premium hikes despite opposition from consumer groups. The state insurance commissioner has called the company’s action “unreasonable.”
Aetna’s decision to raise healthcare premiums for small business customers marks the first time an insurer in California has moved forward with increases the state Insurance Commissioner has deemed excessive.
The increases will average about 8 percent a year, but in some cases they could run as high as 21 percent.
State law allows the Insurance Commissioner’s office to assess whether companies can justify rate hikes. However, it doesn't give the office power to take action against a company it determines has unjustly decided to raise premiums.
An analysis by the state insurance agency says Aetna’s premium hike is “unreasonable” because its claims don't support its projections about its medical cost increases.
Aetna says it based the increases on sound data and that the hikes will affect about 16,000 small business customers.
The company’s decision to raise premiums is fueling Consumer Watchdog’s effort to place an initiative on the state ballot that would give the insurance commissioner authority to reject health insurance rate hikes.