Insurance giant Anthem Blue Cross has agreed to pay more than $6 million to refund a portion of a $2 monthly fee it had imposed for paper statements mailed to more than 600,000 of its California policy holders. Despite agreeing to the payout, Anthem denies any wrongdoing.
The settlement grew out of a class action lawsuit against Anthem. Under the terms of the settlement approved by the Los Angeles County Superior Court on June 21, Anthem has also agreed to no longer impose any fee on paper statements, which had earned the company about $2 million annually.
The deal pleased Beverly Hills Attorney Kathryn Trepinski, who filed the lawsuit. She said the suit had earlier prompted Anthem to stop charging the $2 paper bill fee and a $15 credit card surcharge, "which was very gratifying to see."
The settlement will net each class member a 75 cent reimbursement for each $2 fee they paid over a four year period.
In a statement, Anthem Blue Cross spokesman Darrel Ng denied the company did anything wrong, and said the paper bill fee and the credit card surcharge were legally collected.
"Nevertheless, Anthem recognized the uncertainty and risks in any litigation and concluded that it was desirable to resolve the litigation," Ng said.
The class action suit stemmed from a larger issue that made headlines in the fall of 2011, after Anthem stopped accepting automatic credit card payments from customers and then cancelled health coverage for those who did not understand the change.
That issue became moot three months later, when the insurer reinstated all of those who wished to regain their coverage. Anthem also paid for any medical expenses the policyholders incurred during the period they were without insurance.