Judge Affirms Insurance Superintendent’s Decision in 2009 Anthem Individual Rate Filing

GARDINER, MAINE – The Maine Superior Court has affirmed Insurance Superintendent Mila Kofman’s May 18, 2009, decision denying Anthem Health Plans of Maine’s proposed 18.1% average rate increase for individual health plans in 2009.

The court upheld Kofman’s ruling that the 2009 rates could not include a profit and risk margin.  In his April 21 decision, Superior Court Chief Justice Thomas Humphrey stated that it was not improper for the Superintendent to consider the state of the economy and the profits from Anthem’s other lines of insurance in making her decision on the proposed increase.

“I applaud the court’s decision,” said Kofman.  “It is good news for Maine consumers that the court has affirmed the authority of regulators to consider all relevant factors in deciding whether proposed insurance charges meet the legal requirements.”

In January of 2009, Anthem requested an average increase of 18.1% on its HealthChoice and Lumenos products.  Following public comment sessions and a public hearing in March 2009, Kofman denied the request and instead approved an average increase of 10.9 percent.  The increase became effective on July 1, 2009.  Anthem had requested a 3 percent profit and risk margin in its rates, and appealed the portion of the Superintendent’s decision denying any profit and risk margin for individual plans in 2009.  Oral arguments in the appeal were held on March 23, 2010.

Anthem’s 2010 individual rate filing is still pending.

The Bureau of Insurance is part of the Department of Professional and Financial Regulation, which encourages sound ethical business practices through regulation of insurers, financial institutions, creditors, investment providers, and numerous professions and occupations for the purpose of protecting the citizens of Maine. Consumers can reach the Bureau through its website at www.maine.gov/insurance; by calling 800-300-5000 in state; or by writing to Bureau of Insurance, 34 State House Station, Augusta, ME  04333.

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