It may be under siege for proposing record health insurance premium increases in California, but Wellpoint, parent company of Anthem Blue Cross, has announced that its first quarter profits for this year increased 51% over the same period last year. Wellpoint’s profits soared even as it was forced to delay increasing health insurance premiums in California. Those proposed rate hikes would have increased the health insurance premiums of its California health insurance policyholders by as much as 39%.
Despite the increased profitability, Wellpoint Chief Executive Officer Angela F. Braly noted, “Due to this delay, our individual business in California is performing below expectation this year and lost money in March .. The premiums we charge must be sufficient to cover the underlying cost of care.”
Even without the increases, though, Wellpoint beat Wall Street expectations. In its first-quarter report, WellPoint said it earned $877 million, or $1.96 a share, compared with profit of $580 million, or $1.16, a year earlier. Excluding one-time costs and gains, the company’s earned $1.95 a share, surpassing analysts’ average estimate of $1.67.
Senator Dianne Feinstein of California was quick to jump on the news, and called for Wellpoint to continue to postpone its California rate hikes until Congress decides on a bill that would create a national rate review authority. “WellPoint’s actions are a textbook example of the profits-above-all-else Wall Street mentality that has caused major hardship for millions of average Americans,” Feinstein said.
How do you feel about the Wellpoint’s profits? Got an opinion on the Anthem Blue Cross rate hikes? Talk about it at the MyHealthCafe.com Forums.
- Update: Department of Health and Human Services Inquiry on Anthem Blue Cross Rate Hikes
- Healthcare Reform: Wellpoint (Anthem Blue Cross) and Blue Shield of California End Rescissions Ahead of Schedule
- Healthcare Reform: Wellpoint (Anthem Blue Cross) to Extend Health Insurance Coverage to Adult Children on June 1
- Anthem Blue Cross Update: Health Insurance Increases Delayed Until at Least May 1
- Anthem Blue Cross Hikes Health Insurance Rates Up to 39%