Anthem Blue Cross of California will refund $8.3 million to 50,000 Californians because of mid-year changes it made to individual customers' annual policies in 2011, according to a class-action lawsuit settlement announced Tuesday.
Consumer Watchdog, a Santa Monica-based advocacy group, said the giant insurer also has agreed it will no longer make such changes to annual deductibles, co-pays or other out-of-pocket costs.
"Words like 'annual' and 'yearly' should mean something in a health policy,'' Jerry Flanagan, an attorney with Consumer Watchdog, said during a Tuesday morning news conference.
He said the average reimbursement, expected to be mailed in December, is $167; one customer will be reimbursed $19,000.
Flanagan lauded two Anthem customers who, he said, "stood up and took on Blue Cross" and its "bait-and-switch'' tactic that increased their deductibles and other out-of-pocket costs after both individuals had already met those payment thresholds in 2011.
An Anthem Blue Cross of California spokesman said the company "is pleased that all parties were able to come to an agreement.''
Separately, Anthem had to pay Consumer Watchdog and another law firm that worked on the cases $1.76 million in attorney fees.
Contact Tracy Seipel at 408-920-5343. Follow her at Twitter.com/taseipel.