The Record (Stockton, CA)
STOCKTON, CA — Health insurer Blue Cross of California took more than two weeks to return the $888 it mistakenly removed from Stockton resident Irene Arnold’s bank account, and it has yet to send her a personal apology, as promised more than a week ago.
But that doesn’t mean she hasn’t heard from the insurer: Thursday, Arnold received a notice of a 16.6 percent rate increase on her individual Blue Cross policy.
“They keep continuing to screw me,” Arnold said Friday. “They pissed off the wrong person when they messed with me. Saying they’re sorry now won’t cut it.”
On April 1, Blue Cross automatically debited Arnold’s bank account five times for her $222 monthly premium payment. She notified the company immediately but was subjected, she said, to a bureaucratic runaround until her account was restored April 18.
Consumer advocate Jerry Flanagan called Arnold’s treatment “outrageous” and typical of “an uncaring, corporate monolith.” Flanagan, with the Santa Monica-based Foundation for Taxpayer and Consumer Rights, said that since Arnold went public with her problem, he has received several e-mails from consumers who had the same experience.
It is unknown how many Blue Cross members had their bank accounts debited more than once at the beginning of April. The company won’t say.
“I’d like to find somebody who’s actually gotten a letter of apology with an explanation. They are not owning up to any of their mistakes,” Arnold said.
A Blue Cross manager on Wednesday did e-mail Arnold a generic, undated letter that apologized and admitted that a “systems error” caused the overdebiting problem.
“At Blue Cross of California, we value your membership and strive to provide you with the best service possible, including bringing urgent service matters to your attention quickly,” said the letter signed by Debra Lang, director of membership individual services. A spokeswoman for Lang referred calls to Blue Cross corporate communications. Blue Cross corporate communications director Michael Chee did not return messages left Friday.
Arnold believes if she hadn’t brought this matter to Blue Cross‘ attention, they never would have notified her. Another Blue Cross manager, Rick Crum, told Arnold on Friday she would receive a letter by next Tuesday. When contacted, he said federal privacy laws and company policy restricted him from talking about Arnold’s situation.
“They are making my life hell. They can’t keep messing with people’s lives.
There is no time for me to unwind from this. I got my cell phone almost shut off because of running over my minutes with all the calling back and forth,” Arnold said.
Blue Cross did reimburse her $256 for her cell-phone costs, she said.
In addition to her rate increase effective June 1 for a policy she took out in December, Blue Cross is raising her minor stepson’s $54 monthly premium to $63, also a 16.6 percent increase. She said Crum told her the rate increase was necessitated by the nursing shortage, higher prescription fees and other increases in the cost of providing service. Her stepson has never used the policy, she said.
He wants an audit to make sure the premium increases are not they company’s way of passing on the cost of November’s $ 16.5 billion merger of Anthem Inc. and WellPoint Health Networks Inc. to customers. The resulting company, WellPoint Inc., is the parent company of Blue Cross of California in Thousand Oaks.
The agreement that allowed the merger explicitly states the merger costs would not be passed on to consumers.
Flanagan said he recently received “several dozen e-mails and phone calls” about 20 percent to 50 percent rate increases.
“The appearance is that Blue Cross has broken its promise to the state of California,” said Flanagan, a legislative analyst for the nonprofit, nonpartisan group.
A spokesman for Garamendi said the office has been investigating the rate increases.
“It was very clear that no part of any premium can be used to pay for merger costs,” Garamendi said in a statement. “We are investigating this to test the validity of their filings. If we find that any increase was connected to the merger, it will be rolled back.” The state Department of Managed Health Care, which handles patients covered by HMOs, also plans to look into the increases, spokeswoman Lynne Randolph said.
“We’re extremely concerned about the premium trend, if they are significantly above actual medical costs,” Randolph said.
Earlier in the week, Blue Cross‘ Chee said the rate increases were filed with the insurance commissioner’s office in January.
“The rate increase is in absolutely no way, shape or form tied to our merger,” he said.
He said the increase, averaging about 13 percent, reflected increases in rates charged by doctors and hospitals, medical services such as operating rooms or supplies, the cost of new technology and prescription drugs, and the increasing use of services by members.
“Our job is to have premiums to be able to cover the cost of care,” he said.
Anthem had to pledge $ 265 million toward improving health care in California to win approval for the merger from Garamendi. At the time of the merger, Garamendi’s office released a statement that Blue Cross of California would have to file rate and product changes for his review to ensure that no rate costs were used to help pay for the merger.
Garamendi’s office started investigating after being notified in January that an increase was coming.
“We’re not taking it at their word; we’re going to investigate it,” said Byron Tucker, deputy commissioner.
Chee said statements that the company is trying to pass on merger costs is unusual because it has made so many commitments to allay those concerns.
Consumer advocate Flanagan said Blue Cross has the burden of proof to show that these rate increases are not due to the merger.
“These rates increases are well above the current rate of medical inflation. Not only is Blue Cross treating their patients very badly, they are also charging them for their corporate excesses,” he said Friday.
Knight Ridder/Tribune News Service contributed to this report.