Consumer Watchdog Campaign: UnitedHealth Group Reports $1.4B 1st Quarter Profit, A 3% Increase Over Last Year; Insurer Increases Premiums on Californians Up to 17% on May 1

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Santa Monica — UnitedHealth Group, which runs the fifth-largest health insurance company in California, reported $1.39 billion in profits in the first quarter of 2011, a 3% increase over last year, as it raises premiums on 84,000 Californians with small business coverage as much as 17% on May 1st.

The insurance company is funding the fight against a ballot initiative proposed by Consumer Watchdog Campaign in California that would require health insurance companies to publicly disclose and justify spending and profits when applying for a rate increase, and get approval before any rate change takes effect.

“Health insurers are padding their profit margins by increasing premiums and right now no one in California has the power to say no. This ballot initiative will make health insurers open their books and justify why they’re raising prices for consumers even as costs go down and profits increase,” said Carmen Balber with Consumer Watchdog Campaign.

The ballot measure to regulate health insurance rates can be downloaded to print and sign at It would require health insurers to publicly justify rate changes, under penalty of perjury, and give the state insurance commissioner the ability to modify or deny excessive rate increases. Health insurance premiums in California have gone up at 5 times the rate of inflation over the last decade.

UnitedHealth Group’s financial report also noted that patients continue to use less medical care than in prior years, a phenomenon that will continue as health insurance benefits erode and going to the doctor is increasingly unaffordable, said Consumer Watchdog Campaign. Nevertheless, health insurance companies continue to use the specter of impending increases in medical care to justify raising premiums.

The “Insurance Rate Public Justification and Accountability Act”:

·  Requires health insurance companies to publicly disclose and justify, under penalty of perjury, proposed rate changes before they take effect.

·  Makes every document filed by an insurance company to justify a rate increase a public record, and requires public hearings on some proposed rate increases.

·  Gives Californians the right to challenge excessive and unfair premium rate increases.

·  Prohibits health, auto and home insurers from considering Californians’ credit history or prior insurance coverage when setting premiums or deciding whether to offer coverage.

·  Gives the insurance commissioner authority to reject unjustified health insurance rate increases.

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Consumer Watchdog Campaign is chaired by insurance reform Proposition 103 author Harvey Rosenfield. Consumer Watchdog Campaign is the campaign affiliate of Consumer Watchdog, which was founded by Rosenfield and whose president, Jamie Court, an award-winning consumer advocate and author, is the proponent of the proposed ballot initiative.

Carmen Balber
Carmen Balber
Consumer Watchdog executive director Carmen Balber has been with the organization for nearly two decades. She spent four years directing the group’s Washington, D.C. office where she advocated for key health insurance market reforms that were ultimately enacted into law as part of the Affordable Care Act.

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