HHS Sec’y Sebelius doubts Wellpoint’s explanation on double-digit premium hikes

HHS Sec’y doubts Wellpoint on premium hikes

WASHINGTON — The government’s top health official isn’t buying a major health insurer’s explanation for double-digit premium hikes in the nation’s most populous state.

HHS Secretary Kathleen Sebelius said Thursday “it remains difficult to understand” how WellPoint can justify premium increases of as much as 39 percent for some of its customers in California. In a letter to Sebelius, WellPoint said healthy people have been dropping coverage at a time of rising medical costs, squeezing revenue to cover claims.

But Sebelius said the company made $2.7 billion in the last quarter of 2009, and the premium increases are 10 times higher than the increase in national health care costs.