NEW YORK
Fri Jun 25, 2010 11:34am EDT
(Reuters) – Health insurer Aetna Inc has withdrawn its filing for rate increases in California after “substantial mathematical errors” were found, according to state regulators.
Aetna, whose shares fell more than 2 percent, is the second major health insurer, after WellPoint Inc, to withdraw its rate filing request in the most populous U.S. state after errors were found.
State rate filings have come under greater scrutiny across the country. President Barack Obama warned insurers on Tuesday not to use the recently passed healthcare overhaul as a opportunity to push through big rate increases.
Aetna’s filing would have increased rates by an average of 19 percent on its 65,000 policyholders, according to the California Department of Insurance.
During an internal actuarial review, Aetna found a miscalculation that it attributed to a “simple human error,” the company said in a statement. It said it informed the California insurance department as soon as it found the mistake.
The No. 3 U.S. health insurer said it had not yet implemented the proposed rate changes and that there was no impact to its members with individual health plans in California.
WellPoint’s Anthem Blue Cross unit in April withdrew its filing to raise rates by an average of 25 percent in California. Democrats had strongly criticized the company’s proposed rate hike as they rallied support to pass the health reform law.
California Insurance Commissioner Steve Poizner said he would post future individual health insurance filings on the department’s website, calling the move an “exceptional step” that he hoped would increase pressure on insurers to avoid errors.
“Given that two of the four major health insurers have provided rate filings containing math errors, I believe an additional level of transparency is warranted,” Poizner said in a statement.
