Enormous premium increases of 25 to 40 percent announced by Anthem Blue Cross in California and Anthem Blue Cross and Blue Shield in Ohio, both units of Wellpoint, Inc., a health insurer with 33.7 million members across the country, have drawn newspaper stories and public outrage. In both cases, Anthem has cited soaring healthcare costs as part of the explanation for these premium increases.
But a look at healthcare costs shows that they play only a tiny role in hikes of these magnitudes. The U. S. Department of Labor's Bureau of Labor Statistics shows only modest increases in health costs during the past year. Anthem is attempting to put in place rate increases three to 12 times greater than the increase in medical costs. "Soaring" describes Anthem's premium increases, not actual healthcare costs.
| Component | Rate of Increase (Jan 2009 - Jan 2010) |
| Medical Care | 3.9% |
| Medical Care Commodities | 3.9% |
| Medical Care Services | 3.9% |
| Professional Services | 3.1% |
| Hospital and Related Services | 7.6% |
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