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WellPoint records subpoened in California probe

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WellPoint Inc., Aetna Inc. and Cigna Corp. are among health-care companies whose financial records have been subpoenaed by the state of California in a probe into rising premiums and denied medical claims.

The rate-setting and claims practices may be illegal, California Attorney General Jerry Brown said in an e-mailed statement, adding that the companies have 30 days to turn over financial and other records covered by the subpoenas. Documents were also demanded from Health Net Inc., Blue Shield of California, Kaiser Permanente and PacifiCare Health Systems Inc.

|The investigation was undertaken in response to reports that California insurance providers deny almost 40 percent of claims, Brown said. The subpoenas cover health plans that reimburse doctors and hospitals for services, and follow a demand Brown made last month for documents covering the same companies’ managed-care plans, or health maintenance organizations, he said.

U.S. Representative Henry Waxman, D-Calif., yesterday claimed that Indianapolis-based WellPoint, the biggest U.S. health insurer by enrollment, sought to raise health-insurance rates in California to boost profits and cover costs ballooned by executive pay and corporate retreats. At a hearing in Washington, Waxman said the company also may have manipulated calculations to justify the proposed 39 percent rate increase for Californians who buy their own policies.

WellPoint paid compensation of at least $1 million apiece to 39 executives in 2008 and spent $27 million over two years on executive getaways, Waxman said, citing documents obtained by his committee.

Kristin Binns, a WellPoint spokeswoman, said in an e-mail that she was trying to verify the company received the subpoenas. If so, WellPoint will review Brown’s request and “respond appropriately,” she said.

WellPoint Chief Executive Officer Angela Braly said at the hearing Wednesday that the company’s proposed rate increase for Californians who buy their own policies was driven by surging costs and a recession that forced healthy people to drop coverage.

Aetna, based in Hartford, Conn., is the third-largest U.S. medical insurer. Cigna, whose shares rose the most among the largest insurers last year, is based in Philadelphia.

Chris Curran, a Cigna spokesman, said the company hasn’t yet received the subpoena and when it does, “we’ll respond to his office as appropriate.”

Aetna Inc. spokesman Fred Laberge didn’t immediately return calls seeking comment after regular business hours.

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  1. These liberals are out of control. They want to drive our economy into the ground and double and triple our electric bills. Sierra Club, stay out of Indy!

  2. These activist liberal judges have gotten out of control. Thankfully we have a sensible supreme court that overturns their absurd rulings!

  3. Maybe they shouldn't be throwing money at the IRL or whatever they call it now. Probably should save that money for actual operations.

  4. For you central Indiana folks that don't know what a good pizza is, Aurelio's will take care of that. There are some good pizza places in central Indiana but nothing like this!!!

  5. I am troubled with this whole string of comments as I am not sure anyone pointed out that many of the "high paying" positions have been eliminated identified by asterisks as of fiscal year 2012. That indicates to me that the hospitals are making responsible yet difficult decisions and eliminating heavy paying positions. To make this more problematic, we have created a society of "entitlement" where individuals believe they should receive free services at no cost to them. I have yet to get a house repair done at no cost nor have I taken my car that is out of warranty for repair for free repair expecting the government to pay for it even though it is the second largest investment one makes in their life besides purchasing a home. Yet, we continue to hear verbal and aggressive abuse from the consumer who expects free services and have to reward them as a result of HCAHPS surveys which we have no influence over as it is 3rd party required by CMS. Peel the onion and get to the root of the problem...you will find that society has created the problem and our current political landscape and not the people who were fortunate to lead healthcare in the right direction before becoming distorted. As a side note, I had a friend sit in an ED in Canada for nearly two days prior to being evaluated and then finally...3 months later got a CT of the head. You pay for what you get...

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