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WellPoint Inc.’s now infamous decision to raise rates on individual customers in California as much as 39 percent was apparently made over objections by the company’s California president. Those increases by the Indianapolis-based health insurer were widely blamed for reigniting a dying health reform bill that WellPoint opposed. In an interview with the Los Angeles Times, Leslie Margolin said she worked internally to prevent WellPoint from raising rates so high and, once they did, to scale them back. The newspaper reported that Margolin and others voicing concerns about the size and timing of the hikes were overruled by WellPoint corporate executives. Margolin did not voice concerns about the increases when she was called before the California legislature to explain them, but the Times said she did apologize in a speech at Pepperdine University. WellPoint replaced Margolin last month and she told the Times she was escorted from her office by security guards, without a chance to say farewell to her employees. WellPoint said Margolin’s departure had nothing to with the rate hikes.

Officials in Gov. Mitch Daniels’ administration want to use the Healthy Indiana Plan as the vehicle to expand Medicaid coverage under the new federal health reform law—in spite of Daniels’ earlier comments that the new law would kill the three-year-old plan. According to the Associated Press, Indiana human services chief Anne Murphy sent a letter to the Centers for Medicare and Medicaid Services saying the Healthy Indiana Plan is "the natural vehicle" for expanding Medicaid coverage to Indiana residents in 2014. But when the new health law passed, Daniels described the Healthy Indiana Plan as a "program whose days are numbered" and asked Murphy to begin planning its phaseout.

Northwest Radiology Network PC recently expanded into Anderson by acquiring Madison County Imaging at St. John’s Medical Center and affiliating with Central Indiana Orthopedics of Anderson. Northwest Radiology is now providing its services to St. Vincent Heart Center of Indiana. Both St. John’s and the Heart Center are owned by the St. Vincent Health hospital system, based in Indianapolis.

The complex regulatory process for winning approval of combo medical products is the topic of next week’s Life Sciences Lunch at the Barnes & Thornburg law firm downtown. Gretchen Bowker, an Eli Lilly and Co. alumna and now chief operating officer of Pearl IRB Inc. in Indianapolis, will present, as will Julie Dykstra, a Barnes & Thornburg attorney. The Aug. 17 event, organized by the Indiana Health Industry Forum, costs $10 and starts at 11:30 a.m.

Riley Children’s Foundation received a $1.5 million pledge from the Jeff Gordon Children’s Foundation
to create a cancer research fund. The gift will create a $1 million endowment to fund collaborative research at Riley
Hospital for Children and the Wells Center for Pediatric Research at the Indiana University School of Medicine.
The remaining $500,000 will address immediate research needs at Riley hospital.

Indiana Spine Group will break ground on a 60,000-square-foot facility in Carmel on Aug. 2. The Indianapolis-based
physician practice says it will be able to provide care for any spinal disorder at the center. Located just south of the St.
Vincent Carmel Hospital, the facility will open in the fall of 2011. Indiana Spine Group will relocate its practice, which
is currently near St. Vincent Indianapolis Hospital.

Eli Lilly and Co.’s profits spiked 16 percent in the second quarter to $1.3 billion, or $1.22 per
share, handily beating expectations of Wall Street analysts. Revenue at the Indianapolis-based drugmaker rose 9 percent to
$5.7 billion in the quarter. The company raised its year-end profit forecast by a dime a share, to a range of $4.50 to $4.65,
excluding special items.

Zimmer Holdings Inc. also topped Wall Street expectations for second-quarter profit. The Warsaw-based maker
of orthopedic implants turned a profit of $165.5 million, or 82 cents per share. But it spent $86.5 million on legal claims
and an acquisition. Excluding those costs and special tax savings, the company would have earned $221.2 million, or $1.09
per share—four cents above analysts’ expectations, according to Thomson Reuters. Sales rose 3 percent to $1.06
billion.

Medical device maker Biomet Inc. plans an expansion of its northern Indiana facilities that could add about
280 jobs, according to the Associated Press. Company officials have discussed the plan with Kosciusko County officials as
they've sought tax breaks on the $26 million project. Biomet attorney Richard Helm says the expansion in Warsaw would
retain about 80 jobs and lead to some manufacturing being moved there from New Jersey. The project would also expand Biomet’s
Warsaw distribution center.

Eli Lilly and Co. will cut 170 jobs—mostly in Indianapolis—from its manufacturing and quality
division by the end of the year as it continues its efforts to slim down before losing revenue from patent expirations on
its bestselling drugs. The Indianapolis-based drugmaker’s latest move will cut nearly 5 percent of its 3,600-person
manufacturing work force in the United States. Lilly will ask for voluntary departures, but it also will eliminate the jobs
of others involuntarily. Some jobs have already been eliminated through attrition. Lilly has announced nearly 2,000 job cuts
toward its goal of 5,500 cuts, which the company set in September. The company is also trying to eliminate $1 billion in annual
expenses by the end of 2011. At that time, it hopes to have a worldwide staff of about 35,000. It currently employs 12,400
in Indiana.

Hundreds of patients will be shifted from Indiana's state psychiatric hospitals into community-based care under a plan
that officials say will eliminate more than 500 jobs, according to the Associated Press. The biggest changes and the layoffs
will come at the Logansport and Richmond state hospitals, while units at the Evansville and Madison hospitals will be converted
to care for those with serious mental illnesses. The moves by the Indiana Family and Social Services Adminstration are expected
to reduce the number of patients at the six state hospitals by about 30 percent and save $15 million a year. The Logansport
State Hospital will have 355 of its 900 workers laid off and 80 vacant positions eliminated. The Richmond
State Hospital will lose 106 of its 600 workers.

A medical device company is seeking a property-tax abatement to offset costs associated with a $1.1 million expansion of
its facility at 3735 N. Arlington Ave. in Indianapolis. New York-based Greatbatch Medical Inc. expects to
create eight jobs at an average wage of $12.75 an hour and retain 146 jobs at an average wage of $14 an hour, according to
the abatement request. Greatbatch specializes in cardiovascular products but is expanding into the orthopedics market, which
is prompting the expansion, the company said.