Blue Cross of California, soon to be renamed “Anthem Blue Cross” has released their small group “focal renewal” information and the rate increases seem pretty high. The focal renewal applies to small businesses in California (2-50 employees) who have had continuous coverage with Anthem Blue Cross since December 1, 2003. The rate increase will impact all Anthem Blue Cross (of California) small groups on their annual renewal after May 1, 2008.

Anthem Blue Cross (of California) says that 40% of renewing small group clients enrolled in the “Employee Elect” portfolio of plans will receive “single digit rate increases” meaning a rate increase of less than 10%.

The rate increases among our groups is a bit different. Clearly, our clients represent only a small subset of the tens of thousands of small businesses impacted by the Anthem Blue Cross focal renewal. Nonetheless, this gives you an indication of the size of the rate increase. Our small group clients fall into the following categories

• About 31 percent of our clients will experience an 8-10% rate increase;
• About 38 percent of our clients will experience a 10-14% rate increase;
• About 19 percent of our clients will experience a 17-19% rate increase; and,
• About 12 percent of our clients will experience a 25% rate increase!!

On, you can find the percentage rate increase for each Anthem Blue Cross (of California) small group health plan in California for the May 1, 2008 focal renewal. To read the chart you need to know that Area 5 and Area 9 is Los Angeles County. Alameda and San Francisco County are Area 3, San Diego County is Area 6, the San Jose / Santa Clarita area is Area 2 and 3, and Sacramento area is Areas 2 and 3.

The small group clients receiving the largest increases are groups which have enrolled in the Lumenos HSA-compatible plans. The Lumenos plans will have a 25 – 32 percent rate increase!! Wow, that is a hugh rate increase.

Lumenos was a new plan that Anthem Blue Cross (of California) first introduced in 2007. They were very well priced plans – apparently too well priced. The most popular Lumenos plans are compatible with Health Savings Accounts (HSA). The Lumenos HSA plans have a $1,500 or $3,000 deductible for an employee only (twice that when an employee enrolls with a dependent.) Once the deductible is satisfied the insurance company generally pays 100 percent of medical charges.

Options to offset the Anthem Blue Cross rate increase include changing to another plan by the same insurance company; changing to a different insurance company; or, changing to a lower benefit plan. The Anthem Blue Cross (of California) HSA compatible $2,400/$4,800 PPO plan may be a good alternative to the Lumenos plans. Please call us, 800-472-7307, if you would like to discuss your alternatives. You can also click here to obtain a California small group health insurance plan quote.