SANTA MONICA, Calif., Oct. 27, 2015 /PRNewswire-USNewswire/ -- Under a class action settlement announced today, Anthem Blue Cross in California will no longer make mid-year changes to individual customers' annual deductibles, co-pays, or other out-of-pocket costs and will refund $8.3 million to consumers.
The settlement resolves two lawsuits challenging mid-year changes Anthem made to individual California policies in 2011. The two consolidated lawsuits brought by Shernoff Bidart Echeverria Bentley LLP and Consumer Watchdog were filed in Los Angeles and presided over by Los Angeles County Superior Court Judge Jane Johnson.
The lawsuits alleged that Anthem illegally increased "annual deductibles" and other "annual" and "yearly" out-of-pocket costs, thereby reducing the benefits available under consumers' health plan contracts, in the middle of the year.
All Californians enrolled in individual Anthem health plans will benefit from the settlement provision barring future mid-year cost increases unless there is a change in law or regulation that supports such modifications. Additionally, Anthem will reimburse approximately 50,000 impacted consumers who paid more out-of-pocket due to the 2011 mid-year changes a total of nearly $8.3 million. Consumers do not need to file a claim to receive reimbursement. In December, checks will be mailed to consumers who paid more as a result of the 2011 mid-year changes.
"Anthem should be commended for listening to the heartfelt concerns of its policyholders. This settlement gives consumers the peace-of-mind of knowing that their 'annual' out-of-pocket costs won't change in the middle of the year," said Consumer Watchdog lead attorney Jerry Flanagan.
Consumer Watchdog said the settlement provision protecting consumers from mid-year changes is especially important in the era of Obamacare when consumers may only change health plans once a year during designated "open enrollment" periods.
Download the settlement here: http://www.consumerwatchdog.org/resources/kassouf_taub_-_settlement_agreement.5.29.15_noe.pdf
Consumer Watchdog is a nonpartisan consumer advocacy organization with offices in Washington, D.C. and Santa Monica, CA. Visit us on the web at: http://www.ConsumerWatchdog.org
Shernoff Bidart Echeverria Bentley LLP leads the nation in protecting policyholders from insurance company abuse. The firm has been protecting the rights of insurance consumers, both individuals and businesses, for over 35 years after having set the legal precedent requiring insurance companies to act in good faith. For more information, go to: http://www.shernoff.com
SOURCE Consumer Watchdog