Nightly News   |  February 24, 2010

WellPoint blasted for insurance rate hikes

The health insurance company Wellpoint was in the hot seat Wednesday over its recent decision to raise premiums for some policyholders. NBC Senior Investigative Correspondent Lisa Myers reports.

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>> $150 million acquisition.

>>> toyota executives weren't the only ones under fire on the hill today. the health insurance company wellpoint was in the hot seat over its recent decision to hike premiums for some policy holders by a lot. our story tonight from nbc's lisa myers .

>> reporter: three californians, all relatively healthy, recently were notified their health insurance premiums are going up as much as 39% this year.

>> there's reasonable and then there's outrageous.

>> reporter: for jeremy arnold it's the second huge increase.

>> my premiums are poised to rise to a level a whopping 74% higher than barely over a year ago.

>> reporter: today congress demanded an explanation from the insurance giant wellpoint, whose subsidiarilessied the big increase on hundreds of thousands of individual policy holders in california, and is reported to have proposed double-digit rate hikes in 11 states.

>> a 39% rate increase at a time when people americans are losing their jobs is so incredibly audacious.

>> reporter: wellpoint's ceo angela bradley.

>> we are fighting every day to make sure we can make their health benefits more affordable.

>> reporter: she blamed the increases on soaring medical costs and too many healthy young people dropping their coverage.

>> we don't like raising our rates that much. we know it's a hardship on these people.

>> reporter: democrats criticized the company spending millions on lavish retreats at ritzy resorts and cited internal company e-mails that tied increase to company profits. brailey argued their profits are margin compared to other sectors of the economy.

>> i don't mind you making a profit but at the end of the year 2009 , you still made $2 billion something and that's not enough?

>> reporter: today they summoned ceos of five major insurance companies to meet next week to explain why premiums are going up faster than medical costs. lisa myers , nbc news, washington.

>> all of this sets the scene for tomorrow's summit on health care , with president obama , congressional democrats and republicans all together, one room, six hours at blair house across from the white house , with only a break for lunch. it starts tomorrow morning at 10:00 eastern. msnbc will carry it live. you can watch it stream live on our website