The cost of medical care has risen just 3.6% but insurers in California are raising rates on individual policy holders 8 to 14%. 
Anthem, California's largest for-profit health insurer,  is proposing premium increases ranging from 9.6% to 13.8% on average, effective May 1 or July 1, for about 700,000 individual policyholders and their families. The rate increases are under review by state officials.

Kaiser Permanente, a non-profit insurer increased premiums 9% on average for nearly 300,000 customers in January.  Another non-profit, Blue Shield of California is raising rates by between 7.9% and 8.9% March 1st. 
Insurers say the hikes reflect their knowledge of their client base, not the cost of medical care.

Consumer groups are not buying it.  These increases come directly after last years’ increases which ranged from 20 to 30%, and ignited a battle between the industry and consumer groups which may lead to a ballot measure seeking increased rate regulation.

In California, regulators do not have the power to turn down a rate request, but insurers do have to meet certain mathematical equations in order to have them approved.  The state was successful in persuading Blue Shield to reduce their increase from 14.8% to 8.9%.  They also recently got Aetna to reduce an increase from 13.7% to 9.3%.

There is no word as to whether the Feds will hold up these rates to take a closer look as they have in other states.  The CFPB has reviewed some rate increases nationwide, but certainly not in large numbers.   And certainly not all the ones that they were entitled to review.

As 2012 passes, more and more of the national healthcare reform bill goes into effect.  How it will effect these rate increases and future ones is difficult to know at this point.  Later in the year, the federal provision limiting insurers’ expenses on non-medical costs goes into effect.  It is possible that in 2013 that some of these rate increases could be rebated, if the firms do not spend the required amount on direct medical costs, as required by the law.

These rate increases are for Californians who have individual polices, not those who are part of group plans.  According to the Kaiser Family Foundation, those rates rose 9% last year nationwide.

The proposed ballot measure would give the state the same right to reject rate increases that they have for auto and property policies.  Advocates need 505,000 signatures by May 1st to qualify for the November election.