Consumer group: Insurers kept surplus while hiking premiums

Non-profit Blue Cross and Blue Shield health plans stockpiled billions of dollars during the past decade, yet continued to hit consumers with double-digit premium increases, Consumers Union found in an analysis of 10 of the plans' finances.

Insurers must keep surplus money to ensure they can pay policyholders' medical bills if unexpected market conditions develop. Yet seven of the plans examined held more than three times the amount regulators consider the minimum needed to do that, according to a report being released today by the non-profit consumer group.

Alissa Fox, a senior vice president at the Blue Cross and Blue Shield Association, said this is a "dangerous" time for regulators to limit health plans' surpluses because of great uncertainty about how insurance costs will change under the nation's new health law. "It's a safety net," she said.