LOS ANGELES (KABC) -- On the first day of open enrollment for more than a million Californians, a consumer advocacy group sued Anthem Blue Cross over allegations that the health plan is limiting options and misleading customers.
When melanoma survivor Paul Simon received a notice from his insurer Anthem Blue Cross, he was confused. First it said Anthem was raising his premium 33 percent, but he learned it was also reducing a key part of his PPO, or preferred provider organization, coverage.
"It's devastating," said Simon.
Simon says the 24-page letter also said if he did nothing he would be renewed into similar coverage. But his lawyers with Consumer Watchdog argue the new plan is not similar.
"You cannot renew a policy and convert it from PPO to EPO and that's exactly what the company did," said attorney Jerry Flanagan.
He added that Simon and nearly half a million individual-plan buyers like him are being misled into choosing an EPO or exclusive provider organization plan, instead of a PPO.
"I'm sure for most people there's doctors that they feel comfortable with and they'd like to stick with, so it's just going to cost me a lot more money," said Simon.
"There is no coverage for out-of-network doctors. It is the essential element of a PPO that is being left out of this new coverage," said Flanagan.
Consumer Watchdog announced a class-action lawsuit against Anthem Blue Cross for what they claim is a violation of a federal law requiring specific language to let consumers know the company is essentially canceling one plan and offering another.
"An EPO is not the same as a PPO. It's a glorified HMO," said Leslie Burkes.
She joined the suit because she has a family member with specialized medical needs.
"I'm very, very worried," Burkes said.
Anthem Blue Cross responded by stating: "In an effort to mitigate rate increases and keep monthly premiums affordable, Anthem Blue Cross is changing plans offered to members in many parts of the state from a PPO to an EPO starting on Jan. 1, 2017. The benefit package being offered in 2017 was approved by the Department of Managed Health Care and Covered California."
Anthem Blue Cross also said it is in compliance with federal law and that members were given written notice.
Burkes says all she wants are more options.
"It leaves us without a lot of choices," she said.
Open enrollment for individualized plans started Tuesday and Dec. 15 is the last day to make a change that will take effect Jan. 1.