Anthem Blue Cross will have to face legal enquiry as consumer advocates filed a class-action suit against it on Monday. Anthem Blue Cross is largest for-profit health insurer of California. It was accused of using drastic rate hikes illegally forcing customers to opt for inferior health plans.

The suit took place two days prior to a meeting that will take place between top executives from several major U. S. health insurers, including Anthem's parent company, WellPoint Inc., in Washington with Obama administration officials for discussing escalating premiums.

Anthem's plan has invited inquiries that will be done by state regulators and congressional committees by raising its individual premiums by as much as 39 per cent.

According to the lawsuit in California, state law was violated by Anthem as it closed certain blocks of its individual health plans to new members. It did not offer comparable coverage to policyholders who opted to remain.

People who want to stay feel trapped by policies that are closed. They have to either accept a plan somewhere else that is affordable or accept lesser insurance.

Mary Feller of San Rafael, Calif., one of the named plaintiffs in the suit filed in Ventura County Superior Court by the advocacy group Consumer Watchdog on behalf of policyholders said, "Blue Cross has a gun to our heads. We could either stay with our old coverage or switch to a new policy with much lower benefits."

No comment came from the insurance company, or from the state Department of Managed Health Care, immediately.