Anthem asked to justify rate hike in California (AP)

A six-month battle in California over health insurance has come to an end. When health insurer Anthem Blue Cross announced rate hikes last March of up to 39 percent for individual policyholders, it made national news. The Obama Administration weighed in, and the state refused to approve the increase. After examining the company's accounting, California's insurance watchdog has approved a rate hike, though a smaller one.

California's largest for-profit health insurer proposes an average rate hike of 18%, but some Anthem customers may see increase of as much as 25% in February.California's largest for-profit health insurer, Anthem Blue Cross, is seeking to raise rates an average of 18% for more than 630,000 individual policyholders, drawing scrutiny from regulators and the ire of consumers already struggling with soaring premiums.

WellPoint says the 39% increase reflects rising medical costs and that its profit margin in California is 'in line with and below that' of competitors. The parent company of Anthem Blue Cross on Thursday defended its 39% increase in premiums for individual policyholders in California, saying the rising rates reflect soaring medical costs but are "very competitively priced when compared with other California plans."

An investigation in California over dramatic health insurance increases is spurring a federal inquiry. Two congressional committees have asked executives from WellPoint, the parent company of Anthem Blue Cross of California, to explain why the company is raising premiums by as much as 39 percent for some customers.