Health insurer WellPoint Inc. has reduced its proposed premium increase for individual policy holders in California and will delay co-pay and deductible increases until Jan. 1.

WellPoint's Anthem Blue Cross unit has reduced its proposed rate increase to an average of 9.1 percent from a previous proposal amounting to an increase of 16.4 percent, Dave Jones, California's insurance commissioner, said on Monday. The reduced rate hike will save about $40 million for about 600,000 individual and family policyholders in the state, Jones said.

WellPoint's proposed rate increases in California last year set off a national debate over the spiraling cost of healthcare coverage that Democrats seized on to build momentum for the healthcare overhaul law.

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