Insurers will pay $13 million total to settle claims

highway80west · 07-18-2008, 11:36 AM

Insurers will pay $13 million total to settle claims | The San Diego Union-Tribune

Tirya · 07-18-2008, 11:46 AM

Related stories:

Anthem Blue Cross sued over rescissions - Los Angeles Times

Quote:

"It's fantastic -- nobody should have to deal with this," said Jennifer Thompson. Blue Cross dropped the 61-year-old Palm Desert real estate agent last December after she had a hysterectomy for endometrial cancer that the health plan had approved in advance. Thompson was left with about $160,000 in medical bills and without insurance for the first time in her life.

Blue Cross, she said, told her it dropped her for failing to disclose on her application that she had had breast cancer 11 years earlier. Thompson said the application had asked for 10 years of medical history. Still, she said, she asked the agent whether she needed to include the information and he told her no.

Three days after arriving home from the surgery, "I received a letter from Blue Cross telling me they were pulling the rug out from under me," she said. "It was right before Christmas. It was a great gift."

Court backs rights of insured - Los Angeles Times

Quote:

In the Haileys’ case, Blue Shield rescinded Steve’s policy after authorizing more than $450,000 worth of hospital and other medical care. The insurer also demanded that he repay more than $104,000 it spent on his behalf.

Blue Shield contended that Hailey lied on his application about preexisting conditions, failed to disclose a recent emergency room visit and shaved about 45 pounds off his weight.

[...]

The court also said that facts of the case “raise an inference that Blue Shield may have acted in bad faith by delaying its decision to rescind the policy.”

[...]

The court also highlighted the testimony of Blue Shield’s underwriting investigator that the company referred about 1,000 claims a year to her for investigations of possible application omissions and misstatements. Yet, the court wrote, the investigator said she rescinded less than 1% of them.

“These facts raise the specter that Blue Shield does not immediately rescind health care contracts upon learning of potential grounds for rescission, but waits until after the claims submitted under that contract exceed the monthly premiums being collected,” the court wrote.

It will be interesting to see if insurers other than Blue Cross and Blue Shield will be investigated for illegal recissions, in California and elsewhere.

garysher · 07-18-2008, 04:31 PM

Quote:

Originally Posted by Tirya

It will be interesting to see if insurers other than Blue Cross and Blue Shield will be investigated for illegal recissions, in California and elsewhere.

July 18, 2008
A congressional committee will investigate health insurers' practice of canceling coverage when policyholders get sick, its chairman said Thursday.

The problem first came to light in California, but witnesses testifying before the House Oversight and Government Reform Committee suggested that it was more widespread.

The problem affects the individual insurance market, in which 14 million Americans, including nearly 3 million Californians, purchase medical benefits on their own.

In light of proposals to expand the individual market, the committee's chairman, Rep. Henry A. Waxman (D-Beverly Hills), said the individual market demanded more scrutiny, especially of cancellation practices.

Waxman pointed to one case in which he said a consumer lost his insurance because he failed to disclose headaches on his application for coverage.

He "was terminated because the insurer said he should have known that occasional headaches would later be diagnosed as multiple sclerosis," Waxman said.

Congressional committee will probe health insurers that cancel sick members' coverage - Los Angeles Times

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