Despite Health Care Reform, Insurers Still Dropping Policyholders

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posted by: Jessica Pieklo 2 days ago


For all those Republicans campaigning on a platform of repealing health care reform, perhaps now is a good time to offer a reminder of the kind of practices the legislation eradicated. The Los Angeles times is reporting that prosecutors are preparing a case against WellPoint Insurance for falsely stating that it had changed its procedures for canceling the policies of patients after they became sick. This process known as rescission effectively left many customers without insurance after developing a chronic condition such as cancer and no means of paying for their care, or, given their diagnosis, no ability to get additional insurance.

WellPoint's disgusting practice first came to light in connection with reports that the company had used a computer algorithm to rescind the policies of women once they were diagnosed with breast cancer. After a litany of bad press reports and public shaming WellPoint promised its policy had changed. But that was apparently not the case.

According to prosecutors, WellPoint continued to target women with breast cancer for rescission, even after the federal healthcare law took effect. Under health care reform, the only allowable basis for rescission of a policy is if the insured lied in the application. Prosecutors believe that WellPoint simply looked for sick clients and kicked them off their policies.

There's only one reason why an insurance company would take away the policy of an insured, and that is if they actually had to being paying out benefits under that policy. The importance of health care reform was to remind insurance companies that they are in the business of paying benefits, not just collecting premiums. It would appear that WellPoint didn't get that memo.
Read more: politics, insurance, breast cancer, health care, WellPoint, rescission

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Wellpoint Continued To Cancel Policies Of Breast Cancer Patients, Despite Company Denials

The Los Angeles Times is reporting that “prosecutors Wednesday accused the parent company of insurance giant Anthem Blue Cross of California of falsely stating that it had changed its procedures for canceling the policies of patients after they become sick.” Wellpoint’s denials, issued earlier this year, were in response to charges that the company used a computer algorithm to rescind the insurance policies of women who were diagnosed with breast cancer:
In an amended civil complaint filed Wednesday in Los Angeles County Superior Court, prosecutors said WellPoint issued three “false and misleading” press releases in April and May to burnish its corporate image as it fended off assertions about its cancellation practices in a news story and criticism from the Obama administration that followed.

The prosecutor’s office contended that WellPoint continued to target women with breast cancer. It said the company also falsely stated that it had changed its procedures this year before the new federal healthcare law took effect. The law bars rescissions nationwide except in cases in which policyholders lie on applications.

Prosecutors acknowledged that WellPoint’s rescissions in California had slowed to a “trickle” but said the Indianapolis company continued to misrepresent itself.

“This is a company that seems willing to say anything — true or not — in order to maintain their profit level,” said Chief Asst. City Atty. Jeffrey Isaacs.

The allegations first came to light in April after a report by Reuters’ Murray Waas revealed that “tens of thousands of Americans lost their health insurance shortly after being diagnosed with life-threatening, expensive medical conditions.” WellPoint “specifically targeted women with breast cancer for aggressive investigation with the intent to cancel their policies.”

Interestingly, today’s prosecutor’s findings come just days after a Congressional report found that health insurers regularly rescinded policies of sicker patients to bolster profits.

Wonk Room Wellpoint Continued To Cancel Policies Of Breast Cancer Patients, Despite Company Denials