Kaiser under investigation for unlawful rescissions

[Kaiser's PR statement about halfway through this article is interesting, as usual, because of what it doesn't say. They only stopped illegally rescinding policies in 2006 because they were caught and fined for it. The DMHC is now conducting a more in depth investigation that will reveal the illegal practice for what it is: standard operating procedure at KP and most other insurers.]

From the AP via San Jose Mercury News:

3 insurance companies to have dropped policies reviewed

By SHAYA TAYEFE MOHAJER Associated Press Writer

LOS ANGELES–Three of the state’s largest health insurance companies could be forced to reinstate thousands of dropped policies after a state regulatory agency on Thursday ordered an independent review.

The Department of Managed Health Care ordered the review of dropped policies the last four years by Kaiser Permanente, Anthem Blue Cross and Blue Shield of California.

A partial review of the three companies found that 26 people had been improperly dropped, said agency director Cindy Ehnes. Their policies were ordered reinstated immediately, and the insurance companies were also ordered to reimburse medical costs incurred after their insurance was dropped.

The cases were found in a random review of 286 cases and were “so clearly wrong that they needed to be reinstated right away,” Ehnes said.

Ten were Kaiser Permanente customers, eight from Anthem Blue Cross and eight from Blue Shield of California.

In a statement, Anthem Blue Cross said, “It is important to clarify that the survey found only a relatively small number of rescissions reviewed were improper.”

Kaiser Permanente issued a similar release, adding that the company had suspended the practice of rescissions since October 2006, and was “awaiting clear guidelines from the state.”

The California Association of Health Plans, a trade association representing 40 full-service health plans, issued a statement saying many insurers had made efforts in recent years to self-regulate.
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The trade association also noted that the threat of rescission is limited to the 2.6 million Californians who pay for their own coverage in individual plans, not those covered by their employers’ plans, Medicare, MediCal or other public programs.

Blue Shield declined further comment, saying they deferred to the trade association’s statement.

The regulatory agency’s announcement was applauded by Gov. Arnold Schwarzenegger, who pledged to work with legislators to “ensure this egregious practice is stopped.”

“It’s outrageous that innocent patients have to live in fear of losing their health care coverage,” said Schwarzenegger in a statement.

The order follows a Wednesday superior court filing by Los Angeles City Attorney Rocky Delgadillo, who said he would seek up to $1 billion in fines and restitution from Anthem Blue Cross for deceptive practices and unlawful termination of policies.

In recent months, the city attorney’s office sued another insurer, Health Net Inc., for allegedly canceling the policies of sick patients needing expensive treatment. As part of a separate suit, Health Net was ordered to pay $8.4 million in punitive damages to a woman whose policy was scrapped while she underwent treatment for breast cancer.

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10 comments to Kaiser under investigation for unlawful rescissions

  • Anonymous

    Let me guess… kaiser finds a perceived “lie” on an insurance application which then gives them a “reason” to cancel an “insurance” policy all the while they are perjuring themselves in their many malpractice cases filed against them.

    Hmm, i’d say it’s high time alot of investigations get underway. Why do Kaiser members have to be so honest when filling out applications when kaiser THRIVES on fraud and deception? Decency and the truth is foreign to kaiser, I don’t care what kind of a lame excuse they give for a rescission.

    In addition to people having their policies canceled, Arnold needs to be looking at the many other ways the people of California are being screwed, such as a justice system that condones the “loss” of medical records and allowing false testimony and perjury in kaiser malpractice cases.

    You could look at it this way, a rescission from kaiser might be a blessing in disguise, it might actually SAVE your life and get you out from under the kaiser curse.

  • Quinton Kruse

    Thank you for the work that you do on behalf of all of us.

    Quinton Kruse

  • eric m

    for 3 months we have been ripped apart by kaisers lake of competence. We have been dropped from the policy we were recently on and even had a letter from our Dr’s for a clean-bill-of-health that they asked for, only to receive a denial again, again, and again.

  • james smith

    My wife was dropped from kaiser a couple of months ago because she was one day late on the single check she sent for us both. We have been kaiser members since 1968, 40 years. Can someone help get her reinstated, I have not had any luck with their procedure and her health is failing as I write this. Urgent need of outside help before she passes due to lack of treatment. Kaiser was born without a heart. Respond please, thanks.

  • James

    Watch Sicko and you realize that insurance companies aim for profit. Why are you surprised?

    Get out the country to get your medical treatment. Let Medical tourism thrive.

  • Former Kaiser Exec

    Kaiser was still illegally rescinding policies in mid 2008. I know this for a fact and have all the information necessary to prove it. Kaiser VP Jerry Fleming signed an attestation with DMHC stating that the illegal rescissions had stopped, when in fact they had NOT been stopped and Fleming was fully aware of it.

  • Dr. Shan

    I was dropped from Kaiser in 2003 after 18 years of coverage because of a billing discrpency with a billing agency GHBA. I appeared that despite being paid through 2003, GHBA had not recorded a payment since 2000! After appealing the drop, Kaiser said I needed only to reapply. When I did, they then canceled me for a poor weight-height ratio! The same weight and height I have been since 1986. Their continued response to me, now that Obama is stressing universal health care, is keep applying and maybe our underwriters will change their minds. In the meantime, having had them cancel my insurance, I am not a liability or considered “uninsurable” or “at risk” by other insurers. This has led me to believe I am better off at a local health clinic than with these morons! Sorry to the rest of you dealing with Kaiser.

  • Barbara

    I have been offered a new job; while I have insurance, I cover my husband as a dependent. I wanted to try and convert my Kaiser plan for my husband to one we pay for ourselves because I won’t be using Kaiser myself anymore. I was told by Kaiser that they would reject him because he had a “preexisting condition” (diabetes), even though Kaiser has been treating him for years. I am beyond contempt for Kaiser. Every time I see one of their “Thrive” commercials, I want to kick the TV set in. With this health insurance reform, perhaps it will finally become illegal to reject people. What are we supposed to do, die? This is sick -

  • Diana

    My family’s Kaiser policy was just cancelled because we live “outside the service area” however we have ALWAYS lived here (for 20 years and never lied about it). They have been happy to take our premiums all these years. I had 3 surgeries in the last 2 years. 10 months after the last one we received notice that our policy was terminated. Coincidence? I don’t believe that for a minute!

  • s sloan

    CHEATED OUT OF LIFE.kaiser hospital in walnut creek is where i was born.my mom was told by kaiser when i was brought in at 6 months old with eye problems doctors said i was born with glaucoma in both eyes and lost the site in one eye it wasnt until 30 years later an eye doctor who was examining my eyes asked where did i get all that trauma from i said what trauma he said the big scares across the fronts of both eyes i said i dont know anything about that but kaiser said i was born with glaucoma in both eyes. heres what i found out that day. the doctor said i have seen those exact scars before.he asked if my mom had a dificult delivery i said yes he said ya and those scars across the front of ur eyes are from forcepts my mental state went down hill from there i havent filed suit yet. but my parents said it all makes sence now the doctors lied and covered it up.meanwhile my entire life was ruined from day one as one eye has been dead since i was born and doesnt even look normal i plan on making it VERY PUBLIC.

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