by LAS
News stories galore are popping up all over the internet and inside consumer watchdog newsletters. Over the summer, we have been treated to the ultimate whistleblower, Wendell Potter, the former insurance exec who now reveals all the dirty secrets of the industry's program to wrangle the most favorable legislation from our Congress.
This week a slew of similar stories have deflated industry puffery. The New York Times has admitted that it gave the public option short shrift in a one-sided editorial. The editorial went to great lengths to list every objection to the public option without listing even one benefit espoused by its proponents. The media watchdog FAIR received about 1,000 complaints about the editorial. You can read the admittedly short admission on the pages of FAIR dot org here: www.fair.org/index.php?page=3926
Slate carried an article earlier this week bu Robert Reich, who exulted over the way that insurers' have boxed themselves into a corner while trying to fight the prospect of reforms and/or the public option. The intriguing title is “The Audacity of Greed: How Private Health Insurers Just Blew Their Cover.” Reich wrote: “The only reason these costs can be passed on to consumers in the form of higher premiums is because there's not enough competition among private insurers to force them to absorb the costs by becoming more efficient. Get it? Health insurers have just made the best argument yet about why a public insurance option is necessary.” You can read that article now on his blog, at: http://robertreich.blogspot.com/2009/10/audacity-of-greed-how-private-health.html
Then an AP story today, Thu, carried the headline “FACT CHECK: Health insurers cherry-pick facts.” The headline is not at all surprising; most of us are aware that every industry will put forth its views with the most selective data supporting its position. However, it is unusual that the major media will announce such spin-doctoring while the battle rages on. This article points out that a recent industry ad misleads seniors into thinking that cuts are being made to basic Medicare. It is not; what is being cut is Medicare Advantage, the low-cost alternative that is most similar to an HMO. Costs to administer this program have risen much faster than first projected. Yahoo News has the full article which you can read here: news.yahoo.com/s/ap/20091015/ap_on_go_co/us_health_insurers_fact_check;_ylt=Aol4ud6iH0FiULm5ZbK19E8iANEA;_ylu=X3oDMTMwaGJzOTAwBGFzc2V0A2FwLzIwMDkxMDE1L3VzX2hlYWx0aF9pbnN1cmVyc19mYWN0X2NoZWNrBGNwb3MDNwRwb3MDNwRzZWMDeW5fdG9wX3N0b3JpZXMEc2xrA2ZhY3RjaGVja2hlYQ--
In a related matter, PR Watch has written a good article titled: “Put out the FIRE on Capitol Hill with a Consumer Financial Protection Agency.” Do we need yet another government agency? Yes, if we are to curb the abuses committed by the current generation of banks and other financial institutions. Will we get an agency with teeth, if we set up such a watchdog? It is in doubt whether such an agency will see the light of day. Take a look at the political contributions dispensed to certain key members of Congress, to make them more receptive to the industry's views on reforms and oversight.
To quote: “Take Congresswoman Melissa Bean (D-IL), for instance, she is the top recipient on the committee of FIRE campaign finance dollars in 2009. She is also one of the biggest threats to meaningful reform. Evidently, Bean's take away from the financial crisis – which threw 7 million Americans out of work and cost taxpayers $3 trillion – is that consumers need less protection not more. According to watchdogs at Public Citizen, Bean is planning to introduce an amendment to the CFPA bill tomorrow which would take away the right of states to protect consumers more aggressively than the feds.”
This is serious business, folks. You need to voice your support of a financial watchdog agency WITH TEETH so that more Americans do not suffer for the crimes of our financial system.
Thursday, October 15, 2009
Monday, October 12, 2009
Claim Denied? Fighting Back When Your Health Insurance Company Denies Your Claim
by L.A.S.
I have covered some of this topic of how to fight an insurance denial in previous posts. However, let us revisit this topic in view of increased options and assistance now available online. This is good news for healthcare consumers, indeed.
Perhaps you have gotten an questionnaire from your insurer asking if you have other coverage. Let me first say that they need to know if you or your spouse has any other coverage so that they can properly coordinate your insurance coverages. It does not matter which insurance plan is more inclusive or which one you think is primary or secondary. The rules are that the spouse whose BIRTHDAY occurs earlier in the year, has the primary plan. I know this seems dumb but it was just a way of cutting thru a mountain of other possible criteria that was open to dispute and differences of interpretation.
So the insurer has sent you a form asking if you/your spouse has other insurance. Perhaps this is not the first time that they have sent this form. It is possible that your returned form was lost or not entered into the system. It is equally possible that oh my, another year has flown by already and they just need to update their files.
However, if you are getting this form with a letter stating that they have not received a response to a prior request, and you know that you sent that in -- then you need to go into protective mode. Fill out the form as before, making sure it is legible; that means PRINT. Then mail it using the delivery confirmation service offered by the U.S. Postal Service. For less than a dollar, you will be assured that you can prove you sent in the requested information.
I recommend this over the other option, which is a signature delivery. The receiving party can refuse to sign it (this is especially true of vendors who are prone to legal action). Then you have wasted your money for the extra service, and are no further ahead.
Then, your denial letter may NOT be a final denial. It may merely ask for missing information that was not submitted with the original claim or was illegible. Sometimes it is not clear which member of the family is the patient! Calm down enough to read through this letter and zero in on the source of the problem. Often the diagnosis code was not submitted with the claim; you may have to call your physician's office to get that information. It is possible that your provider has gotten a copy of the same letter and has already responded to the request. So stay cool.
There are now some online services that can carry the ball for you if you have had claims denied and you are getting nowhere with normal channels. Please take a moment to check these out and select one that offers specialized attention to your type of problem.
1)The Patient Advocate Foundation is online at Patient Advocate dot org. You may call toll free at 1-800-532-5274.
2)Advocacy for Patients with Chronic Illness is online at Advocacy for Patients dot org. Their phone number is 1-860-674-1370. This organization is directed by Jennifer C. Jaff, who advises you to keep a file and a record of how your doctor determined that you needed a given treatment. She claims a success rate (of appeals of insurance denials) of 80 percent, which is pretty impressive!
3)Most states (46) have procedures for independent review of denials. Connecticut is one. Many of those appeals are also successful. Contact the state insurance commissioner's office as a first step; directions for locating that are given below.
4)A lawyer, if a lot of money is at stake, and you may end up in court anyway for other reasons.
WHAT TO DO IF YOUR CLAIM IS DENIED
First, do NOT pay the bill. You are entitled to an explanation for the denial IN WRITING. The denial letter is sufficient for the insurer to meet that requirement; however, it may be a general form letter and not enlighten you regarding the specific problem. You will have to call their service line and hope to reach a real person.
Get out your copy of the insurance policy and try to locate the verbiage that applies to your claim. There should also be a section of the policy that explains your rights to dispute a denial of a claim. Follow that guideline, and mail your responses using Delivery Confirmation.
If there is missing information that you neglected to enter on a claim form, then just fill it in and re-submit. If it is a matter of a coding error or missing code, then that is something that your doctor's office has to take care of. NOTE: If this is for medical supplies, you may be able to find codes posted on the website for the company that makes or provides your surgical supplies, wheelchair, colostomy supplies, etc.
Other, more complex reasons for a denial can include: You have a pre-existing condition. You have exceeded the lifetime benefit cap. You have changed employers, and need to update your coverage or inform then of the fact that you are utilizing your COBRA benefits option.
Usually the above reasons are not disputable, even though they are unjust. But it is possible that they may have made a mathematical error regarding your total healthcare bills thus far and you have in fact, NOT met the lifetime cap yet. This is something that you can then dispute with them.
Other reasons may also be worth disputing. Perhaps they are disallowing a claim because it was outside the network -- but there was no network facility or physician within a reasonable radius of your home. Perhaps a drug was not FDA-approved for your illness. Sometimes physicians use a drug for an off-label use, and this is a difficult item to dispute with your insurer. However, sometimes there is a similar drug that is made by a different manufacturer that IS covered under your plan. In that case, you may need to discuss with your doctor whether that other drug is appropriate to treat your condition.
Treatment may have been ruled as “unnecessary” “unproven” or “experimental”. The thing I really hate about these terms is that the insurer is allowed to define what they mean. Is a treatment that has been commonly used for twenty years still considered BY THE INSURER as “experimental”? Then I think you have grounds to dispute this decision.
Fighting an insurance company often puts you in the position of trying to research medical issues online and look for articles in medical journals to prove that a given treatment has been shown to be effective. Frankly, most people have a hard time handling that. And it becomes a full-time job in addition to your regular job to continue the effort to win coverage or approval for treatment for yourself or a loved one.
So I recommend that you concentrate on taking care of your own life and hand over this dispute to another party. There are foundations and advocacy groups out there to help you, as well as the state insurance commissioner's office. (You can locate your state office by going to NAIC online, at NAIC dot org. At the left end of the toolbar it says: States & Jurisdiction Map; click on that and a map of the USA and its territories appears. Find your state and click on that. Voila.)
Use my website and the many resources in this article and other articles on this site for help and tips on how to get your money's worth out of your health insurance. And good luck!
I have covered some of this topic of how to fight an insurance denial in previous posts. However, let us revisit this topic in view of increased options and assistance now available online. This is good news for healthcare consumers, indeed.
Perhaps you have gotten an questionnaire from your insurer asking if you have other coverage. Let me first say that they need to know if you or your spouse has any other coverage so that they can properly coordinate your insurance coverages. It does not matter which insurance plan is more inclusive or which one you think is primary or secondary. The rules are that the spouse whose BIRTHDAY occurs earlier in the year, has the primary plan. I know this seems dumb but it was just a way of cutting thru a mountain of other possible criteria that was open to dispute and differences of interpretation.
So the insurer has sent you a form asking if you/your spouse has other insurance. Perhaps this is not the first time that they have sent this form. It is possible that your returned form was lost or not entered into the system. It is equally possible that oh my, another year has flown by already and they just need to update their files.
However, if you are getting this form with a letter stating that they have not received a response to a prior request, and you know that you sent that in -- then you need to go into protective mode. Fill out the form as before, making sure it is legible; that means PRINT. Then mail it using the delivery confirmation service offered by the U.S. Postal Service. For less than a dollar, you will be assured that you can prove you sent in the requested information.
I recommend this over the other option, which is a signature delivery. The receiving party can refuse to sign it (this is especially true of vendors who are prone to legal action). Then you have wasted your money for the extra service, and are no further ahead.
Then, your denial letter may NOT be a final denial. It may merely ask for missing information that was not submitted with the original claim or was illegible. Sometimes it is not clear which member of the family is the patient! Calm down enough to read through this letter and zero in on the source of the problem. Often the diagnosis code was not submitted with the claim; you may have to call your physician's office to get that information. It is possible that your provider has gotten a copy of the same letter and has already responded to the request. So stay cool.
There are now some online services that can carry the ball for you if you have had claims denied and you are getting nowhere with normal channels. Please take a moment to check these out and select one that offers specialized attention to your type of problem.
1)The Patient Advocate Foundation is online at Patient Advocate dot org. You may call toll free at 1-800-532-5274.
2)Advocacy for Patients with Chronic Illness is online at Advocacy for Patients dot org. Their phone number is 1-860-674-1370. This organization is directed by Jennifer C. Jaff, who advises you to keep a file and a record of how your doctor determined that you needed a given treatment. She claims a success rate (of appeals of insurance denials) of 80 percent, which is pretty impressive!
3)Most states (46) have procedures for independent review of denials. Connecticut is one. Many of those appeals are also successful. Contact the state insurance commissioner's office as a first step; directions for locating that are given below.
4)A lawyer, if a lot of money is at stake, and you may end up in court anyway for other reasons.
WHAT TO DO IF YOUR CLAIM IS DENIED
First, do NOT pay the bill. You are entitled to an explanation for the denial IN WRITING. The denial letter is sufficient for the insurer to meet that requirement; however, it may be a general form letter and not enlighten you regarding the specific problem. You will have to call their service line and hope to reach a real person.
Get out your copy of the insurance policy and try to locate the verbiage that applies to your claim. There should also be a section of the policy that explains your rights to dispute a denial of a claim. Follow that guideline, and mail your responses using Delivery Confirmation.
If there is missing information that you neglected to enter on a claim form, then just fill it in and re-submit. If it is a matter of a coding error or missing code, then that is something that your doctor's office has to take care of. NOTE: If this is for medical supplies, you may be able to find codes posted on the website for the company that makes or provides your surgical supplies, wheelchair, colostomy supplies, etc.
Other, more complex reasons for a denial can include: You have a pre-existing condition. You have exceeded the lifetime benefit cap. You have changed employers, and need to update your coverage or inform then of the fact that you are utilizing your COBRA benefits option.
Usually the above reasons are not disputable, even though they are unjust. But it is possible that they may have made a mathematical error regarding your total healthcare bills thus far and you have in fact, NOT met the lifetime cap yet. This is something that you can then dispute with them.
Other reasons may also be worth disputing. Perhaps they are disallowing a claim because it was outside the network -- but there was no network facility or physician within a reasonable radius of your home. Perhaps a drug was not FDA-approved for your illness. Sometimes physicians use a drug for an off-label use, and this is a difficult item to dispute with your insurer. However, sometimes there is a similar drug that is made by a different manufacturer that IS covered under your plan. In that case, you may need to discuss with your doctor whether that other drug is appropriate to treat your condition.
Treatment may have been ruled as “unnecessary” “unproven” or “experimental”. The thing I really hate about these terms is that the insurer is allowed to define what they mean. Is a treatment that has been commonly used for twenty years still considered BY THE INSURER as “experimental”? Then I think you have grounds to dispute this decision.
Fighting an insurance company often puts you in the position of trying to research medical issues online and look for articles in medical journals to prove that a given treatment has been shown to be effective. Frankly, most people have a hard time handling that. And it becomes a full-time job in addition to your regular job to continue the effort to win coverage or approval for treatment for yourself or a loved one.
So I recommend that you concentrate on taking care of your own life and hand over this dispute to another party. There are foundations and advocacy groups out there to help you, as well as the state insurance commissioner's office. (You can locate your state office by going to NAIC online, at NAIC dot org. At the left end of the toolbar it says: States & Jurisdiction Map; click on that and a map of the USA and its territories appears. Find your state and click on that. Voila.)
Use my website and the many resources in this article and other articles on this site for help and tips on how to get your money's worth out of your health insurance. And good luck!
Q: Are Insurers Practicing Medicine Without A License?
by L.A.S.
One of the odder results of our reliance on private health insurers is that insurers are in fact making medical decisions. Those decisions are removed from the doctor-patient relationship. Yet while the insurers claim that they are making decisions on PAYMENT, and not on approving or denying the actual medical treatment, the fact is that in the end, insurers' decisions determine whether patients live or die.
This raises the questions then, whether insurers are practicing medicine without a license!
Who gave them this authority?
If the insurance industry were handed the job now of covering medical claims (as they way were back in 1919), would they be able to get away with it?
I wish someone would file a lawsuit and find out if we consumers can set things to rights.
One of the odder results of our reliance on private health insurers is that insurers are in fact making medical decisions. Those decisions are removed from the doctor-patient relationship. Yet while the insurers claim that they are making decisions on PAYMENT, and not on approving or denying the actual medical treatment, the fact is that in the end, insurers' decisions determine whether patients live or die.
This raises the questions then, whether insurers are practicing medicine without a license!
Who gave them this authority?
If the insurance industry were handed the job now of covering medical claims (as they way were back in 1919), would they be able to get away with it?
I wish someone would file a lawsuit and find out if we consumers can set things to rights.
Insurers attacking healthcare reform bill with heavy lobbying
by L.A.S.
This is no surprise, but insurers are fighting back hard against prospects of real healthcare reform that may or may not include a public option.
Their latest gambit is a claim that this reform movement would add hundreds of dollars to the cost of insurance coverage, contrary to the claim by the reformers that pitching a bigger tent to cover more people (including young, healthy people who currently do not feel they need health insurance) will reduce the cost of covering everyone else.
To quote the article: “The (insurers) study projected that in 2019, family premiums could be $4,000 higher and individual premiums could be $1,500 higher.
Baucus spokesman Mulhauser said the study is "seriously flawed" because it doesn't take into account provisions in the legislation that would lower the cost of coverage, such as tax credits to help people buy private insurance, protections for current policies and administrative savings from a revamped marketplace.
White House health care spokeswoman Linda Douglass concurred. "This is an insurance industry analysis that is designed to reach a conclusion which benefits the industry, and does not represent what the bill does," she said.” [end of quote]
You can read the whole article (per Newsvine feed) at www.newsvine.com/_news/2009/10/11/3372624-insurers-mount-attack-against-health-reform
This is no surprise, but insurers are fighting back hard against prospects of real healthcare reform that may or may not include a public option.
Their latest gambit is a claim that this reform movement would add hundreds of dollars to the cost of insurance coverage, contrary to the claim by the reformers that pitching a bigger tent to cover more people (including young, healthy people who currently do not feel they need health insurance) will reduce the cost of covering everyone else.
To quote the article: “The (insurers) study projected that in 2019, family premiums could be $4,000 higher and individual premiums could be $1,500 higher.
Baucus spokesman Mulhauser said the study is "seriously flawed" because it doesn't take into account provisions in the legislation that would lower the cost of coverage, such as tax credits to help people buy private insurance, protections for current policies and administrative savings from a revamped marketplace.
White House health care spokeswoman Linda Douglass concurred. "This is an insurance industry analysis that is designed to reach a conclusion which benefits the industry, and does not represent what the bill does," she said.” [end of quote]
You can read the whole article (per Newsvine feed) at www.newsvine.com/_news/2009/10/11/3372624-insurers-mount-attack-against-health-reform
Sunday, September 27, 2009
A Minnesotan Reports on the Canadian National Health Experience
by L.A.S.
When Minnesotan Bob McIntosh moved to Victoria, British Columbia, two years ago, he expected long waits for medical attention. But to his surprise, he was shown to a doctor's office after only 20 minutes in the waiting room of a local walk-in clinic.
Service was not only fast but friendly. The building is less imposing than most facilities in the U.S., and clinic rooms might be described as spartan. Yet patients can depend on everything that counts where medical services are concerned, and so it merits serious consideration as a basis for an American plan.
Contrary to what most sources would have you believe, the coverage is not exactly free and excludes some allied health services.
Mr. McIntosh reports that Canadians there pay a monthly premium of just $100. That premium is waived for those who cannot afford it. The national health plan, called Medicare, does include clinic visits, annual checkups, and most lab work. Not covered are a PSA test ($30), eyeglasses, dental care, acupuncture, physiotherapy, massage, chiropractic, non-surgical podiatry, and the like.
The Medicare program is administered by the provinces. That means if a resident of British Columbia travels to another province or country, he needs supplemental insurance. McIntosh found such a plan for another $88 a month, but many people get such coverage provided by their employers.
Why can't the powers-that-be in this country accept the irresistible logic of a national healthcare plan? Perhaps they like seeing huge, luxurious hospital wings with their names on a plaque up front. And they like even better the large inflow of money each month from insurance policyholders and annual bonuses for denying medical care to those who need it.
When Minnesotan Bob McIntosh moved to Victoria, British Columbia, two years ago, he expected long waits for medical attention. But to his surprise, he was shown to a doctor's office after only 20 minutes in the waiting room of a local walk-in clinic.
Service was not only fast but friendly. The building is less imposing than most facilities in the U.S., and clinic rooms might be described as spartan. Yet patients can depend on everything that counts where medical services are concerned, and so it merits serious consideration as a basis for an American plan.
Contrary to what most sources would have you believe, the coverage is not exactly free and excludes some allied health services.
Mr. McIntosh reports that Canadians there pay a monthly premium of just $100. That premium is waived for those who cannot afford it. The national health plan, called Medicare, does include clinic visits, annual checkups, and most lab work. Not covered are a PSA test ($30), eyeglasses, dental care, acupuncture, physiotherapy, massage, chiropractic, non-surgical podiatry, and the like.
The Medicare program is administered by the provinces. That means if a resident of British Columbia travels to another province or country, he needs supplemental insurance. McIntosh found such a plan for another $88 a month, but many people get such coverage provided by their employers.
Why can't the powers-that-be in this country accept the irresistible logic of a national healthcare plan? Perhaps they like seeing huge, luxurious hospital wings with their names on a plaque up front. And they like even better the large inflow of money each month from insurance policyholders and annual bonuses for denying medical care to those who need it.
Saturday, September 26, 2009
Wouldn't You Love to Have 100 Percent Income Replacement thru Your Disability Insurance?
by LAS
Wouldn't we all love to be assured of full income replacement if we were disabled, either short term or long term? Well, unfortunately Americans cannot get that kind of coverage, at least not if they live in the United States.
I viewed the film Sicko again and there was so much covered in there, that it was difficult to sort out all the issues. But one of the issues apart from those related to health insurance was the matter of disability insurance.
Here in the United States, one cannot get more than about 60 or 65 percent income replacement through a disability policy, whether from a private policy or through the federal government's SSI program. It is felt that people should not profit by getting injured or disabled. Well, they should not be forced to choose between rent and food, or rent and medications -- and so many of those on disability rely on several medications just to get through the day.
Tony Benn was quoted in Sicko as saying that choice depends on freedom to choose, and if you are shackled with debt, then one does not have the freedom to choose. I might add that if you are shackled with healthcare bills beyond your ability to pay, then you do not have choice or the freedom to choose, either.
But in France, the law requires that disabled people receive full pay while on disability. The government pays 65 percent, and your employer pays 35 percent. Sicko related the story of a Frenchman who was too exhausted after a course of chemo to go back to work right away, so his doctor gave him a note for a three-month leave. So the guy goes on vacation, soaks up some sun and recoups his old energy, and voila, he's a new man again.
So if you should be so lucky as to work for the French office of an American corporation, you could reap the best of both worlds. American pay with French social security -- real social security, not just a retirement check that won't cover rent, but retirement, healthcare, disability, full maternity coverage, and more.
I have read that recent years have found the French hard-pressed to pay for rising expenses even in a system that pays its doctors well but not extravagantly. Perhaps they will have to cut the less necessary fringe items like paying for vacations, or for college beyond the first two years, or or home services for new mothers.
But I sure hope that the French maintain their militant insistence that even foreign corporations have to obey French labor laws. Someone has to keep the corporations in line. And if the French will do the job, then more power to them.
Wouldn't we all love to be assured of full income replacement if we were disabled, either short term or long term? Well, unfortunately Americans cannot get that kind of coverage, at least not if they live in the United States.
I viewed the film Sicko again and there was so much covered in there, that it was difficult to sort out all the issues. But one of the issues apart from those related to health insurance was the matter of disability insurance.
Here in the United States, one cannot get more than about 60 or 65 percent income replacement through a disability policy, whether from a private policy or through the federal government's SSI program. It is felt that people should not profit by getting injured or disabled. Well, they should not be forced to choose between rent and food, or rent and medications -- and so many of those on disability rely on several medications just to get through the day.
Tony Benn was quoted in Sicko as saying that choice depends on freedom to choose, and if you are shackled with debt, then one does not have the freedom to choose. I might add that if you are shackled with healthcare bills beyond your ability to pay, then you do not have choice or the freedom to choose, either.
But in France, the law requires that disabled people receive full pay while on disability. The government pays 65 percent, and your employer pays 35 percent. Sicko related the story of a Frenchman who was too exhausted after a course of chemo to go back to work right away, so his doctor gave him a note for a three-month leave. So the guy goes on vacation, soaks up some sun and recoups his old energy, and voila, he's a new man again.
So if you should be so lucky as to work for the French office of an American corporation, you could reap the best of both worlds. American pay with French social security -- real social security, not just a retirement check that won't cover rent, but retirement, healthcare, disability, full maternity coverage, and more.
I have read that recent years have found the French hard-pressed to pay for rising expenses even in a system that pays its doctors well but not extravagantly. Perhaps they will have to cut the less necessary fringe items like paying for vacations, or for college beyond the first two years, or or home services for new mothers.
But I sure hope that the French maintain their militant insistence that even foreign corporations have to obey French labor laws. Someone has to keep the corporations in line. And if the French will do the job, then more power to them.
Remember the Part in 'Sicko' When Sick People Had Policies Canceled Back to Starting Point?
by LAS
The Michael Moore film Sicko threw light on many kinds of problems that ordinary people have with their health insurers. One such problem is rescission, where a company decides that it issued a policy in error (often claiming the policyholder lied or omitted required information on the application), and cancels that policy all the way back to its starting date.
This sticks the hapless policyholder with all the bills that the insurer had paid while the policy was in force. Sicko related the story of one such victim of the rescission power, who had omitted a history of yeast infection and was stuck with a $7000 surgery bill for an unrelated illness. NAIC, the regulating body for the insurance industry, has decided to take steps to curb abuse of rescission and bolster consumer protection.
NAIC sent a letter to the House Energy and Commerce Subcommittee on Oversight and Investigation. In this letter, NAIC outlined its plan to analyze rescission-related consumer complaints, and develop procedures for external reviews of these rescissions. It stated that it is determined to prevent abuses of the rescission authority, which is used by insurers to cancel policies that it decides were issued in error.
It is nice to see that Moore's film has prodded NAIC to at least examine the practice of rescission and promise to improve consumer protection. We will see what comes of this, or whether the industry will pull the teeth out of any attempts to regulate itself.
The Michael Moore film Sicko threw light on many kinds of problems that ordinary people have with their health insurers. One such problem is rescission, where a company decides that it issued a policy in error (often claiming the policyholder lied or omitted required information on the application), and cancels that policy all the way back to its starting date.
This sticks the hapless policyholder with all the bills that the insurer had paid while the policy was in force. Sicko related the story of one such victim of the rescission power, who had omitted a history of yeast infection and was stuck with a $7000 surgery bill for an unrelated illness. NAIC, the regulating body for the insurance industry, has decided to take steps to curb abuse of rescission and bolster consumer protection.
NAIC sent a letter to the House Energy and Commerce Subcommittee on Oversight and Investigation. In this letter, NAIC outlined its plan to analyze rescission-related consumer complaints, and develop procedures for external reviews of these rescissions. It stated that it is determined to prevent abuses of the rescission authority, which is used by insurers to cancel policies that it decides were issued in error.
It is nice to see that Moore's film has prodded NAIC to at least examine the practice of rescission and promise to improve consumer protection. We will see what comes of this, or whether the industry will pull the teeth out of any attempts to regulate itself.
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