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'Rescissions': The neutron bomb of health insurance
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| Parent(s) |
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| Contributor | Servo |
| Last Edited | Servo Jun 26, 2009 10:37am |
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| Category | News |
| Author | Walter Updegrave and Kate Ashford |
| News Date | Tuesday, February 13, 2007 04:00:00 PM UTC0:0 |
| Description | Waiting for an overdue reimbursement check is a hassle. Finding that your health insurance has been nullified after you've incurred serious medical costs can be an outright catastrophe.
Called "rescissions," such ex-post policy denials are rare - insurers say they affect only about 1 percent of individual policyholders (they don't occur in employer-sponsored group plans) - but the practice appears to be growing.
Last year, for example, California regulators launched investigations into the rescission practices of Blue Shield, Health Net, PacifiCare and other providers.
Meanwhile, the Connecticut Department of Insurance is also investigating Assurant Health after 15 of 20 complaints to the state attorney general involved its use of retroactive denials of coverage. (Assurant asserts that it enacts rescissions only when policyholders don't provide truthful or complete information during enrollment.)
Rescission is, in effect, the neutron bomb of health insurance. If you're hit by one, you're not only left without insurance to cover the illness at hand, but you're also liable for your previously paid claims. |
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