BC Life & Health revoked 1,880 individual health insurance policies in California in 2004 and 2005, and a state agency that examined a sampling says it found that more than half the cases it reviewed were improperly handled.
The Department of Insurance said it studied 83 sample cases and issued citations in 49 of them, alleging 67 violations of fair-claims handling laws.When coverage is rescinded, it is as if the policy never existed, leaving the policyholder and healthcare providers to settle outstanding charges.
"A rescission can be a financial death sentence when you're ill," Poizner said in an e-mail. "In my view, even one improper rescission is one too many. When it comes to rescissions, we are acutely aware that these are people's lives. They're not just numbers to us."
A spokesman said that the department was looking at rescissions industrywide and that BC Life was one of several companies under the microscope. The others include Blue Shield, HealthNet, Cigna and Aetna.
"We've got verification from another department doing its own investigation that this is happening consistently," Liang said. "Clearly, the system is broken…. Patients are getting harmed left and right, and nothing is getting done."
Health insurer cited in policy cancellations - Los Angeles Times
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