California Department of Insurance Freezes PacifiCare Dividend Payment
The California Department of Insurance (DOI) has frozen a $120 million dividend PacifiCare planned to pay its parent company UnitedHealth Group, explaining that the DOI would rather the money remain in California while it investigates hundreds of consumer complaints about improper claims handling. PacifiCare is charged with nearly 1 million violations, and may have to pay either $5,000 or $10,000 per violation.
“Nobody knows what the outcome of the enforcement action will be, but it is entirely possible that allowing United to siphon off $120 million would enable them to turn penalties into profits. My order simply requires that the company keep the money where it would be available to satisfy any order that is issued,” said California Insurance Commissioner Steve Poizner in a press release.