California Insurance Lawyer Blog

Do you, or does someone you know have a Long Term Care Policy from a n insurance company that refused to pay benefits? Was that denial based upon the fact that the agency providing care was not "licensed" or "approved?" We are seeing this more and more, and we are suing these companies on behalf of our clients.

The insurance companies twist the language of these policies so as to argue that care providers must be licensed by the State of California. The fact is, however, California does not require licensing for certain classes of care providers, and they couldn't get licensed by the state even if they wanted to! Most of these policies contain provisions which pay for "Home Health Care Services," or services from a "Home Health Care Agency." Sometimes, the benefits are characterized as "Personal Care Services" or "Instrumental Activities of Daily Living."

Companies we've seen denying benefits on grounds the agency is not licensed include Conseco Senior Health, Senior Health Insurance Company (SHIP), Transport Life, American Travelers Life and others.

Don't let these companies get away with not paying you benefits! Call us. We don't charge for an initial interview, and if we take the case, it will be on a contingency, so you won't have to pay attorneys fees on an hourly basis.

800-446-7529

Last October we blogged about a promising development in the treatment of chronic fatigue syndrome. Researchers believed they had discovered a retrovirus similar to the HIV virus as the culprit behind chronic fatigue and as a result would soon be able to treat the disorder with antiretroviral drugs. See “ XMRV Virus May Be Cause of Chronic Fatigue.” People with chronic fatigue tested for XMRV, and some began taking the toxic drugs used to treat AIDS. Now it appears the optimism was premature.

As many as five research teams attempting to confirm the finding say they have been unable to locate the XMRV virus in people suffering from chronic fatigue, reports the Los Angeles Times, “The Push and Pull Over a Chronic Fatigue Syndrome Study.” http://www.latimes.com/news/health/la-he-chronic-fatigue-20100614,0,6928481.story.

The U.S. Centers for Disease Control and Prevention has estimated that as many as 4 million people in the U.S. – most of them women -- have the disease. Chronic fatigue cannot be diagnosed with any known lab test and no FDA-approved drug has been developed to treat it. That’s why the isolation of a possible cause and treatment caused such high hopes for people with the disorder.

Immunologist Judy Mikovits, lead author of the paper about the XMRV virus published in Science, says the research teams are biased. She calls the XMRV infection possibly “the worst epidemic in U.S history.” She told the Times her finding is “being ignored by a dithering, even hostile scientific world.”

“Even the best scientists can be wrong,” writes reporter Trine Tsouderos. “Findings must be tested and confirmed by other researchers before they can be trusted. And that has yet to happen for XMRV and chronic fatigue syndrome.”

Disability insurers will likely use this debate over the cause of chronic fatigue to delay and deny claims from people with the disorder, some who have been fighting for years to get their physical suffering acknowledged. Still, the fact that so many researchers are now attempting to prove Dr. Mikovits either right or wrong could lead to scientifically tested and approved ways to diagnose and treat chronic fatigue.

If you suffer from chronic fatigue syndrome and have been denied health or disability insurance benefits, call us at (800) 446-7529. We have years of experience helping people with chronic fatigue and similar conditions appeal benefit denials or challenge insurers or health plans in court, particularly when insurers refuse to acknowledge the seriousness of their disease.

Medical researchers have developed a new way to diagnose the painful disorder fibromyalgia, according to a recently published study. Using a pain index and a measure of key symptoms and severity, medical doctors may soon be able to diagnose the condition with more accuracy and begin treatment options sooner. See, “A New Way of Diagnosing Fibromyalgia.”

Diagnosing fibromyalgia has long been a problem within the medical community. Fibromyalgia is usually determined by administering “tender point” exams that document pain or tenderness on at least 11of 18 specified points during a three month period. But doctors who are not rheumatologists are uncomfortable with exam, which isn’t fail-safe, said Robert Katz, MD, a rheumatologist and professor of medicine at Rush University Medical Center in Chicago and author of the study. As a result, people with symptoms commonly associated with the fibromyalgia were often told by their doctors that the problem was “all in their heads.”

All that is not lost on disability insurers, who tend to deny claims from people suffering with fibromyalgia, particularly when policyholders cannot get a clear diagnosis of their condition.

The new diagnosing criteria, already approved by American College of Rheumatology, avoid the tender point exams. Instead, a 19-point pain index and severity scale is administered. A patient marks the number of body parts where she has experienced pain during the last week. Typical fibromyalgia symptoms such as unrefreshing sleep, fatigue, and cognition are rated on a scale of severity from 0 to 3. The physician completes the diagnosis based on the number of painful areas and number of symptoms and their severity.

Dr. Katz predicts that once the new diagnosis criteria are in use, the number of recognized cases of fibromyalgia could double or even triple.

All this is good news for people who believe they are suffering from the painful symptoms of fibromyalgia but have never been officially diagnosed with the disease. On the other hand, they may be in for a shock if and when they file disability claims. We predict that carriers won’t readily agree that this new way to diagnose fibromyalgia is superior to previous methods and will still make Firbo sufferers fight to get the benefits they deserve.

The new federal healthcare legislation could bestow broad new powers on California’s next insurance commissioner, already one of the nation’s most powerful jobs of its kind, reports the Los Angeles Times. “Healthcare reform raises the stakes in California insurance commissioner election.” Four candidates are running for their parties’ nominations in the June 8 primary election -- Democrats Dave Jones and Hector De La Torre, and Republicans Brian D. Fitzgerald and Mike Villines – and the winner of the June 8 primary will face four other minor party candidates in November.

In addition to new authority under federal law, the insurance commissioner may gain the regulatory powers currently under the charge of the California Department of Managed Healthcare, which oversees health maintenance organizations, if the Legislature approves and the governor signs a bill that would shift all regulatory power to the commissioner.

This year’s insurance commissioner race is one of the most important in the state’s history.

We support Democrat Dave Jones, who proved a strong consumer advocate while serving as a California Assemblymember. In addition to supporting the regulatory shift from the Department of Managed Healthcare, Jones wants California lawmakers to give the commissioner the power to approve or reject insurer requests for rate increases, subjecting health insurance rates to the same detailed approval process that applies to automobile, home and other types of property and casualty insurance.

“I’ll be working to impose rate regulation on health insurance and healthcare plans to rein in the excessive rate increases that have afflicted California consumers year after year for the past 10 years,” Jones told the Times.

We believe Jones has the experience, leadership skills and ability to protect consumers as insurance commissioner, as well as hold insurance companies accountable when they break the law or deny benefits their customers rightfully deserve. From what we have seen thus far, he is fully capable of fulfilling the challenges facing the state and the insurance industry during the next four years and of building a bureaucracy that works in the consumers’ interests.

Bloomberg’s Businessweek reports that fewer workers are filing disability claims during this down economy, fearing their jobs won’t be available when they are able to return to work. See “Ailing Workers ‘Gut It Out’ on Job, Opt Against Disability.”
Although this trend appears to mainly affect workers with “lower back pain, nervous conditions and ‘more discretionary’ claims,” it’s unclear how many employees might be seriously injuring their long-term health by remaining on the job. Disability insurance typically pays only 60 percent of an employee’s salary.

One thing IS clear, however: This is really good news for disability insurers. For example, Unum has posted increased profits for five straight quarters, boosted its dividend and approved a $500 million share repurchase program.
“You can’t make a windfall on these products,” Unum Group Chief Executive Officer Thomas Watjen told Businesweek. “It’s not like you can go on claim and make an enormous amount of money.”
In one sentence, Mr. Watjen confirms the argument we make every day for our clients suffering from disabling conditions: If they weren’t sick, they’d be at work. It pays better. That is something we’ll be sure to remind Mr. Watjen’s representatives each time they make a policyholder fight for his or her benefits.

A New York Times editorial documents the next health insurance battleground: medical loss ratios, the amount of premiums spent on patient care as opposed to administrative costs and profits. See “The Gaming Begins.”

The federal health reform legislation mandates that by 2011 health insurers must spend 80 to 85 percent of premiums on medical services or activities that improve the quality of care. The legislation, however, doesn’t specifically define what activity will qualify as an improvement in the "quality of care." That leaves plenty of room for carriers to manipulate the process and circumvent the true intent of the legislation.

According to the article, Sen. Jay Rockefeller, a democrat from West Virginia, has found insurers are already classifying many administrative costs as medical expenses. He wants Congress to impose a rigorous standard. The New York Times is advocating sensible boundaries that exclude technologies and programs that merely streamline operations.

For example, insurers want to include the cost of setting up provider networks and programs that deter fraud and overbilling in the patient care ratio. Most people, however, would consider those administrative activities.

It’s clear to us that someone at the federal or state level must monitor carrier decisions to blur the lines between patient care and administrative costs so health care reform can remain the true reform Americans counted on.

Los Angeles Times business columnist Michael Hiltzik recently wrote about retired state employees who purchased a long-term care insurance policy in 1997. Unfortunately, like many others who had purchased long term care insurance years ago, the couple could no longer afford the insurance because premiums had increased 100 percent. See, “Long-Term Care Policies: Pouring Money Down a Hole?” http://www.latimes.com/business/la-fi-hiltzik7-2010apr07,0,7567632.column.
Many people who believed they were responsibly planning for the future by purchasing long-term care insurance in the late 1980’s or early 90’s are encountering this problem: Almost every insurer selling long-term care products at that time underpriced their policies. As a result during the past decade, these carriers have successfully obtained approval from state agencies to raise the premiums for their products. It is not unusual for a premium increase to be 40 percent to 50 percent of the original price. Unfortunately, these increases come at a time when many of the policyholders are now on a fixed income and cannot afford the increased cost.
Policyholders who purchased policies before 1993 may have another critical but less publicized issue in addition to substantial premium increases: outdated protection. If policyholders purchased “nursing home” only policies, their insurance carriers will likely contend the policies do not cover the more popular assisted living facilities.
Additionally, a policyholder may have purchased a “home healthcare” benefit policy, which is intended to pay for services rendered by a home healthcare aide in one’s “home.” Although an insured may have relocated his or her residence to an assisted living facility, a carrier may not pay because it contends that the facility is not the insured’s “home.”
At Kantor & Kantor, we provide assistance to those policyholders who have been unfairly denied benefits under long-term care policies, and we have successfully argued that benefits cover assisted living facilities. If your long-term care insurer has denied benefits based on policy language, we can help.

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Looking for an interesting book to read? How about the book "Nudge." It was co-authored by Cass Sunstein (Harvard Law School) and Richard Thaler (Univ. of Chicago Business School), and presents various ideas about helping consumers improve decisions about health, wealth and happiness.

Among other things, the book has a brief ERISA discussion. While its focus is on retirement more so than disability, the principles the authors raise are virtually the same. The authors write:

“ERISA sets forth three fiduciary principles for retirement-plan investments: the exclusive benefit rule, requiring that plans be managed exclusively for the benefit of participants; the prudence rule, requiring that plan assets be invested according to a ‘prudent investor’ standard; and the diversification rule, requiring that plan assets be diversified so as to minimize the risk of large losses. Most notably, company stock is exempted from the diversification requirement in defined-contribution plans—largely because, at the time ERISA was passed, large employers with profit-sharing plans lobbied Congress to exempt them from the diversification requirements imposed on defined-benefits plans. Employers are still expected to act prudently, however, in determining whether company stock is a suitable investment.”

The authors go on to explain how perverse this is from a workers’ welfare perspective. Diversification is key to a healthy investment portfolio, yet employers have an interest in seeing that their companies’ stock performs well and those profits are shared, even when this may hurt employees’ retirement funds.

Sunstein and Thaler explain: “The primary incentive problems in this context are possible conflicts of interest between the employer and the employee. The issues regarding company stock are a good example. The ERISA laws already require firms to act in the best interest of the employees. These laws should be enforced.”

Similarly, ERISA requires disability and health plan administrators and/or insurance companies to operate in the best interest of employees. However, often there is a conflict between paying claims for disabled or sick employees, and maximizing profits for shareholders of the insurance companies, which will be affected by payouts on insurance claims. This conflicted fiduciary problem continuously arises in the field of ERISA law. Kantor and Kantor works to enforce ERISA laws on behalf of employees/ consumers generally, by holding insurance companies responsible for their fiduciary duties to their insureds.

You can purchase Nudge online and at major booksellers. It has plenty of worthwhile reading!

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California Law Displays Understanding of Eating Disorders
That Insurers Should Emulate

Insurance companies that routinely misunderstand eating disorders should pay attention to California Health and Safety Code Section 1254.5, which provides a refreshing perspective on the nature and treatment of eating disorders. In its findings under Section 1254.5, the California Legislature states, “[T]he disease of eating disorders is not simply medical or psychiatric but involves biological, sociological, psychological, family, medical, and spiritual components. . . . the treatment of eating disorders is multifaceted, and like the treatment of chemical dependency, does not fall neatly into either the traditional medical or psychiatric milieu.”

This legislative comment reflects what we find in our law practice representing clients suffering from eating disorders whose treatment should be covered by their health insurance. We often explain to insurance companies, mediators, and judges how residential treatment for an eating disorder involves intensive treatment of the psychological mindset that perpetuates the eating disorder. Treatment is not limited to the mental aspects; it also involves frequent monitoring of the disorder’s physical symptoms through blood work and weight gain. Education on nutrition and exercise also gives patients the tools to stay in recovery when discharged from treatment facilities.

Combined with Mental Health Parity Acts, such as California’s codified in Insurance Code Section 10144.5, the Section 1254.5 language supports our arguments that treatment for an eating disorder is truly multi-faceted and often residential treatment is the only means for conquering an eating disorder.

Section 1254.5 will not create coverage where it didn’t exist or force an insurance company to pay a claim. But it can increase awareness and recognition in the legal forum when presented to courts and insurance companies.

-- Elizabeth Green

A new study published last week in Science magazine announced that a retrovirus called XMRV may cause Chronic Fatigue Syndrome (CFS). The virus' actual name is xenotropic murine leukemia virus-related virus,and it was found in nearly 98 percent of about 300 patients with the syndrome. See, NY Times, Virus Is Found in Many With Chronic Fatigue Syndrome by Denise Grady.

This discovery provides hope for researchers because if the retrovirus – part of the same family as the HIV virus that causes AIDS – definitively proves to cause chronic fatigue, the disease might be effectively treated with antiretroviral drugs. Currently, no treatment or cure is available for chronic fatigue syndrome. Researchers also believe that they can create a blood test to determine if a patient is infected with XMRV virus, much the same way a blood test can determine HIV.

Chronic fatigue patients are also hopeful that their symptoms – severe fatigue and body aches – will now be taken seriously by doctors and insurers. Because chronic fatigue can only be diagnosed by ruling out other illnesses, some in the medical community refuse to treat chronic fatigue as a legitimate disease or attribute it to a psychiatric disorder. As a result, most health and disability insurers are skeptical about providing benefits for chronic fatigue sufferers who are too ill to work. Many are accused of “malingering,” that is, lying about or exaggerating their symptoms. Now the medical community may have valid research to back up a diagnosis of chronic fatigue.

The study is considered significant for two other reasons: First, the XMRV virus has been linked to prostate cancer. Second, about 4 percent of healthy people studied were carriers of the XMRV virus. According to the Wall Street Journal, that means that “10 million people in the U.S. and hundreds of million people around the world are infected with a virus that is already strongly associated with two diseases.”

The National Cancer Institute has authorized more research to find out if the virus is linked to any other diseases.

Dr. Judy Mikovits, one of the lead authors of the XMRV paper, told the Wall Street Journal, “Just like you cannot have AIDS without HIV, I believe you won’t be able to find a case of chronic-fatigue syndrome without XMRV.”

We have seen it time and time again… insurers downplaying the symptoms of CFS and even accusing our clients of being untruthful about their inability to function normally, all because there was no “objective evidence” of their Chronic Fatigue. Hopefully, this will all change soon as more is learned about XMRV. Has your insurer refused to consider your diagnosis of chronic fatigue seriously? Kantor & Kantor can help.

"Tort Reform, Tort Reform, Tort Reform," the phrase has almost become a song. Nobody likes to see undeserving people win huge, unjustified damage awards, but the fact is, it doesn't really happen in California, except on maybe on TV. Los Angeles Times business columnist Michael Hiltzik couldn’t be more correct when he writes that one of the biggest fans of so-called tort reform is the insurance industry, “because the less money they pay out to plaintiffs, the more they get to keep.” See “Why Tort Reform Is a Frivolous Diversion.”

While that statement is enough to make sensible people wary of the deep pockets behind tort reform movements, Hiltzik clears the confusion and makes a very good case about why limiting an injured victim’s ability to use the legal system to be made whole is not the great fix for rising medical costs insurers and many politicians claim.

The argument for tort reform, as Hiltzik explains, is that plaintiff lawyers are filing too many “frivolous” lawsuits and claiming millions of undeserved dollars. Doctors are ordering unnecessary tests to ensure they don’t misdiagnose or fail to diagnose something that could end up in court. As a result, medical costs escalate.

“The truth is that medical liability isn’t a big driver of health costs overall,” Hiltzik writes. “[T]he cost of malpractice litigation, in court and through defensive medicine, [is] roughly 2% to 3% of all U.S. healthcare spending.”

In California, since 1975, the Medical Injury Compensation Reform Act (MICRA) has capped recovery for pain and suffering to $250,000. That’s next to nothing when to compared to what plaintiffs can receive in other types of cases. Lawyers’ fees are also limited.

But did MICRA help consumers? According to a 2004 Rand study, the MICRA caps don’t amount to a fair distribution of justice. Victims of medical errors who had small economic losses but suffered major damage to their quality of life are unfairly compensated. Women are disproportionately affected. The MICRA cap isn’t adjusted for inflation. In today’s dollars, the award has the same purchasing power as $62,000 did in 1975. And the most unsettling result of all is that may unjustly injured people won’t even pursue a case because the award may not even cover the litigation cost.

The big MICRA winners are insurers, who last year paid out only 17 cents of every dollar they collected on medical malpractice insurance. And carriers don’t even have the good sense to be humble about it.

“At American Physicians Capital,” writes Hiltzik, “claims were falling so fast in 2007 that its chief executive publicly compared his underemployed claims managers to ‘the Maytag repairman.’ The next time you find yourself nodding in assent while some politician carries on about tort reform, remember that its benefits will go to characters like this.”

Clearly, this only reinforces what we’ve been saying all along: If you want real reform, start with the perpetrators, not the victims.

According to Medical News Today, fibromyalgia is no longer an “invisible” syndrome. Citing a study reporter in the Journal of Nuclear Medicine, the article reports that researchers in France were able to detect functional abnormalities in the brain after performing brain scans on 20 women diagnosed with fibromyalgia. Those scans were then compared with scans from 10 healthy women. See “Fibromyalgia Can No Longer Be Called an Invisible Syndrome.”

The diagnosed brain abnormalities directly correlated with the severity of the disease, as reported by the women on questionnaires they filled out in advance of the scan. The results of the study disprove the widely held belief that fibromyalgia is caused by depression. The study found that the brain abnormalities were “independent of anxiety and depression status.”

The study follows news earlier this year that a Stockton, Calif., surgeon patented a process to objectively determine the presence of chronic pain. See, “Surgeon’s Patent Removes the Subjectivity from Chronic Pain.”

Dr. Robert England uses an MRI image to compare the brain image of a person in chronic pain receiving stimulation such as a finger squeeze or mild electric shot to the brain image of a healthy person undergoing the same stimulation.

For people with fibromyalgia, England said his studies showed 13 areas of pain when the patient's thumb was squeezed. When a pain-free person's thumb was squeezed, only one area of pain appeared in the brain.

When these tests will be widely available – and whether insurance health plans will accept them as valid documentation – is still unknown. But they are encouraging developments for people with fibromyalgia who are often accused of fabricating the severity of their illnesses so that the insurer can deny disability or health benefits.

“Most Americans do have insurance and have never had less security and stability than they do right now because they’re subject to the whims of health insurance companies,” President Obama told a group of nurses, speaking from the White House the morning after his Sept. 10 address to a joint session of Congress about his plan to overhaul the nation’s healthcare system. “Obama Keeps Up Health Care Push, Citing Uninsured,” New York Times.

As part of his Wednesday night speech, the president said the legislation he seeks would guarantee insurance to consumers, regardless of pre-existing medical conditions, as well as other protections. “As soon as I sign this bill, it will be against the law for insurance companies to drop your coverage when you get sick or water it down when you need it most," he added. Obama: Time for Bickering Is Over,” Associated Press.

Even though the bulk of the healthcare debate tends to focus on the issue of whether our country could support both private and public health insurance options – we believe it can – the real truth about the way the insurance industry does business cannot be over-emphasized.

The president has it right when he says health insurers must be held accountable. At the very least, any federal health care legislation should mandate that sick people get the coverage they pay for without delays or denials, time-consuming procedures, and claims adjusters forced to be more concerned with limiting benefits than caring for their customers.

Although legislators are showing concern that the debate has become “uncivil,” real progress toward insurance reform necessarily requires a vigorous airing of the issues. We applaud those lawmakers who refuse to bend to the insurance industry’s “whims.”

California Attorney General Jerry Brown announced he will begin scrutinizing how health plans in California pay insurance claims, reports the Los Angeles Times. This move was based in part on a recent analysis published by the California Nurses Association that found six of the state’s largest plans rejected one in five claims during the past seven years - “State to Probe Insurer Denials.”

“These high denial rates suggest a system that is dysfunctional, and the public is entitled to know whether wrongful business practices are involved,” Brown told reporter Lisa Girion.

Brown joins other state regulators, most notably the California Department of Managed Health Care, responsible for policing the health plans. The DMHC, however, reacted defensively to the nursing association’s analysis, claiming it has “been very active in ensuring that providers of care should be paid fairly and on time.”

The insurance industry asserts that the analysis “mischaracterizes” claims data and “does not accurately reflect denials of care for insurers,” even though the numbers the association used to compile its report came directly from the companies own filings with the DMHC.

Although we and many others have frequently accused health plans of improperly denying claims, the Nurses’ Association analysis is the first-of-its-kind report to provide such concrete evidence.

We urge Attorney General Brown to use the powers of his office to conduct more than a cursory examination of this issue, perhaps resulting in something more than the usual slap on the wrist and innocuous fines typically imposed on the industry. Now is the time to institute structural reforms that could revolutionize health care in California, particularly since federal attempts to hold the insurance industry accountable have been compromised by the industry’s unprecedented lobbying. (090904)

According to the California Nurses Association, California HMOs rejected one out of every five claims for medical care between 2002 and June 2009, reports Lisa Girion of the Los Angeles Times. That’s 31.2 million claims, or 21 percent of all claims during that period.

For the first half of this year, Aetna had the lowest denial rate -- 6.5 percent; PacifiCare the highest -- 39.6 percent. Anthem Blue Cross and Kaiser each rejected 28 percent of claims, and Cigna denied 33 percent.

Although such high denial rates aren’t news to us, it’s rewarding to see empirical data that supports our assertions that health insurers tend to delay and deny claims until policyholders are forced to sue them to receive the coverage they pay for. Sure many denials are justified due to actual misunderstandings about coverage, but far too many denials are improper, and even oppressive.

The nurses association used public data from the health plans’ financial reports posted on the California Department of Managed Care’s website to conduct its analysis. “Every claim that is denied represents a real patient enduring pain and suffering,” Deborah Burger, co-president of the California Nurses Association, told the Times.

Typically, the health plans denied the association’s analysis of their reports, stating that “claim rejections reported to regulators do not always reflect actual denials of treatment to patients.” Maybe not always…but often!

DMHC spokeswoman Lynn Randolph told the Times, “It’s important to point out that a denied claim means that the patient received the medically necessary services, but the doctor or hospital was not paid for that care.”

But what’s the difference? Doctors and hospitals are going to bill someone. If the health plan won’t pay claims, policyholders are then forced to pay out of their own pockets. People don’t buy health insurance for the benefit of hospitals and doctors; they purchase coverage so that in the unfortunate event they face catastrophic health challenges, they can get the medical care they need without going bankrupt!

Both the insurance industry and the California Department of Managed Healthcare fail to appreciate the pain and suffering endured by those whose claims are denied. Try being seriously ill, enduring the stress and indignity of life-saving treatment, then finding out your insurer won’t cover your bills. Now that’s real suffering.

For a copy of the California Nurses Association analysis, go to http://www.calnurses.org/media-center/press-releases/2009/september/california-s-real-death-panels-insurers-deny-21-of-claims.html.

No matter which of the half-dozen healthcare overhaul proposals Congress is considering passing, the big winner will be the insurance industry, which is guaranteed millions of new customers, many subsidized by the federal government, reports the Los Angeles Times, “Healthcare Insurers Get Upper Hand,” Aug. 24. What began as a plan to create a public option to compete with insurers, thus driving down the cost of health insurance and the cost of care, has resulted in a windfall for the insurance industry.

But is anyone really surprised at the industry’s success in defeating potential competition?

“In the first half of 2009, the health services and HMO sector spent nearly $35 million lobbying Congress, the White House and federal healthcare offices,” reported writers Tom Hamburger and Kim Geiger, relying on information from the Center for Responsive Politics. In all, that sector employed more than 900 lobbyists.

Health insurance executive Robert Laszewski expressed the industry’s reaction: “Hallelujah!”

Shouldn’t alarm bells be going off all across the country? Is Congress really going to get back to work in the fall and pass “health reform” that has the insurance industry cheering? It is unconscionable that the industry that caused the country’s health crisis in the first place is likely going to be the only one profiting from the solution.

“They have beaten us six ways to Sunday,” Gerald Shea of the AFL-CIO told the Times. “Any time we want to make a small change to provide cost relief, they find a way to make it more profitable.”

If federal health “reform” does become law, we urge stage governments to do what the federal government can’t find the resolve to accomplish: Hold the insurance industry accountable to its millions of present policyholders – and all its potential new customers – to ensure they are getting the coverage they (and their federal subsidies) are paying for.

The Long Island Business News reports that many people think they have enough insurance until they need the policy. Then they learn its limitations, find they have insufficient coverage, or discover “loopholes big enough to drive a truck through.” Laura Glasser, “With Insurance, the Fine Print Matters,” June 30, 2009. This is particularly true, the article reports, for health and long-term care policyholders because they aren’t reading their policies to understand coverage limitations.

“One reason many people get surprises is they don’t know much about their coverage to begin with. If you’ve read your policy lately, you’re in the minority. Most health policies, for instance, cover up to $1 million in lifetime benefits. But most people don’t know that,” writes Glasser. Here’s what two insurance industry executives had to say about the situation:
“The information’s there,” said Ian Laird, director of strategy, sales and programs for Empire Blue Cross Blue Shield. “It’s just in a document that I don’t think the average person bothers to read.”

“You expect people to read their benefits,” said William Golden, chief executive of UnitedHealthcare’s health plan for New York, of the source of many surprises. “I’m not sure that really happens all the time. It’s important to read the small print.”
Here are two insurance executives admitting in black and white that they are selling policies that people don’t read, filled with fine print that limits coverage, and they appear just fine with the situation. In fact, one wonders if they might be taking advantage of this information by filling policies with fine print loopholes that end up surprising many people.

We say it everyday…and we’ll say it again here: READ YOUR POLICY BEFORE YOU NEED IT. If you don’t understand something, ask someone who can help.

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Is anyone surprised by Los Angeles Times reporter Lisa Girion’s article “Insurers Refuse to Limit Policy Cancellations"?

Executives from three of the nations largest insurers were “courteous and matter-of-fact” in their testimony before Congress about carriers’ practice of canceling coverage for sick policyholders known as rescission. When asked it the industry planned to stop the practice, all three executives said, “No.”

Members of the House Subcommittee on Oversight and Investigations must have been dumbfounded by the response, particularly those members who have taken up the industry’s cause in opposing government-sponsored health insurance.

“When insurance companies go under oath and admit they are cancelling innocent patients when they get sick, it makes it very difficult for lawmakers to pass a law that requires every American to buy a policy or face a tax fine,” said Consumer Watchdog advocate Jerry Flanagan. “It opens the way for a public option to hold the companies in check.”

It appears to us the health insurers must not be too worried about the possibility of a public plan or simply confident that they can influence Congress against it the same way they have for the last 30 years.

Will it take a public option to convince insurers to treat policyholders fairly? We wish we could say yes, but in all likelihood rescission practices, as well as denials and delaying tactics, may be so firmly entrenched in the way the industry does business, nothing but a complete overhaul by state and federal regulators – or fines that amount to more than just a slap on the wrist -- would make a difference.

A couple of weeks ago we wrote about United Healthcare’s benefit denial for a young woman who's life is being threatened by her Anorexia.

Sacramento Bee healthcare writer Carrie Peyton Dalhberg reported June 14 about our client and her stuggle (Shepard v. United Healthcare) - “Woman Struggles to Escape Anorexia’s Grip.”

Because of the health plan’s delaying tactics in providing benefits, Ms. Shepard’s family exhausted its financial resources paying for her inpatient care. Our appeal to the California Department of Insurance was successful – United Healthcare was held responsible for Ms. Shepard’s medical expenses. The ruling came a few hours too late, however. Ms. Shepard had been discharged that morning. Ms. Shepard participated in outpatient care after her return, which proved unsuccessful. The article details the tragic result.

Litigation in this case is ongoing. We continue to fight for benefit payments on behalf of people suffering from disabling illnesses and conditions against insurance companies whose delay and deny tactics toward their own policyholders cause hardship and despair.

Los Angeles Times business columnist David Lazarus is about as skeptical as we are about the insurance industry’s pronouncement that it is ready to work with the Obama administration to overhaul the nation’s healthcare system. “Insurers Return to the Table Again,” (May 17, 2009). Lazarus asks the question, “Does anybody trust them?” He couldn’t find anyone who said “yes.”

Lazarus compares this round of the industry’s enthusiasm to “serve the national best interests” to the 1970s when the Carter administration attempted to craft a national healthcare policy. “Nothing came of it,” said Alain Enthoven, who was a Carter consultant. “The whole thing was just a joke.” It happened in the 1990s during the Clinton administration. “They said they wanted to be at the table and wanted to deal,” former Clinton health official Karen Pollitz told Lazarus. “Then they all left. They saw that they could kill it.”

Insurance industry lobby America’s Health Insurance Plans’ Robert Zirkelbach told Lazarus “everything’s different this time.” But no one is buying it.

Here’s the industry’s compromise: If the government forces everyone to buy health insurance, the industry will quit denying sick people coverage and equalize premiums for men and women. And that’s if the Obama administration scuttles its plan for public insurance that would compete with the private sector.

And Lazarus’s point is this: This time, it’s not about what’s “politically feasible and financially palatable.” No, he says, this time it’s about the people who can’t afford health insurance but can’t afford not to have it. That, he concludes, is all of us.

We hope the Obama administration reaches the same conclusion and forces the insurance industry to keep their promises. But we’re still skeptical.