Insurance Recission: What You Need to Know.

A terrible crime is being committed against the American public: recission. This is when a private insurance company revokes your policy because of some technicality (whether real or fabricated). And what do you know, this tends to happen right after you’ve been diagnosed with a major illness!

Thake the case of Jerome Mitchell, 17 year old college student who found out he tested HIV positive when he donated blood. Here’s what happened:

Before the cancellation of the policy, an underwriter working for Fortis wrote to a committee considering whether or not to rescind his policy: “Technically, we do not have the results of the HIV tests. This is the only entry in the medical records regarding HIV status. Is it sufficient?” The underwriter’s concerns were ignored and the rescission went forward.

In the ruling, Chief Justice Jean Hoefer Toal wrote: “We find ample support in the record that Fortis’ conduct was reprehensible … Fortis demonstrated an indifference to Mitchell’s life and a reckless disregard to his health and safety.” (from article on Huffington Post, link below)

And then there’s Patsy Bates, a grandmother and salon owner, who had her policy cancelled while she was undergoing chemotherapy. It was several months before she was able to resume treatment. Wonder what happened to her cancer during that time?

An investigation this summer by the House Energy and Commerce Committee, and earlier ones by state regulators in California, New York and Connecticut, found that thousands of vulnerable and seriously ill policyholders have had their coverage canceled by many of the nation’s largest insurance companies without any legal basis. The congressional committee found that three insurance companies alone made at least $300 million over five years from rescission. (ibid, emphasis mine)

….evidence emerged that Health Net had paid bonuses to employees to reward them based on the number of policyholders they had rescinded. The judge who awarded Bates the $9 million said in his decision: “It’s difficult to imagine a policy more reprehensible than tying bonuses to encourage the rescission of health insurance that keeps the public well and alive.”

Why would anyone have such blatant disregard for human life? Because their mission is profit, that’s why. And that’s what the insurance business is about anymore — it’s not about providing insurance, it’s about making money. What is a private company’s motivation to actually provide the benefits you’ve been paying for?

I don’t begrudge any hardworking capitalist his due, but there are some things where the profit-model is inappropriate. No one should benefit from the sickness and death of others. And while our Government has its share of corruption, at least it is beholden to the voters, not its shareholders. If we as citizens have the good sense to wake up and hold our government accountable, then maybe we have a chance at an honorable health care system. One thing’s for sure: it will never happen under private insurance.

Read more at: http://www.huffingtonpost.com/2009/09/17/insurance-company-must-pa_n_289841.html

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Profile Photo Amanda Blount

I have always thought that insurances should be non-profit entities. That way, if they lose money, it will not affect them as if they were a regular company. Being NON profit does not mean they are a charity, or that they can’t deliver a great service. There are a number of companies, and medical facilities who are Non-profit and the CEOs and employees still get a very nice check, but the profits go back to benefit the consumers, not to the share holders.

Anyone know of a Non-profit model insurance company? I don’t think I have ever heard of one.

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Profile Photo Henry Brown

Would offer that the Health Care CO-OP would fulfill the description of a non-profit insurance company

This article from CNN (one of 7 million hits from google) discusses a rather large CO-OP in MN. another rather large AND “effective” one is the Group Health Cooperative in Seattle WA.

INVER GROVE HEIGHTS, Minnesota (CNN) — We’ve heard a lot of talk lately about health “co-ops” — but what exactly is a “co-op,” anyway?
The co-op model is being mentioned as one possible alternative in the current health care debate.

The co-op model is being mentioned as one possible alternative in the current health care debate.

It’s short for health insurance “cooperative,” and it’s a phrase Americans are getting accustomed to hearing these days as lawmakers point to the co-op model as one possibility in the debate over health care reform.

Headquartered in the suburbs of Minneapolis, Minnesota, HealthPartners is one of the nation’s largest co-ops. CEO Mary Brainerd says that, in the simplest of terms, a health insurance cooperative is “an organization that is governed by its members, is not for profit, and is focused on solving health care issues for its members.”

At its heart, a co-op is a non-profit, member-run system for providing insurance plans. However, HealthPartners has taken that to another level by also providing care itself. And although it started out as an insurance system when it began more than half a century ago, HealthPartners now accepts policies of other insurance companies as well. Video Watch how a co-op works »

HealthPartners currently has a network of 70 facilities in Minnesota and Wisconsin and serves more than a million members.

HealthPartners’ clinic in Inver Grove Heights looks like your average medical center — it comes complete with a dental facility, its own blood lab, and a pharmacy. In other words, it’s tough, if not impossible, to tell that it’s a co-op simply by looking at it.

Norman Nistler of South St. Paul has been a member for about 25 years, and even he didn’t realize it was unique.

“On television now there’s a lot of talking about co-ops, but I didn’t realize this was a co-op,” Nistler says, adding that, nonetheless, he’s been satisfied with the care he’s received.

Darla Andrews, on the other hand, says she knew she was part of a co-op and is part of the HealthPartners insurance plan. She says that, after being a member for 30 years now, she wouldn’t have it any other way.
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“I like the small community feel of here. It’s more personal attention,” Andrews says after a stop at the pharmacy. She says she also appreciates another of HealthPartners’ self-touted trademarks — electronic medical records. HealthPartners was a pioneer in digital records, having used them regularly since about 2004. Plus, its administrative costs are half those of the average private insurer.

The company is run entirely by a board of directors that is elected by HealthPartners members. CEO Brainered says it’s primarily because the company is not beholden to shareholders that it is able to keep costs down.

“That means that their primary allegiance and accountability is to that membership base and customer base,” Brainerd adds. “Making sure health care is affordable is a very big deal to a co-op. Having low administrative costs — there’s no value to our membership in having high administrative fees, so a big focus is on putting the dollars into health care and not into administration.”

HealthPartners has also saved millions of dollars by switching to generic drugs.

Brainerd says another hallmark of this model is a “longer-term focus,” which has given HealthPartners the ability to put more emphasis on preventative medicine.

“We’re very focused on quality [because] that’s where my family and I, if I’m a member, are getting our health care.”

As part of this focus on the long term, HealthPartners’ doctors have encouraged their customers to quit smoking — and this has helped cut tobacco use among members by double the Minnesota state average.

But surely there must be downsides — or everyone would be doing this by now, right? Brainerd says she thinks it’s because not all states are ripe for this kind of system just yet.
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“The environment hasn’t been very supportive of co-ops. It’s been a much hotter deal to be a publicly traded, for-profit health plan,” Brainerd says. “That’s where all the action is.”

The current debate about health care reform could change that, though, and mean a bigger future for co-ops

© 2009 Cable News Network

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Profile Photo Sam Allgood

Co-ops seem like a pretty good alternative to insurance companies. I am aware of at least one other whose target participants are Christian ministers and missionaries.

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Profile Photo GeekChick

I think it sounds good too!

Even if we stayed with private companies, why not have some laws like other countries that prohibit profits for insurance providers? That model seems to work too. It removes the motive for things like recission.

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