Blue Cross cancellations (of personal policies) called illegal

http://www.latimes.com/business/la-fi-health23mar23,0,2604173.story?coll=la-home-headlines

Blue Cross cancellations called illegal

The health insurer 'routinely' dropped the policies of pregnant or ill clients, an agency finds. The company disputes the charge.

By Lisa Girion, Times Staff Writer
March 23, 2007

Blue Cross of California "routinely" violated state law when it canceled individual health insurance coverage after policyholders got pregnant or sick, making no attempt to determine whether they did anything to merit such "harsh" treatment, according to a state investigation of practices that appear to be industrywide.

State regulators plan similar investigations of other health plans in California, and the findings against Blue Cross ratchet up the risk of liability for other insurers, many of whom face lawsuits from consumers who claim they were illegally dumped and subjected to substantial hardships.

As a result of its unprecedented investigation, the Department of Managed Health Care on Thursday said that it had fined Blue Cross $1 million — an amount immediately criticized by canceled policyholders and consumer advocates as too small to matter to an insurer whose parent company, WellPoint Inc., earned $3.1 billion in profit last year on revenue of $57 billion.

Indianapolis-based WellPoint disputed the findings, saying it acted legally and that some rescissions are necessary to combat fraud.

"The vast majority of Blue Cross' rescissions are unquestionably proper under any criteria," WellPoint said.

At issue are individual policies, the type needed by consumers who cannot get group coverage from employers or others. Although insurers cannot deny coverage to members of group plans, state law allows insurers to deny granting individual policies to applicants with preexisting medical conditions.

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There is something morally wrong with a system that is willing to spend so much money to deny sick people access to health care.

to the realm of unaffordability - when we got a little older and one of us was diagnosed with a chronic condition. The insurance companies refuse to take risks and they have to be taken out of the equation.

Four years ago I developed tendinitis in my left arm from training my dog to heel. I was given one cortisone shot in the arm and cured. My dog improved, too, no more pulling. At the next cycle, BC/BS discontinued any coverage of my left arm or shoulder. They said if I sent a letter from my doctor in two years saying I was disease-free they would re-instate my coverage. When I did that, they denied it. So please don't hit me on my left arm.