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Lawmakers Want Insurers To Stop Dropping Sick People

April 28, 2010

Lawmakers are putting pressure on health insurance companies to immediately stop dropping coverage for customers who get sick, even though the companies have six months to comply with new rules that prohibit such activity under President Obama’s healthcare reform act.

The new law, which outlaws the practice known as rescission, gives insurance companies a grace period effectively allowing the practice to continue unpunished until September 23. However, several Democratic legislators contacted several companies, including WellPoint, UnitedHealth, Humana, and Aetna, urging them to immediately cease rescission except in cases of fraud.

According to an April 27 article by Susan Heavey of Reuters, at least one company–WellPoint Inc.–has confirmed that it would stop dropping coverage of ill subscribers on May 1. WellPoint was the focus of an earlier article by the news agency, accusing the insurer of targeting women with breast cancer for investigations so that they could intentionally cancel their policies.

The company admits to using software to find pre-existing conditions but denied singling out breast cancer victims and has called the earlier Reuters report inaccurate, according to Heavey.

“There have been a lot of misrepresentations and inaccuracies in recent days that have caused confusion among our members and among the public generally about our policies in this area,” Angela Braly, the company’s chief executive, said in a statement Tuesday.

In a separate letter sent to Health and Human Services Secretary Kathleen Sebelius, which was also posted on the company’s official website, Braly called the accusations “inaccurate” and said that they “grossly misrepresent WellPoint’s efforts to help prevent, detect, and treat the 1 in 8 of our 34 million members nationwide affected by breast cancer.”

The healthcare reform bill, which was signed into law in March, will provide coverage to over 30 million currently uninsured people and will prohibit insurance companies from rejecting children with pre-existing medical conditions. Furthermore, it will eliminate lifetime coverage caps and will allow anyone under the age of 26 to remain covered by a parent’s insurance plan.

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