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Ohio Bad Faith Insurance Attorneys
Health insurance rescission is the practice by which a health insurance provider cancels a customer policy after it has already been approved. Health insurance companies claim that rescission is an important part of their business model because it allows them to catch customers who lie about their medical history in order to get insurance. However, information has been revealed recently about the dubious ways in which rescission is practiced, particularly by Assurant Health Insurance.
Insurance companies have long engaged in the practice of "rescission," whereby they investigate policyholders shortly after they've been diagnosed with life-threatening illnesses. Like other major health insurance companies, Assurant has a "rescission committee" that reviews recommendations to cancel a policyholder's insurance. In the case of Assurant v. Mitchell, the judge found that the committee rarely does more than "rubber stamp" already-flawed recommendations.
In his order, Judge Michael G. Nettles said Assurant's treatment of the college freshman was typical of how it treats patients recently diagnosed with HIV and other life-threatening diseases.
In addition to these acts toward (Mitchell) there was evidence that Fortis [Assurant] has for some time been making recommendations for rescission, and acting on those recommendations, without good-faith investigation conducted fairly and objectively.
Evidence presented during the case found that Assurant pre-programmed its computer to recognize the billing codes for expensive health conditions like HIV, which triggers an automatic fraud investigation by its "Cost Containment" division whenever such a code is recognized. As was the case with Mitchell, people whose medical conditions trigger this investigation often had their policies canceled on erroneous information, the flimsiest of evidence, or for no good reason at all, according to the court documents and interviews with state and federal investigators.
A federal investigator who has reviewed Assurant's remaining records says that they showed that once a person with HIV was targeted with a fraud investigation, the company made a greater effort than usual to cancel the person's insurance. Policies and medical records were scrutinized to a greater extent than others being scrutinized, he said.
The investigator, who spoke on condition of anonymity, said that the motive for focusing on people with HIV was simply the high cost of treating the illness: "We are talking a lifetime of therapy, a lifetime of care ... a lot of bills. Nowadays someone with HIV can live a normal life for decades. This was about money."
No evidence has emerged that any other major American company purged policyholders simply because they had HIV. Although an investigation last summer by the House Energy and Commerce Committee, as well as 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 saved at least $300 million over five years from rescission. One of those three companies was Assurant.
The lawyers at Dyer, Garofalo, Mann & Schultz L.P.A. want to help victims of Assurant rescission get the justice they deserve. If you think your health insurance policy was canceled unfairly, contact us today at 1-800-223-8897.
Read about Jerome Mitchell's $10 million court award.
Read about Assurant's $37 million lawsuit loss.
