There hasn’t been a whole lot that folks have agreed about on healthcare reform, but outlawing health insurance rescission may have been one of the few things that people across the political spectrum could come together about. Left or right, most people do not like the idea that their health insurance can be rescinded, that is that their health insurance can be cancelled once they get sick. Although some states have prohibited health insurance rescission and some health insurers have voluntarily stopped the practice of rescission, healthcare reform banned the practice once and for all last year.
That should have been the end of it, right? Well, not so fast. First of all, the healthcare reform law banned health insurance rescission except in the case of fraud, which would seem to make sense (after all, who wants to encourage health insurance fraud?), but health insurers have seized upon the fraud loophole to continue rescinding health insurance policies. Because health insurers aren’t required to actually prove the fraud, they can continue to rescind health insurance policies with very little risk to themselves, and so rescissions are still going on.
Moreover, healthcare reform only bans the rescission of individual health insurance policies. Healthcare reform does not ban rescission in group heatlh insurance policies, and most group health insurance members rarely think that their health insurance coverage can be suddenly cancelled. However, the case of Heather Galeotti which was reported in The Huffington Postis a great cautionary tale for those who think that their group coverage protects them against rescission. Five months into Galeotti’s treatment after being hit by a car, Kaiser Permanente cancelled Galeotti’s health insurance coverage under her father’s group health insurance plan. The health insurance coverage was only restored after the hospital was forced to submit the bills to Medi-Cal which questioned why Kaiser Permanente refused to pay Galeotti’s $4 million in medical claims.
Have you ever had to fight your health insurance to pay a claim? Tell us about it!
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