Denial of coverage leads to big profits for insurers

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By Pat Justis | For The Olympian • Published May 14, 2008

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Blue Cross of California also was investigated after lawsuits claimed the company had a special department set up to systematically look for any excuse to refuse coverage for large claims. Investigation revealed that Blue Cross has personnel assigned to uncover potential misinformation on applications. Blue Cross sits on discovered problems and continues to collect premiums unless the enrollee makes a large claim. When the enrollees' claims exceed the collected premiums, Blue Cross cancels or rescinds the policy.

The California Department of Managed Care imposed a $1 million dollar fine after investigations revealed systemic problems in the way Blue Cross/Blue Shield rescinds coverage.

Even with coverage, family finances might still crumble when illness or injury strike. About half of all personal bankruptcy cases are because of health costs. Every 30 seconds, a U.S. resident files for bankruptcy related to health care expenses and more than three in four have health insurance.

Americans believe every citizen has the right to fire and police protection and public education. Now we must say every citizen has the right to affordable health care.

To bring health care costs down, health insurance must be brought under strict regulation. Other countries with multiple insurance companies have intervened successfully. Let's outlaw limitations based on pre-existing conditions. Insurers should not be able to rescind coverage after a claim, collect outrageous premiums or deny coverage to those who need it most. We can no longer tolerate the way health insurance companies abuse the families of our community.

Pat Justis worked in health care for 23 years before becoming a freelance writer, photographer and consultant. A member of The Olympian's Board of Contributors, she can be reached at pat@patjustis.com.