Another Example of Insurance Companies Screwing Us – Healthcare Must Change – Plus My Rant: We Must Help Each Other – A Look at the French


America, we need to wake up and protest this kind of shit. We need to stick together and stick up for EACH OTHER. It’s the only way we can change the current system.

Changes won’t happen if we only care about ourselves and only say something when we’re personally wronged.

Imagine a system in which, if you were wronged people would rush to your aid, whatever that might be, and if others were wronged you would rush to their aid? Sounds like a fairy tale, but it is possible. Indeed it’s happening in some places.

In America the media makes fun of the French people and their system, which of course is not perfect, just like every other system. Did you ever wonder why it is that these fat cat corporate types, politicians, lobbyists and media companies, which are owned and controlled by rich people who benefit from the current system, spend so much time bashing the French? Why they want you to look down on them? Because they’re scared that if you open your eyes and think for yourself that you’ll see that the French actually have it pretty good… and if you see that then you’ll want to make changes to the American system to make it more like the French system (in some ways)… and if that happens it will cost them money and power… and they like their money and power… they want to keep it… they don’t want you to have any of it…. just shut-up and keep beavering away at your shitty little job… here’s a $300 tax rebate… boo, the terrorists are going to get you! Be scared! Consume! That’s why.

Do you know that the French economy is more productive than the U.S. economy even though it has higher unemployment, everybody has healthcare, they only have a 35-hour work week, and they get many, many weeks of vacation per year? And they eat and drink lots of great food and drink! How can they have all this? Because they stick together. When the fat cats try to take from one group, the others strike and protest. It works. I mean there’s more to it than that, but the point is that they stick together and they stick up for each other. They are all about “we.” It seems most of us Americans are all about “me.” That’s the crux of the biscuit.

Pay attention and think for yourself. Most importantly, stick up for other people, especially those who don’t have what you have. That is the system we should work towards. We can do it by expanding the circle one person at a time. Get out there and stick up for someone. Now repeat. Make it your life! Cheers.

Now on to the article, which is just a microcosm of what’s going on in the entire corrupt and perversely incentivized system.

State accuses Blue Shield of illegal cancellations
By Lisa Girion
Los Angeles Times Staff Writer

December 13, 2007

California’s top insurance regulator has accused Blue Shield, one of the state’s largest health plans, of 1,262 violations of claims-handling laws and regulations that resulted in more than 200 people losing their medical coverage.

Calling the allegations “serious violations that completely undermine the public’s trust in our healthcare delivery system and are potentially devastating to patients,” Insurance Commissioner Steve Poizner said he would announce today that he would seek a $12.6-million fine.

Blue Shield called the charges “grossly unfair” and vowed to vigorously contest them and the proposed fine.

In a statement issued to The Times on Wednesday, Duncan Ross, president of Blue Shield of California Life & Health Insurance Co., said “we are outraged by the excessive penalties for nonsubstantive issues,” and called the actions “a radical departure from the [Department of Insurance’s] widely accepted and long-standing interpretation of the law.”

“The department’s position penalizes practices that have previously been approved by the department and have been followed for years by all health insurers,” Ross said.

The company has long maintained that its cancellation practices follow the law and are an important guard against insurance fraud. In any event, the company has said, only a small portion of its policies are affected.

The enforcement action is based on an investigation of Blue Shield of California Life & Health, which covers about 167,000 people in individual and group policies licensed by the Department of Insurance.

The action does not include another Blue Shield unit that has about 2.3 million members in health maintenance organizations overseen by the Department of Managed Health Care. The state’s HMO regulator is conducting a separate investigation of the company’s cancellation practices that is expected to be completed early next year.

Wednesday’s enforcement action was the toughest yet by state insurance and HMO regulators who have been critical of the way health plans cancel individual policies after receiving claims for costly medical care.

The department’s action against Blue Shield is the latest example of regulators closing ranks on the cancellation issue. Both agencies are seeking regulations aimed at curtailing cancellations, also known as rescissions. And both are investigating the way these are handled at the state’s biggest health plans.

In March, the first of those investigations came to fruition when the Department of Managed Health Care hit Blue Cross, the state’s largest for-profit insurer and a Blue Shield competitor, with a $1-million fine after reviewing 90 cancellations and finding alleged law violations in every instance.

The move against Blue Shield marks the first time the Department of Insurance has taken legal action against an insurer over its cancellation practices. But it may not be the last.

Poizner said Wednesday that he had directed his agency “to target this type of forbidden behavior on an industrywide basis and we will continue to take appropriate action as needed.”

Half the violations alleged by the Department of Insurance relate to Blue Shield’s cancellation practices. Other allegations related to claims handling. In those, the department said that Blue Shield, a nonprofit company based in San Francisco, failed to pay interest owed on claims, mishandled member appeals and dragged its feet on paying claims.

At the department’s urging, Blue Shield conducted its own review of some of the claims-handling problems identified during the period examined — June 1, 2004, to May 31, 2005. That review looked back three more years and resulted in additional payments for members’ medical care of more than $1 million. Blue Shield also changed some claims-handling procedures and retrained staff.

The problems the state found in the way Blue Shield issued individual coverage resulted in 229 alleged improper cancellations involving hundreds of treatment claims.

Blue Shield rescinds policies based on what it considers misstatements on applications discovered after costly medical claims are submitted.

The Insurance Department alleged that Blue Shield erred in failing to properly vet applications before issuing the policies in the first place.

Blue Shield has said that in most cases it accepts applications at face value because medical underwriting — the process of comparing the information submitted with available medical records — is time-consuming and costly.

The department also cited Blue Shield for routinely failing to attach the applications for coverage to the policies when they are issued. The company has since changed that practice and now attaches the applications to policies. But it maintained that its old practice complied with the law.

In his statement, Blue Shield’s Ross said the Insurance Department was unfairly trying to change the rules in the middle of the game: “The department proposes new legal standards for underwriting and rescission that conflict with decades of court decisions.”

“For many years, Blue Shield Life has filed its application forms and insurance policies with the department, which approved them,” he said. “Those documents clearly set forth the requirement that people who apply for insurance must submit accurate and complete responses regarding their medical history, as well as the consequences for not doing so.”

“Now the department has determined that the documents do not meet their new standard — and wants to apply that judgment retroactively,” Ross said.

What’s more, the department is just plain wrong in its interpretation of the law, Ross said.

“For many years, the courts, including the California Supreme Court, have clearly stated that an insurer need not demonstrate that an applicant intended to deceive the insurer in order to rescind a contract, as long as the misrepresentation was of such significance that the policy would not have been issued,” he said.

Blue Shield also said that the department’s position on attaching applications to policies was on “shaky legal ground” and relied on a technicality.

The Blue Shield investigation began under former Insurance Commissioner John Garamendi, a Democrat who is now lieutenant governor. It was completed under Poizner, a Republican and Silicon Valley entrepreneur who put millions of his own money into his campaign for insurance commissioner and refused to accept donations from insurers.

“My message to all health insurers in California is that I will not tolerate inappropriate rescissions and shoddy claims handling,” Poizner said Wednesday.


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