Legal News

Anthem Blue Cross to be grilled about coverage, rate hikes

By Richard Binder

Anthem Blue Cross may be feeling a wee bit up against it this week.

First, there's the trial taking place in Los Angeles Superior Court, where the insurance giant faces charges of refusing to pay for Ephraim Nehme to get a liver transplant in Indiana.  Nehme's lawyers say the refusal stemmed from the company trying to save money, while the company insists Nehme wasn't sick enough to qualify for the exception to his policy's requirement that transplants take place in the state of California.

Nehme originally did go to UCLA Medical Center, where he says he was told by his physician to go instead to the Clarian Transplant Center, which is affiliated with Indiana University in Indianapolis, because wait times were much shorter there.

Most people are barred from suing their health insurer over treatment coverage decisions. Nehme was able to sue because he buys his coverage from Blue Cross with a so-called individual policy. Click here for details.

Meanwhile, today executives for Anthem are scheduled to testify before a state legislative committee about their attempt to raise insurance premiums by up to 39 percent. 

The company has said it needs to increase premiums in part because younger, healthier people have been dropping health insurance coverage during the recession, leaving it with a pool of policyholders that is older and more dependent on health care services.

Steve Poizner, the state insurance commissioner, says Anthem violated state law more than 700 times between 2006 and 2009 by failing to pay medical claims on time and misrepresenting policy provisions to customers. The insurance company could face up to $7 million in fines for these violations.

WellPoint Inc., Anthem's parent company based in Indianapolis, said it would fully cooperate with Poizner to resolve the matter.

Click these for details.

Full post as published by Legal Pad | LA on February 23, 2010 (boomark / email).