Evidence is beginning to suggest that some insurance companies are utilizing the confusion over Obamacare to their advantage by tricking customers into purchasing policies which are much more expensive than they can get by shopping on the exchanges.
Two of these cases have been uncovered by reporters at Talking Points Memo — and if they are an indication of what other companies are doing, it is at best an unethical practice and at worst an intentional attempt to undermine the law in the eyes of the public.
In one case in Seattle, a Washington woman named Donna received a letter from her insurer, Life Wise, a subsidiary of Blue Cross/Blue Shield telling her that her policy is being cancelled and that if she did nothing, they would automatically enroll her in a new plan which would cost her $300 a month more than her current plan.
The company made no effort to offer her the option of shopping for new coverage on the state exchange because, as a spokesman for the company said, “the Washington marketplace had done plenty of its own advertising and the company assumes that customers know they have other options.”
Fortunately for Donna she did know of the option and she found a plan there which met her needs for more than $1,000 a month less than the policy which Life Wise had offered.
The other case found by TPM was one in Kentucky where the state fined Humana $65,430 for “misleading intentionally” its customers, prodding them to either renew their policies immediately or opt for new much more expensive plans, only mentioning the health care exchanges in a footnote to the letter.
Humana also told them that they could get a cheaper premium if they agreed to amendments to their policies which had not been approved by the state insurance department.
The investigation is ongoing to determine whether or not the company intentionally misled their customers. The insurance department has fined them and says that approximately 2,200 people did return the signed amendments to their policies.
“The Department of Insurance fined Humana for providing members with a policy amendment form that was not approved. This was a clear-cut violation of Kentucky’s insurance code,” insurance department commissioner Sharon Clark said. “The Department has other concerns with the letter and with Humana’s actions. We have met with Humana and continue our investigation. We will take additional administrative action, if appropriate,” adding that she felt that the letter was intentionally misleading.”
Kate Marx, a spokesperson for Humana said the company “is working in concert with the state Department of Insurance. Humana does not plan to appeal the decision.”
Regulators say that Humana has said that they will send another letter to those who received the first one which will clarify.
Another company, Anthem Blue Cross Blue Shield was also investigated for a letter urging people to “call now” to lock in “today’s affordable rates.” It was determined however that this letter targeted people who buy their insurance on the open market and who would soon be able to use the exchange to purchase a policy. A spokesman for the insurance department said for that reason it was not in violation of the rules, unlike the Humana letter which went only to current policy holders.
Since these are major insurance providers operating nationwide it is not hard to imagine that the same sort of shenanigans are occurring elsewhere i the country, only time will tell.
H/t: Huffington Post