Blue Cross of California Hates Pregnant Women and Sick People

You get insurance to cover you in case of illness or pregnancy. What does Blue Cross of California do when your condition changes? Cancels your coverage!

Blue Cross of California systematically violates state law when it cancels health insurance policyholders after they get pregnant or sick, making no attempt to determine whether the consumers did anything to merit such harsh treatment, a scathing investigation by state regulators has found.
[snip]
Blue Cross used computer programs and a dedicated department to systematically cancel the policies of pregnant women and the chronically ill regardless of whether they intentionally lied on their applications to cover up pre-existing medical conditions, a standard required by state law for canceling individual policies. Regulators examined 90 randomly selected cases of policy cancellations and found violations in each one.

The state of California is fining the company $1 million as a result. Not that that will help the hundreds of people who lost their coverage.

I’d like to meet the people who worked in the “dedicated department” whose sole purpose was to cheat honest people out of their insurance. I’d ask them if how they slept at night.

In separate news, scientists have found a physical basis in the brain for empathy. Maybe the members of that Blue Cross department would benefit from a little surgery. MARK ASHLEY

Blue Cross fined $1 million for canceling policies [LA Times]
(Photo: net_efekt)

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  1. tedyc03 says:

    This is really dissapointing…I have Blue Cross of California.

    Are there any honest business people anymore?

  2. not_seth_brundle says:

    There was a similar case here in Illinois. The total penalty is $334MM.

    http://www.chicagotribune.com/news/local/illinois/chi-ap-i

  3. Blue Cross hates babies.

  4. Coder4Life says:

    This is about the worst thing I’ve ever read… I hope the CEO is immediately FIRED without compensation.

    Also hope the minds behind the decisions are also FIRED without compensation.

    I live in a family where my brother & dad both have cancer and to think if this would of happened to us in these terrible times what I would of had to go through.

    I really really hope that those people behind the acts lose their health insurance for themselves and their family members and see how that feels.

    Better yet just take everything they are worth to makeup for the family’s trouble and expenses they had to put out themseleves.

    Where has this world gone to?….

  5. CumaeanSibyl says:

    I guess fertility counts as a pre-existing condition now.

  6. ironchef says:

    true story about blue cross…I got turned down for insurance by them after I got laid off when the company I worked for went bankrupt. By law I had to get insurance within 60 days to be considered continuous coverage. I immediately applied after 4 days.

    Blue Cross decided to sit on my application for 64 days despite regular inquires on their applications approval process.

    On the 64th day, they said they elected to deny me coverage.
    They said I was “Morbidly Obese”. Problem about that “diagnosis” is although I do weigh 230lbs, I could bench press 250lbs and leg press 750 lbs. and I was fit enough to run the NYC marathon just months before. Apparently they don’t understand how muscular builds contributes to body mass.

    I threatened to file a complaint with the insurance board about the fact they took 64 days to review my application. The yielded with an expensive HIPAA policy which I was forced to buy just to maintain my continuous coverage.

    Blue Cross are complete a-holes.

  7. HawkWolf says:

    Is BCBS just one company, or is it different in each state? I know it’s this big group, but does the big group have any affect?

    For instance, I’ve heard they’re one of the decent insurers in Michigan. I happen to have them, mostly because my company has no open enrollment that I know of. (I work for a small company.)

    That may be due to them being non-profit here in MI….

    I used to have federal BCBS, which was actually a different company. My family always had problems going to the doctor because the clerk would take one look at BCBS and go, “oh, we don’t take your insurance for this kind of thing.” And we’d have to patiently explain that it was NOT really BCBS, and the person would groan and grudgingly run the actual insurance … thing.

  8. Red_Eye says:

    Insurance fraud in CA is its own industry. When my wife worked for an insurance company there, in trouble for overcharging folks for their homeowners insurance, what did the insurance company do to make sure it didn’t happen again? Why change the customer profiles of course! If the customer mistakenly put down a split level with a basement instead of a ranch, why then it was ok for them to have charged them so much!

    No I’m not kidding they were hired through a temp agency and had quotas for how many profiles they had to change a day! So when it comes to insurance in CA always remember “you’re never in good hands with some insurance companies”.

  9. etinterrapax says:

    Huh. It’s illegal to deny someone insurance coverage based on pregnancy, at least, in New York. It cannot be a pre-existing condition for insurance puposes, and must be covered from the effective date of the insurance. I’m surprised that such a populous state as California doesn’t have better regulations. Not that I expect BCBS would have worked within them, if they’d do something this sleazy anyhow.

  10. segfault, registered cat offender says:

    Insurance companies are evil. I hope those responsible for this and similar problems are fried.

  11. ColdNorth says:

    Blue Cross Blue Shield of Minnesota has a plan called “Simply Blue” which specifically EXCLUDES all maternity labor, delivery and post-delivery care. Strangely, it appears to cover 100% of prenatal care.

    In any event, it is supposed to be geared toward the 20-somethings out there who are usually quite healthy and at a very low risk for chronic disease but typically do not carry any insurance.

    If I am not mistaken, this is also the group that has the most babies.

    Obviously, some spreadsheet jockey in the actuarial department discovered that having babies is just as bad as having cancer… at least as far as the insurer is concerned.

    So, Simply Blue becomes the Rosemary’s Baby of the actuarial and marketing departments of BCBS.

  12. mad_oak says:

    THIS MAKES ME WANT TO THROW UP. Forget intellectual discourse. This crap is always intellectual until it is you. Health insurers cancelling policies after you get sick. Long Term Disability insurers denying elligibility AFTER they help you apply for SSN disability. (You see, the LTD company is only liable to you for the difference between SSN and your LTD coverage. They figure you won’t fight for the extra money, ESPECIALLY since Federal Law prevents you from suing for damages or costs.) Home Insurance policies denying payments, claiming it wasn’t the 200 mph winds that preceeded the storm, it was the flood waters that tore your roof off.

  13. acambras says:

    @CumaeanSibyl:

    Aw, beat me to it!!!

  14. AtomikB says:

    They’re only being fined $1 million? They probably saved a lot more money than that by cancelling so many policies illegally. If breaking the law increases their profitability, why would they ever choose to obey the law? Seriously, a $1 million fine? Why don’t California regulators just give them a trophy?

  15. timmus says:

    This kind of bullshit is exactly why we need universal healthcare. I always hear the whining about Canada’s waitlists for treatment, but most of that is blown out of proportion and it’s not like you can’t travel somewhere and pay out of pocket for a procedure you really want.

  16. revmatty says:

    Having a baby is expensive. Even if everything goes smoothly you’re looking at close to $10,000. Since your annual premiums aren’t even close to that (I hope!) the insurance company sees this as a serious problem. If there are any problems (like our daughter being born premature) it’s pretty easy for it to hit $50,000. I just got our bill for the hospital stay (not including medications, doctor visits, etc) and it is $31,000. Fortunately I have good insurance and will only have to pay a small fraction of it.

    I know a few guys who worked in IT for insurance companies, and the software itself is designed to automatically reject a certain percentage of claims no matter what. The hope is that the insured won’t bother pursuing it thinking it was something not covered, and so the insurance company gets away with not paying what they’re supposed to.

  17. timmus says:

    And thank you to Ben and Mark for covering this issue… I hope we hear as much about these health insurance shenanigans as the Wal-Mart Nazi shirts. It’s the pinnacle of evil behavior when insurance companies start exploiting peoples’ health.

  18. QuirkyRachel says:

    That’s just disgusting. That’s the entire point of health insurance…that it covers you when you need it!

  19. a says:

    This reminds me of the lifetime warranty that I bought, only to realize later it got voided when the product broke. They redefined “lifetime”!
    Thumbs down, BCBS.

  20. phrygian says:

    Ten years ago, when neither my husband nor I was insured through work, we bought Blue Cross/Blue Shield coverage. We were told in no uncertain terms that we would have to notify them 6 months in advance of me getting pregnant, so that they could switch us to a higher priced insurance plan that covered prenatal care and mother wellness. (As if the plan we chose wasn’t expensive enough…) Otherwise, they wouldn’t cover any pregnancy-related expenses. Oh, and the plan didn’t cover birth control prescriptions either. Thankfully, I didn’t get pregnant, but I can’t imagine how many women do and then are forced between choosing to pay out of pocket or use free clinics/services. (This was in Louisiana.)

  21. North of 49 says:

    Timmus: you haven’t had to sit on a wait list in Canada for months to get a treatment which, across the border, would have been done in weeks. Some of the wait lists here are as long as years just to see the specialist!

    And don’t even think about paying to jump the cue. If its found out that’s what you’ve done, the patients won’t get fined, but the hospitals, doctors and clinics will be. One hospital was renting out its CT/MRI for afterhours scans to bring in extra revenue. It was found out and the afterhours scans were stopped immediately. Ms. No49 should have had a cast on her foot to protect the toe she broke, but the doctor in the ER didn’t even splint it or reduce the dislocation. It cost us $50.00 (after subsidy) to see a podiatrist to get it splinted a week after the original break. The podiatrist was not amused at the ER doctor’s treatment of her foot.

    We had to wait 5 months to get DS to the OR for a minor surgery to fix his ears. Something that should have been done 3 years earlier. The 5 months was the wait from when the specialist saw him to the surgery date. It was 3 years from his initial diagnosis from a GP. The rest of the time was just waiting around to get to the specialist!

    Our “universal” coverage isn’t even good coverage. It isn’t even basic coverage. It is “oh shit – I gotta go to the ER” coverage. You show up, you get treated just like everyone else in the line up, but you have to wait your turn. ER wait times for a broken foot – 3 hrs just to get into the “fast track” area. Another 2 to be treated. We’ve had waits as long as 12 hrs if not longer for some injuries and conditions. People have died waiting for a doctor in the ER!

  22. acambras says:

    @North of 49:

    Is the plan admistered at the provincial level? I’m wondering if wait times, etc. vary depending on what province you’re in (not that I’m suggesting you move, mind you).

    It’s just that I’ve heard such widely varying stories about the Canadian system (from Canadians and from American politicians who are either for or against implementing a similar system here).

    I doubt the Canadian system is perfect, but I KNOW that the American system is broken.

  23. IC18 says:

    BCBS, Blood Consuming Bastards. I guess thats what their name implies. Its stories like this that make me disgusted from insurance companies. I just got married and now I am double chack things with my insurance company before having a baby. Does anyone know if UnitedHealth deal the same way?

  24. pestie says:

    @CumaeanSibyl: Yes, and pregnancy is a sexually-transmitted disease.

  25. valet_of_the_dolls says:

    @acambras: Yes, acambras, each province has its own healthcare system, some better (less stretched, maybe) than others.

    I have heard similar stories to those North of 49 tells, but I’ve also heard just as many about prompt attention and excellent care.

    I have a couple of friends who are living and working in the U.S. right now, and though they both make good money, their greatest fear is an accident or lengthy illness. Canada’s healthcare system isn’t perfect, no, but it’s not broken either.

  26. spanky says:

    @IC18:
    What BCBS is doing really isn’t unique to them, although I don’t know how others compare. The rule of thumb is that individual health insurance is risky. Group plans are relatively safe.

    The reason these cases are coming to light has to do in part with the fact that California has a state law that prohibits this type of retroactive policy cancellation for anything but intentional misrepresentations; and they were flouting that pretty blatantly. An attorney there had a bunch of clients with similar cases against BCBS, so he filed a whole buttload of individual suits against BCBS on the same day to draw attention to the problem, so regulators had to pretend to address the problem. (And a million dollar fine is pretty clearly pretending, when 100% of randomly selected cancellations were hinky.)

  27. wezelboy says:

    And Blue Cross costs a freakin’ fortune.

    Part of me wants to just put that money in a savings account for when we really need it.

    The only benefit you really get is the discount that Blue Cross forces on the provider- which is why so many doctors are being forced into early retirement.

  28. mac-phisto says:

    @AtomikB: this is exactly what i’ve been trying to impress on people. a corporation’s only real responsibility is to make money. if they can consciously break the law & still make money doing it (even if they are caught), they do it.

    the fines need to go up, they need to be in addition to a penalty equal to the money gained by breaking the law & there need to be criminal charges brought against those responsible (since sarbane-oxley, that means anyone who signs off on a financial ledger). start throwing the crooks in jail & bankrupt the company if they can’t follow the law.

  29. Nemesis_Enforcer says:

    @etinterrapax:
    It is illigal to consider pregnancy as a pre-existing condition here in Ca. I used to work for a Health Ins co. here in LA as a CSR. I quit when it became obvious they didnt want us to help people get thier problems fixed, they only cared about getting the caller off the phone and you to the next call. It was a soul sucking experiance and one I will never repeat.

  30. Nemesis_Enforcer says:

    illegal…d’oh

  31. Canadian Impostor says:

    “I live in a family where my brother & dad both have cancer and to think if this would of happened to us in these terrible times what I would of had to go through.” – Jaideepg

    My stepdad’s insurance company claimed that his first night (and subsequent nights) spent in the hospital wasn’t necessary.

    He had emergency brain surgery to remove an aggressive tumor. Apparently you can have that procedure done and walk home afterwards now.

  32. bearymore says:

    @revmatty: That is what insurance is for and why insurance companies have actuaries. It is supposed to spread risk. So you have a $30,000 birth one year while a multitude of other subscribers use well less than their premiums in medical services. The next years you use less than your premiums. So what. Actuaries figure the risk and set the rates so that the companies make a profit. They must be doing their job since BC of California’s mother company made a piddling $3.7 billion last year.

    By the way, I have a high deductible individual BC of California plan that has a premium of well over $1,000 a month. Get real.

  33. lakai says:

    This totally makes sense!!! My girlfriend and I recently had a baby back in January. We are not married so my insurance could not cover her, so she ended up being insured by Blue-Cross Medi-cal. All was fine and everything was to be covered. ( Prenatal, Labor ). 2 Months after the birth of my son, I/She gets a bill from blue-cross for the labor, tests, and every pre-natal visit she had. I have been back and forth with them since even before the labor. I was told by the accounting rep from her obstatrician that blue-cross does this all the time, and that we probably have to go back and forth about this, but they will eventually pay.

  34. Melsky says:

    I’m an American living in Canada for the past three years and I’ve had really good experieinces with the health care system here. I have a doctor I like, I had to wait one week for a non-emergency proceedure, if I get sick I can go to a walk-in clinic and get seen pretty fast. My husband had a heatstroke last year but they thought it was a heart attack at first. He was seen quickly in an emergency room. Contrast that to when my grandfather had a heart attack in the US and they could barely physically get him into the emergency room because it was cold and flu season and the emergency room was filled up with non-emergency cases who didn’t have health insurance. (It’s illegal to refuse care to people in emergency rooms.)

    To all the people saying they hope that someone at blue cross gets fired for this – yeah right! Whoever was responsible will probably get a promotion. It’s all about making money, and they have enough of it to keep buying politicians.

    I had horrible problems with our US insurance after my husband lost his job. Having your insurance through your job, what a great idea! Then you lose your job, have less money and have to pay the full amount. And if you try to get private insurance, they just cancel it when you start needing it.

    Canada is not perfect and I know people have horror stories, but there are plenty of horror stories in the US too, and I will take Canada’s system any day.

  35. yorfutrxhsbnd says:

    With Blue Cross of California, as with all insurance companies, it’s all about the bottom line. At the patient’s expense.

    State Senator, Sheila Kuehl has a single -payor health plan. Her bill, SB 840 was passed by both houses of the California legislature and then vetoed by the Governor. The bill has been reintroduced this year and would provide coverage for all Californians. This bill is different than the “Universal Coverage” which the Governor has proposed in that it is single-payor like the medicare system. Before you think “just what we need, another government beurocracy”, remember this: The typical insurance company has overhead expenses of 30-40 percent. The overhead of Medicare? 3-5 percent. Do the math and you will see that single-payor is the way to go.

    Please learn about this bill at Onecarenow.org. Tell your friends. Call the governor. We think that if enough pressure is put on the governor, a real grassroots effort, there is a good chance that he will sign the bill.

    This bill would set a trend for the entire country and is the only way to rescue health care in this country.

    JB

  36. canuckistan says:

    Yeah, once again, different story, same comment:

    Way to go America, glad to see you exemplifying the absolute worst traits of humanity! Hurray!

    Too bad cancerous babies aren’t filled with crude oil , then they’d be operated on immediately!

  37. ChefGirl says:

    I’m a victim of Blue Cross. I had brain surgery and they *hated* that. Cancelled my policy pretty much after my surgery – leaving me with no follow up care. As if the disease I had wasn’t enough – Blue Cross made sure to devastate the rest of my life and continues to do so – to the tune well beyond $150,000 in debt when they refused to pay the bills. My friends created a website to let people know what happened. http://www.SaveMyFriend.com – thank you to my friends. Blue Cross should be fined far more than 1 mil and they should be made to pay these claims. It’s just wrong in more words than I could possibly say. I’ll be living this forever – along with the brain damage I sustained with no follow up care. Thank you – Blue Cross – thank you. I hope my $150 a month was worth it to you. That’s what my life was worth to you. My little girl thanks you, too.

  38. Reginleif says:

    Yes, ghod forbid that BCBS offer a special insurance plan to people who don’t want to have kids, like me. Sorry, but I’m tired of hearing about how it’s ALL about “the children” and “the babies” and “the pregnant women.”

    Know what? Childfree people deserve coverage, too. And we already pay proportionately higher rates than so-called “families” (as if people who haven’t reproduced don’t “properly” belong to a family). It’s not all about you and your precious kids.

  39. sophie88 says:

    I have found that most insurance companies will not take you even if you
    have a condition which doesn’t require an expensive treatment or lower your
    life expectancy. I had a relatively minor health condition, but was rejected
    for any private insurance by BC and another company. The state I live in
    has a type of policy for people who are ill “and can afford” this insurance.
    It costs a lot, because it amounts to joining what is called in auto insurance
    a “risk pool”. I had a deductible of 1,000 dollars and then 80 percent of
    expenses were covered. Every year I had that insurance, I got a benefit
    around in October and no more than a couple hundred dollars of expenses were
    covered. I did receive the benefit of the “insurance” discount.(The doctor’s
    couldn’t charge me the higher fee they would have charged a person without
    insurance.) I am lucky my state has this type of program, because not all
    of them do and without it I would have been- stating this politely- uninsurable.

    Who are the doctor’s caring for the uninsured that the AMA is talking
    about on the TV? The offices I’ve been to won’t even take an HMO. Are they
    doctor’s who work in emergency rooms? I would like a list of names.

    I recently “saw” (technically, although I don’t think I was visible to
    this guy as he did not examine me and sat behind a computer) a doctor who
    said he couldn’t mail my blood test results to me because “that gets expensive”.
    I’d be happy to give him the four bucks. The only reason I asked was because
    my last (nice-but now retired) doctor missed a thyroid problem on my last
    blood test. He sent the results and I brought them to my next appointment
    and asked HIM about them.

    I wish I could find another doctor who was willing to answer questions
    because I often feel like I’m the one primarily responsible for figuring
    out my own health issues. Honestly, I don’t mind doing that if the doctor
    is open and honest with me. Ideally, they would also do a physical exam and
    ask me if I had any questions. This last guy was talking on his cell phone
    about his malpractice premium and telling me about how he was “building his
    practice” instead. Boy, was I impressed!!!

    I often think that due to my medical condition I would have more money
    and be happier with my medical care if I lived in another industrialized
    nation, and I find that very, very sad.