by Brigette Courtot, Policy Analyst,
National Women's Law Center
This post is part of a series on Women and Health Reform.
It came via certified mail, which was enough to make her nervous, but a quick glance at the return address actually made her stomach drop. A certified letter from a health insurance company—could that ever mean good news? For my close friend Margaret it most definitely did not. Her health insurance company—one of the largest in her state and in the country—had begun digging into her medical history to scrutinize her original health insurance application. Nine months had passed since she was approved and enrolled in the health plan, but now the company had some concerns. Enter the “Dear Health Plan Enrollee” letter.
When Margaret called me two weeks ago, letter in hand, she was confused and a little angry, but she was mostly just terrified. Was the company allowed to do this? Why were they doing it now? Would she lose the health insurance that she so desperately needed?
Margaret’s predicament is upsetting, but it’s hardly surprising. Here at NWLC, we’re no strangers to the often questionable practices of private insurers, especially among companies in the individual health insurance market where Margaret bought her coverage. Individual market insurers are allowed to do a lot of things to keep sick people off their rolls (it’s all about their bottom line, after all). And Margaret is sick. This past winter, she was diagnosed with leukemia. She began treatment immediately with a relatively new and expensive cancer drug. The treatment has been very effective, but it seems that once her insurer realized they’d need to pay for it, they began looking for a way to avoid it.
In policy-speak, Margaret has become the target of a common industry practice called post-claims underwriting. A Families USA report defines the practice this way:
Unfortunately, most states allow (tacitly—if not explicitly) insurance companies to perform medical underwriting, or to conduct more stringent underwriting, long after a policy has been issued to a consumer…When individuals need costly medical treatment long after purchasing their policies, insurance companies dig further into their medical histories and retroactively limit or revoke coverage.