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Largest U.S. Health Insurer Rewarded Employees That Cancelled Coverage of Sick Patients
Date:6/16/2009

Consumer Watchdog Calls on Congress to Ban Bonuses For Canceling, Delaying or Denying Medical Care

WASHINGTON, June 16 /PRNewswire-USNewswire/ -- Consumer Watchdog called on Congress to ban any health insurance employee from receiving bonuses for canceling, delaying, or denying necessary medical care to patients based on new evidence made public today.

The evidence released by the House subcommittee on Oversight and Investigations shows that WellPoint, the nation's largest health insurer, rewarded employees for canceling coverage of sick patients. Employees earned high points on "performance reviews" for retroactively canceling policies -- a practice known as "rescission."

Peggy Raddatz testified at the hearing today about her brother, Otto Raddatz, who died of lymphoma after his health insurer cancelled his coverage. Otto's insurer based the rescission on Otto's failure to disclose an aneurysm and gall stones on his application -- conditions that Otto's doctor had never told him about.

All three insurance executives who testified at the House subcommittee hearing today refused to commit to only cancel policies of patients who lie about their health on their insurance application. This shows that insurance companies will continue to look for inappropriate reasons in the fine print of insurance policies and applications to refuse necessary medical treatment, according to Consumer Watchdog.

"The committee's stunning discovery demonstrates both the need for a real public alternative to for-profit insurers and new legal accountability of insurance companies that are willing to lie, cheat and kill to boost profits," said Jerry Flanagan, Health Care Policy Director for Consumer Watchdog. "When asked by the committee chairman, WellPoint and other executives refused to protect innocent patients by only rescinding policies in cases of fraud. That should send
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SOURCE Consumer Watchdog
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