Avoiding Future Hassles When Getting Group Health Insurance


Yesterday I shared some thoughts about adding dependents to Medicare plans.  It cannot be done.

Today I want to share an email I received last week.  It was from someone who added his wife and children to his group plan.  I also want to share my answer.

The conclusion is that if you want to avoid paper-work problems in the future, sign up for group health insurance as soon as you eligible.  If you wait to add dependents until later, they are subject to medical underwriting and pre-existing condition limitations.  If someone is diagnosed with a serious medical condition in the next few months, your insurance company is going to investigate to see if you waited until the last-minute to enroll them in health insurance.  If you did, you eliminated the element of “chance” from insurance and are guilty of attempted insurance fraud.

Not all problems with health insurance is the insurance company’s fault.  Often the problems can be avoided.

COMPLAINT

Please help! I am a pilot with XXX and have family coverage for myself, my wife, and our two children through XXX Corporation and automatic payroll deduction since August 17, 2011. My wife and I found that her coverage had been terminated for a second time in one year after the breast clinic she was scheduled to go called to request another form of insurance.

When I called ABC INSURANCE COMPANY to ask why she had been cancelled, no one can answer definitively. I am being told that it may be caused by case numbers not matching up on my wife’s files? Well, whose fault is that? Certainly not ours!

We are then told that it may take 3-5 business days before she is covered again and that we should just wait it out. I request to speak to a supervisor and am told that one will call me back at a later time, usually within 2-3 business days. In the meantime, my wife waits to reschedule the follow-up cancer screening for the lump that was found in her left breast a year ago?!?!?!

This is impossible to believe that this is legally happening to my family…..please help me and advise if my wife and I have any legal recourse. Can we prevent this from continuing to happen AGAIN?

RESPONSE

I have worked with ABC INSURANCE COMPANY for several years.  While I have never seen them do anything illegal, they are not the most lenient insurance company with anything that is questionable. Of all the Major Medical insurance companies that I deal with, they have one of the highest “Complaint Index” with the State of Texas. It is 7.4226. The average complaint index is set at 1. This tells me that  although they are good insurance, they are not the easiest with which to work.  They have 7 times the number of complaints as the average health insurance company.

Based on the time-table you gave me, here is what I think is the problem.  I could very well be mistaken.

I do not know all the details of your case. I am hesitant to behave like a politician and tell you something that you want to hear but not take the time to know all the facts.  As an insurance agent, I try not to give my clients the politically correct answer they want to hear.  I prefer to tell them the truth as I see it.

Without knowing all the details, it sounds like they may be investigating to see if there is a violation of the pre-existing condition clause. If you just added her to your group policy in August and she was diagnosed with cancer less than 18 months later, they have the right to make certain that she was not previously  diagnosed with cancer. If there was no symptoms before she was added to your policy that would cause a “prudent intelligent person to seek medical help,” it should be only a matter of sending them their form.

If everything is on the up-and-up, which I have no reason to think otherwise, ABC INSURANCE COMPANY will pay for her medical expenses. They just need proof that she did not wait until she was already sick to get health insurance.

You are right. Here in TX it is illegal for an insurance company to cancel a health insurance policy just because someone gets sick. However, they are allowed under both state and federal law to rescind coverage if they are able to prove that it was obtained fraudulently. Although I know that it is not what you want to hear, every insurance company has the right to investigate “questionable” diagnosis within the pre-existing condition clause time period.

There is another possibility.  There is a very good chance that it could just be a coding problem at your wife’s clinic.  It is easier for some people to blame others than it is for them to say, “I screwed up but will correct it.” I have seen that happen too often. If that is the case, all that is required is that the clinic resubmit her claim.

Unfortunately, you may never know who caused the problem.  The problem is similar to what the presidential election is.   Who is to blame for the problem does not matter.  The important thing is that the problem gets solved.

Fortunately, your problem is easier to find an answer to than the national economy.  However, before you start working on your insurance problem please keep in mind that health insurance is not the same as “Health Care.” Insurance companies are merely bill paying services.   Her health is more important.  Your wife’s health care is given by doctors and hospitals.

Assuming that you added her coverage when you first went to work with the airline you will be fine.  It was just coincidental that she was diagnosed with cancer shortly after joining the group.

You obviously are stuck with confusing paper-work and nobody is giving you any details.  If the timing of her diagnosis is just a coincidence your health insurance will eventually pay the claim.  They are just looking for verification that she was healthy at the time she joined the group.

Even if she had a pre-existing condition, federal COBRA laws require that she is still covered if she went no more than 63 days without health insurance for the previous 18 months.

The only thing that you would need to worry about is if she did not pay health insurance premiums until after she started showing symptoms.

I know that these delays are confusing but my advice is “Hang In There.”

Although you have the option to hire an attorney, insurance companies tend to slow down even further once the courts get involved. I have to admit that it is rare that an insurance company’s battery of lawyers lose in court. It is more common that they drag things out hoping that you will run out of money to pay your lawyer and drop the case.

There is another faster process that is available to you. It does not allow them to drag things out.

The first thing that you need to do is “File An Appeal.” To do that, call the customer service number on your ID card and calmly ask them how you can file an official appeal. If nothing else, this process should let you know why you are getting the run-around. Make certain you document when you called and to whom you spoke. It would not hurt for you to record your understanding of what you are told to do and why.

Once you find out what the hold-up is, if you do not agree with them, file a complaint with the TX Department of Insurance. They will investigate and inform you within 90 days if your complaint is “justified” or “not-justified.”

If it is a justifiable complaint, they will help you get things corrected. If it is not justifiable, they should help you understand what point of contract law you are missing. Insurance companies are able to draw things out in court for several years but the State Department of Insurance has the authority to kick them out of the state and assess a fine if they are not abiding by the terms of your health insurance policy.

Insurance companies try not to intentionally hack off the Department of Insurance.  They are just too powerful.  If you want quick action, try the Department of Insurance before you hire a lawyer.

In addition, it does not cost you a dime to complain with the Department of Insurance. Save the hassle and expense of hiring an attorney as a last resort.
PS: In the event of a “worst case scenario” don’t give up. If your wife was already been diagnosed with cancer and ABC INSURANCE COMPANY cancels her health insurance, she can get coverage through the Texas Health Insurance Risk Pool. Just save that as a last resort. It is very expensive but not nearly as expensive as cancer treatments.

I hope this helps. As I said, since I do not know all the details I am only able to give you my suspicions. I may be correct or I could just be blowing smoke. Once you file an appeal, you should find out if there is a genuine problem or just miscommunication.

Since this exchange I have learned more information.  Apparently, the problem does not rest with the insurance company.   They were only doing what this individual’s Human Resource department has told them.

The lesson to be learned is, “Know what the problem is before you complain.”  The only way to solve a problem is to know exactly what the problem is.  In this climate it is assumed that all problems with insurance are the fault of the insurance companies.  That is not always the case.  Often when there is a problem with insurance it is caused by someone other than the insurance company.

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