Insurance Denials Based on Pre-Existing Medical Conditions on the Rise
Coverage denials for U.S. residents with pre-existing conditions increased by about 50% from 2007 to 2009, more than three times faster than the growth of coverage applications, according to a House Energy and Commerce Committee report released on Tuesday, CongressDaily reports (McCarthy, CongressDaily, 10/12).
The report found that four of the largest health insurers -- Aetna, Humana, UnitedHealth Group and WellPoint -- rejected more than 651,000 individual applications for health insurance coverage during the three-year period (Heavey, Reuters, 10/12).
The report was distributed to panel members by committee Chair Henry Waxman (D-Calif.) and Oversight and Investigations Subcommittee Chair Bart Stupak (D-Mich.), who launched the investigation into insurers' coverage and claims denial practices before the federal health reform law was enacted.
For the investigation, researchers examined 68,000 pages of documents, such as internal communications and presentations, which the committee had requested from the four insurers in March (Norman, CQ HealthBeat, 10/12).
The report found that:
- In 2009, the companies rejected 257,100 applicants in the individual market, up from 172,400 such applicants in 2007;
- Staff at one company discussed an "improved pre-existing exclusion process" as a strategy to increase business (Armstrong/Nussbaum, Bloomberg/Philadelphia Inquirer, 10/13);
- One company maintained a list of 425 conditions or diagnoses that could be used to deny coverage for applicants, including pregnancy, angina, diabetes and heart disease;
- Another company circulated a memo clarifying that internal reviews were unnecessary for applicants who had a "surgical condition," were pregnant, received fertility treatments within the past five years or had a body mass index above 39;
- A company in July 2009 broached the idea of extending the "look back" period, during which insurance companies can review a customer's medical records to identify pre-existing conditions; and
- The companies examined new methods to expand their ability to avoid paying for pre-existing conditions (CongressDaily, 10/12).
The report did not identify which companies performed which actions, according to Bloomberg/Philadelphia Inquirer (Bloomberg/Philadelphia Inquirer, 10/13).
Waxman and Stupak warned that the actual number of individuals prohibited from accessing coverage could be higher because insurers do not have to report the number of people who might have been discouraged by insurance brokers from seeking coverage because of a pre-existing condition.
Proponents To Use Information To Promote Overhaul
Proponents of the health reform law likely will use the report as evidence that implementing the overhaul is necessary, CongressDaily reports (CongressDaily, 10/12).
Stupak and Waxman already have begun to tout the reform law as a possible solvent for coverage denials. They noted that the health reform law would "significantly reform" insurers' coverage denial practices, which they believe "would continue unabated in the absence" of the law.
Under the overhaul, insurers in 2014 will have to stop coverage denials for adults. A similar requirement for children took effect last month (CQ HealthBeat, 10/12).
Second Report Highlights Insurers' Maternity Coverage Practices
A separate report also released on Tuesday by Waxman and Stupak found that "women who are pregnant, expectant fathers, and families attempting to adopt children are generally unable to obtain health insurance in the individual market," The Hill's "Healthwatch" reports (Pecquet, "Healthwatch," The Hill, 10/13).
The report found that some of the companies did not adhere to maternity care policies issued for women who were not already pregnant, although some sold additional rider policies to cover pregnancy.
Changes to maternity coverage under the health reform law are not scheduled to take effect until 2014 (Reuters, 10/12).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.