As we watch the vote counting in the House over healthcare reform some stories remind us why we need such reforms enacted in the first place.
Such as the case in South Carolina that revealed one insurer had a policy of revoking coverage for all HIV positive policy-holders. Reuters has the details:
In May, 2002, Jerome Mitchell, a 17-year old college freshman from rural South Carolina, learned he had contracted HIV. The news, of course, was devastating, but Mitchell believed that he had one thing going for him: On his own initiative, in anticipation of his first year in college, he had purchased his own health insurance.
Shortly after his diagnosis, however, his insurance company, Fortis, revoked his policy. Mitchell was told that without further treatment his HIV would become full-blown AIDS within a year or two and he would most likely die within two years after that.
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Faced with the possibility of having his health insurance policy revoked for no good reason, Mitchell sued Fortis (which later became Assurant Health) and he won.
In 2004, a jury in Florence County, South Carolina, ordered Assurant Health, part of Assurant Inc., to pay Mitchell $15 million for wrongly revoking his health insurance policy.
Previously undisclosed records from Mitchell’s case reveal that Fortis had a company policy of targeting policyholders with HIV. A computer program and algorithm targeted every policyholder recently diagnosed with HIV for an automatic fraud investigation, as the company searched for any pretext to revoke their policy. As was the case with Mitchell, their insurance policies often were canceled on erroneous information, the flimsiest of evidence, or for no good reason at all, according to the court documents and interviews with state and federal investigators.
The details that have emerged showed that Fortis tried to hide its decision-making process of its “rescission committee” – which can be better known as the committee that decides which previously insured policymakers who are now sick who get their policies revoked. In Mitchell’s case, Reuters reports that his policy was revoked because of a single erroneous note from a nurse that said he might have contracted HIV prior to buying his insurance policy.
Like other major health insurance companies, Fortis has a “rescission committee” that reviews recommendations to cancel a policyholder’s insurance. But in the case of Fortis, Nettles wrote, the committee rarely did more than “rubber stamp” already flawed recommendations.
“There were no rules, no minutes, no notes, and, in accordance with instructions from general counsel not even a record of who was present,” the judge wrote about the committee.
During the meeting in which Mitchell’s insurance was rescinded, “there were more than 40 other customers, whose cases appeared before the rescission committee for review in no more than one and one half to two hours, representing an average of three minutes or less per customer,” he wrote.
According to [presiding judge, Michael G. Nettles, a state circuit judge for the 12th Judicial District of South Carolina, of Florence County], Fortis concealed information through its document retention practice. The company’s “stated policy for the last nine years has been to microfilm and destroy all documents,” the judge said. “There was also evidence that documents and/or records regarding (Mitchell’s) policy were deleted; and that telephone logs and recordings contained key omissions.” Fortis also “shredded” documents, he said.
Regarding another piece of key evidence, the judge concluded that “a jury could easily infer that Fortis destroyed and/or concealed” crucial evidence.
The story goes on to note that “no evidence has emerged that any other major American company purged policyholders simply because they had HIV” although people with other illnesses had their insurance revoked with no “legal basis.”
But an investigation last summer by the House Energy and Commerce Committee as well as earlier ones by state regulators in California, New York and Connecticut, found that thousands of vulnerable and seriously ill policyholders have had their coverage canceled by many of the nation’s largest insurance companies without any legal basis. The congressional committee found that three insurance companies alone saved at least $300 million over five years from rescission. One of those three companies was Assurant.
The committee estimated that Assurant alone profited by more than $150 million between 2003 and 2007 from rescission.
Mitchell’s case is not the only news coming out of South Carolina regarding those with HIV/AIDS. The proposed state budget has a one-two punch of eliminating all funds for HIV prevention and all money for drug assistance for those who are HIV positive.
The State reports:
The current version of the state budget for the 2010-11 fiscal year, which starts July 1, eliminates all money for the Drug Assistance Program, which provides life-saving HIV/AIDS drugs to the state’s low-income, uninsured and underinsured residents.
The budget also eliminates all money for the state’s HIV/AIDS prevention programs.
Without the state funding, matching money from the federal government is also in jeopardy.
The cut would mean the 2,055 people enrolled in the Drug Assistance Program would no longer get help in paying for their medication and could face dire health consequences.
South Carolina is thought to be the first state in the nation to propose the elimination of its entire HIV/AIDS budget.
Meanwhile New Jersey is considering eliminating all funding for family planning services for low-income family. The Philadelphia Inquirer reports:
Family-planning centers that largely serve low-income women would lose all of their state funding – $7.5 million – under the budget Gov. Christie proposed Tuesday.
The cut, one of many in Christie’s plan, falls in line with his clearly stated goal of slashing spending, but also appears to be one of the few early actions on social issues from a governor who so far has focused on making New Jersey affordable.
Michele Jaker, executive director of the Family Planning Association of New Jersey, said the cut could cost clinics federal dollars and would result in more unwanted pregnancies. She said studies had shown that every $1 spent on family planning saved taxpayers $4 in other costs.
“It makes absolutely no sense fiscally,” Jaker said. “Because of that, I can only think that it’s a social-policy decision, and it’s clearly out of line with what most New Jerseyans want or expect.”
The family-planning agencies provide gynecological care, screenings for breast and cervical cancer, contraception, care for sexually transmitted infections, and HIV tests, sometimes at no cost to needy patients, Jaker said. Some provide abortions, but he said state and federal funding had not been used for that procedure.
Bonus item: Turns out low-income girls are also not getting access to the cervical cancer prevention vaccine.
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