Health Insurance (Op-ed)
The private health insurance industry hires armies to both find healthy people to insure and then combs through records to terminate those people when their medical costs become too large of a "business expense." Terminations for preexisting conditions or illnesses not covered are euphemized as "rescissions" by the companies.
Terminations are one way the companies meet Wall Street's expectation for higher profit margins year after year. Terminations also help support excessive executive pay for CEOs and their platoons of senior executives aka senior VPs, executive VPs, VPs, Regional VPs, etc.
On June 16, Bart Stupak (D-MI), Chair of the House Commerce Subcommittee held a three-hour hearing, “Termination of Individual Health Insurance Policies.” To clarify, the hearing was concerned with individual policy market, not with employer-sponsored group health care.
Among the discoveries was that the total compensation for one of the insurance CEOs (identity not revealed in the hearing) was $1.2 BILLION
That rescission of policies had netted companies savings of $300 million.
Claims department performance is graded according to how much is saved by rescinding policies. One employee was heralded for saving $10,000,000 by canceling policies when claims were posted.
Insurance companies have flags based on potential costs that trigger an investigation (WellPoint has 1,400 of them), the sole purpose of which is to not only deny the immediate claim, but of rescinding the entire policy-- usually all the way back to the original date of issue. In addition to now having zero health insurance coverage, the insured must also reimburse the company for any and all paid claims under the policy.
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