The fall health insurance enrollment period is shaping up as one to remember.
With major insurers abandoning the Affordable Care Act exchanges in some states and premium increases abounding, litigation now promises to add to the tumult.
Consumer advocates in California said today they are suing one of the state’s major exchange coverage providers for attempting to force consumers to renew policies that have been significantly altered, to the detriment of the policyholders.
Consumer Watchdog said it filed a class-action suit on behalf of Anthem Blue Cross policyholders alleging that the insurer is attempting to force policyholders to renew plans that include a huge coverage gap: No coverage for services provided by physicians not included in the network.
“Anthem is breaking the law and its promises to consumers by attempting to automatically ‘renew’ its 2016 members for 2017 in coverage that actually provides no out-of-network care whatsoever. In an effort to retain its market share, Anthem is failing to adequately inform its members that they are losing out-of-network benefits for 2017,” said Laura Antonini, staff attorney for Consumer Watchdog.
According to a release from Consumer Watchdog, the suit alleges that, by automatically renewing the altered policies, individuals could be responsible for “thousands of dollars or more in medical bills that their existing plan covered, without them knowing it.”
In addition, it could result in the loss of access to physicians with whom they have had a relationship, “a prospect particularly harmful for those in the midst of treatment, as paying full cost of out-of-network care is untenable for all but the wealthiest.”
Consumer Watchdog asked the court to act quickly, given the limited time period for enrollment for 2017.
Anthem's Response
Anthem, through a spokesperson, told the Los Angles Times that it believes the suit is without merit.
Darrel Ng, an Anthem spokesman, told the Times that Anthem changed the plans’ design “to mitigate rate increases and keep monthly premiums affordable.”
“The benefit package being offered in 2017 was approved by the Department of Managed Health Care and Covered California and is consistent with federal guidance,” Ng said. “Affected members have been mailed written notice of this change so they can make an informed decision on their healthcare needs during the open enrollment period for the coming year.”
Consumer Watchdog said Anthem failed to make a full disclosure to existing policyholders of the scope of the change to their plans. Essentially, the scope of the plan redesign discontinued the preferred provider organization plans consumers signed on for a year ago, and thus Anthem should be required to tell consumers their plans have been eliminated.
Specifically, the lawsuit alleges that Anthem violated federal and state laws by:
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Failing to provide “guaranteed renewal” of existing coverage as required under the contract.
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Attempting to automatically “renew” members enrolled in preferred provider organization plans into exclusive provder organization plans “rather than correctly disclosing to consumers that Anthem is discontinuing their 2016 coverage.”
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Sending out misleading “renewal” notices rather than “discontinuation” notices.
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“We believe that Anthem is trying to take advantage of consumers during the Open Enrollment Period,” said Travis Corby of Shernoff Bidart Echeverria LLP. “They are selling 2017 Affordable Care Act health plans as being the same as their 2016 products. But they are not adequately informing consumers that the new plans provide no coverage if a physician is not participating in Anthem's network.”
