Health plan industry addressing policy cancellations

Hoping to get some control of a situation that is rapidly deteriorating into a series of regulatory fines, lawsuits and heinously bad PR, the health-insurance industry is mounting an initiative to deal with the issue of retroactive policy cancellations. Industry group America's Health Insurance Plans has begun pushing state regulators to adopt a draft bill giving consumers the right to appeal rescissions to an external panel. Decisions by the panel, which would be composed of independent healthcare professionals and lawyers, would be binding on all parties. Meanwhile, some individual insurance companies, such as Blue Cross of California, are preparing to roll out their own independent review programs.

The initiative comes in the wake of several legal actions that have slapped health plans engaging in these cancellations. Last week, for example, a California judge awarded $9.4 million to a hairdresser whose medical coverage was canceled by Health Net while she was being treated for breast cancer. Health Net also faces a suit filed against it by the Los Angeles city attorney, who contends that the plan engaged in a concerted campaign to cancel patients' policies when they became ill. 

To learn more about the health insurance industry's plans:
- read this piece from The Wall Street Journal

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