The California Department of Managed Health Care (DMHC) has issued a cease and desist order against UnitedHealthcare division PacifiCare of California, contending the health plan engaged in "dishonest and unfair" business practices. While the scale of the case is relatively small--it involves about 500 patients enrolled with a medical group in Redwood City--the matter is significant. It's only the second time in the DMHC's six-year history that it has issued such an order. What's upset the DMHC is the way in which PacifiCare handled a physician contract termination. According to a complaint filed with the state, PacifiCare sent the 500 patients a letter saying their physicians had decided to leave the plan, when it had actually terminated the physicians itself. The state contends that PacifiCare knew it was going to terminate the physicians for more than a year, and that it should have let consumers know well in advance so they could choose a different insurance company if they wished.
To learn more about the case:
- read this San Jose Business Journal article
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