Making Your Health Insurance Company Pay Up by Jeffrey Dach MD

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Jeffrey Dach MD

Mar 3, 2008, 10:31:28 AM3/3/08
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Making Your Health Insurance Company Pay Up by Jeffrey Dach MD

Original article can be found here:

The Eight Hundred Pound Gorilla in the Health Insurance Industry

What do you do with an eight hundred pound Gorilla that misbehaves and
denies coverage for your medical bills? Patsy Bates found out this
week when a California court awarded her 9 million dollars for damages
arising from Health Net canceling her insurance coverage just when she
needed treatment for breast cancer. (41)(48).

How did her lawyer William Shernoff win against the eight hundred
pound Gorilla, Health Net? It's all in his book, "Fight Back and Win:
How to Get HMOs and Health Insurance to Pay Up", by William Shernoff.

Rocky Delgadillo, LA City Attorney, Modern Hero, Files Suit Against
Health Net for Canceling Due to Pre-Existing Condition

Also this week, Los Angeles City Attorney, Rocky Delgadillo filed suit
and criminal charges against the same company, Health Net, claiming it
unfairly canceled policies when patients needed expensive medical
treatment. This is also known as canceling for a Pre-Existing

Health Net Inc. saved about $35 million by illegally canceling the
coverage of at least 1,600 patients over four years, the city attorney
alleges in the lawsuit filed Wednesday.

The Pre-Existing Condition Gimmick

A typical ploy the insurance company uses to cancel insurance coverage
is the "pre-existing condition". Los Angelos City Attorney Rocky
Delgadillo said, "This is an industry with a history of putting
profits before people. Their practices are not only illegal, they are
immoral and we are going to hold them accountable." In November, state
regulators fined the company $1 million for lying about its incentive
program for reaching cancellation targets. Delgadillo's office is
pursuing a criminal investigation against individual employees who
received bonuses based in part on canceling policies of people who
have submitted substantial medical claims. California introduced new
legislation last week that prevents this abuse called, "cancellation
for pre-existing condition". (1)(2)(45)

July 15,2006 UnitedHealthcare Settles Complaint and Pays $600,000

"In what could be the largest penalty ever imposed by the state
against a health insurer, UnitedHealthcare of Wisconsin and two
affiliates will pay $600,000 for not adequately responding to consumer
complaints and grievances, not paying for certain benefits, and other
violations of state insurance regulations. The forfeiture was part of
a settlement reached with the Office of the Commissioner of Insurance
in November and announced on Friday. It stemmed from investigations
done in 2003 and 2004." (4) By Guy Boulton, The Milwaukee Journal
Sentinel Jul. 15, 2006.

Read the consumer complaints here. (5)

Jan 9, 2007 Nebraska is not happy with United HealthCare, Pays Fine

Jan 9, 2007, "UnitedHealthCare Group violated 18 insurance laws
hundreds of times during a review period, state insurance regulators
say. Nebraska Insurance Department attorney Ann Frohman said that
numerous complaints prompted a review of United HealthCare which
revealed decision delays, wrong decisions about coverage and bad
information given to consumers."(3)

Sept 6, 2007 UnitedHealthcare will pay $12 million in penalties,

" United HealthCare was forced to overhaul its claims handling
practices under a settlement announced Thursday with 37 state
insurance departments. Total penalties could rise to as much as $20
million if additional states join the agreement, UnitedHealthcare
said. The Minnetonka, Minn.-based unit of UnitedHealth Group had been
under investigation by 37 state regulators following nationwide
complaints about coordination of benefits, appeals and grievances,
explanation of benefits letters, utilization review procedures and
other areas of claims handling. Among other things, the investigations
found numerous claims processing errors, such as not applying correct
fee schedules and deductibles, according to a statement by the New
York State Insurance Department.

Under terms of the larger settlement, UnitedHealthcare will implement
a national claims handling improvement plan and undergo collective
monitoring of its market practices by the five states that led the
investigations: New York, Iowa, Florida, Connecticut and Arkansas. The
plan also establishes benchmarks for improving claims accuracy and
timeliness, reviewing appeals and handling consumer complaints, with
the possibility of additional penalties if it fails to meet those
standards." Quote credited to JoAnn Wojik Business Insurance(46)

New York Attorney General Andrew Cuomo, Modern Hero, Goes After United

February 13, 2008, New York Times: New York Attorney General Andrew
Cuomo Announces Industry Wide Investigation into Health Insurer's
Fraudulent Re-Reimbursement Scheme for Out-of-Network Doctor Visits.
This scheme involves out-of network doctor visits which are billed by
the doctor directly to the patient. The patient sends the a
reimbursement form with the bill into the insurance company. If the
out of network provision was purchased and part of the policy, the
insurance company will pay 80% of reasonable and customary fees. This
is where the fraud comes in. This reasonable and customary fee is
intentionally set low by Ingenix, a company owned by United
Healthcare, an obvious conflict of interest which bilks customers out
of millions. For example if the doctor's fee is $200, Ingenix says
the customary fee is $90, and they pay only 72 dollars instead of

"Health Insurers such as United Healthcare have been systematically
cheating patients and doctors of fair reimbursement for medical
services through the industry's arcane procedures for calculating
"reasonable and customary" rates", according to a New York Times
editorial. (New York Times, 2/18). (6)

United HealthCare Corporate Profits Going Up (7)

The Health Insurance Industry Should be Regulated Like A Public

Shares of UnitedHealth are up 563% for the five years ending 2004.
Their CEO McGuire was given 1.6 billion dollars in stock options.(47)
These obscene Corporate profits are maximized by rewarding employees
for not paying medical claims. Another gimmick to increase profit at
the expense of vulnerable sick Americans sick is the "Denial Engine".

What is a Denial Engine?

To stream line and expedite denial of medical claims, the health
insurance industry buys and uses "Denial Engine" Software. This is
computer software which can be adjusted to increase or decrease
medical claims denial rates depending on how much profit they want to
keep. (44)

Call or write your congressman and let him know that, just like
Florida Power and Light and other Public utilities, the health
insurance industry should be regulated by the state as a public

Stop Corporate Greed, and Take Action

Ask Your Legislature to Regulate Health Insurance like any other
Public Utility
The simple solution is for the states to regulate the health insurance
industry same way they regulate the public utilities. Some states are
actually starting this process of regulation. Lawmakers in several
states are passing new laws which limit health insurers' ability to
cancel health policies for pre-existing conditions. (45)

Get Your Own 800 Pound Gorilla to Help You

Toll Free Help Line
to File a Complaint, Call for Help at the Florida State Dept of
Insurance Toll-free Helpline,
8 a.m. to 5 p.m. M-F

Join with thousands of others who have filed complaints.
Make the Call. There is strength in numbers.

Contact Your State Insurance Commissioner and File a Complaint, the
State Regulators will start a review.

Do you have a complaint about your insurance company? Call or write to
your state insurance commissioner:

Florida Insurance Commissioner, Kevin M. McCarty
Commissioner of the Office of Insurance Regulation
Office of the Commissioner
200 East Gaines Street
Tallahassee, Florida 32399-0305

Outside Florida? Use this handy map to find your insurance
commissioner contact information for any state.(8)

Stop the Shakedowns, Make Your Insurance Company Pay Your Medical

Whether your health plan is a traditional insurer, a PPO or an HMO,
and whether it dismisses your claim or agrees to pay only part of the
bill--here are the steps to take:

These instructions are found here. (9)
1. Know Your Rights

When coverage is denied for a treatment or drug, it is up to you to
collect information and make the case for coverage. This is true
whether you are seeking pre-authorization before you receive a service
or are disputing an Explanation Of Benefits form sent to you in
response to an unreimbursed claim.

First, check your rights under your health-care plan and under state
law. If your employer provides your insurance, call your human-
resources department to get a copy of the policy. Read it carefully.
The policy will tell you what is covered and what mechanism you can
use to challenge your health plan's decisions. If you don't understand
the provisions, ask someone in human resources for help or call your
insurer's customer-relations number for an explanation.

Health plans are required to follow state and federal law for handling
complaints and appeals. Find out your own health plan's internal
review process, then follow it.

2. Contact the Insurer

Get your paperwork together before you call the health-plan insurer.
(You'll find the phone number on the form that was sent to you with
denial of your request for reimbursement. It also will be on your
policy.) Be prepared to lay out all the evidence to convince your
insurer that your position is correct.

Your dispute may be resolved with your first informal call, but that
call also may be the start of a lengthy process. Make a file and start
keeping accurate records of every contact you make: whom you spoke
with, the date of the conversation, what was said and when they said
the next step would occur.

3. File a Written Appeal

If you don't get results from a phone call, file a written appeal with
the health plan. To prepare the appeal, request a copy of your entire
claim file from the health plan, advises Jennifer C. Jaff, an attorney
who is the executive director of Advocacy for Patients With Chronic
Illness. The file will include the plan's specific rationale for
rejecting your claim. Tailor your letter to the plan's criteria for
denial or acceptance and attach supporting documents.

If the claim file says the treatment was "unnecessary," attach your
medical records. These should include test results and an explanation
of why other treatments have failed as well as a letter from your
doctor about why you needed that treatment.

If payment for your treatment is declined as "experimental," you'll
have to show that the procedure you had is now medically accepted. You
can do this by searching on the Internet or at your public library for
articles in medical journals that demonstrate the effectiveness of the
novel treatment you are trying to get covered.

Make sure you file the appeal within the designated time limit. Some
plans, for example, require that you challenge a reimbursement denial
within 60 days. The two biggest mistakes patients make in their
appeals are not providing enough background material to justify
coverage and not meeting deadlines.

4. Get Outside Help

If you have a chronic condition such as diabetes or cancer, or even a
rare condition such as Crohn's disease, the advocacy organization
devoted to that disease can help you frame your appeal. For example,
the website for the American Diabetes Association,,
provides information for people who are having trouble getting health-
care coverage. Although the website is targeted to people with
diabetes, the advice is helpful for all patients.

5. Demand An Independent Review

Starting in 1990, managed-care enrollment in the U.S. increased by
85%. As more patients signed up, more of them also began to complain
to their legislatures about denials of coverage by their health

State lawmakers listened: 43 states plus the District of Columbia have
enacted some version of a Patient's Bill of Rights. As a rule, these
laws give consumers the right to an independent medical review when a
health plan denies coverage for care or access to out-of-network

But few people make use of these mechanisms. In Illinois, where about
1.5 million people are enrolled in HMOs, only one in 225 members a
year files a complaint with the HMO. Far fewer--one in 2250--take the
appeal to the next level by asking for an independent review of their

That's a mistake. Although success rates differ from state to state,
consumers tend to prevail in these challenges about 50% of the time.

Health-care insurers made profits in the billions last year. Know your
rights, so profits will not be taken unfairly from your own benefits.

This is the Number to Call For Help:
Florida State Dept of Insurance Toll-free helpline,
8 a.m. to 5 p.m. M-F

Jeffrey Dach MD
4700 Sheridan Suite T
Hollywood Fl 33021


City Attorney Files Lawsuit Against Health Net Inc.February 21, 2008


CNN Money: LA Sues Health Net Over Cancellations, Los Angeles City
Attorney Sues Insurer Health Net, Alleging Scheme to Cancel Policies.
February 21, 2008:

Jan 9, 2007 UnitedHealthCare Accused Of Breaking Insurance Law. WCCO
Channel 4 TV

State fines health insurer $600,000, UnitedHealthcare settles
complaint, By GUY BOULTON
July 14, 2006, Milwaukee Journal Sentinel


A typical complaint found here: <quote>They are the worst company I've
ever had. They refuse to pay any of the claims, even though they
recognize they absolutely have to and should cover those charges. I've
spent hours on the phone with them for almost 3 months. At this point
my company is dealing with them through their representative to
resolve payments. It would be 10 times cheaper for me to just go to
the doctor and pay whatever then pay them and now I have to pay the
hospital too for whatever the reason is they can't explain..

EDITORIAL, A Rip-Off by Health Insurers? February 18, 2008 New York

Chart showing obscene profits of United Healthcare increasing every
year. Shares of UnitedHealth are up 563% for the five years ending
2004, versus a 17% loss for the benchmark S&P 500.

This is a Link to Your State Insurance Web Site - witn a Handy Map of
US, All States.

TAKE CONTROL OF YOUR HEALTH, Fight for Your Health Care, By Lori
Andrews Published: January 20, 2008 Parade

2002, Michael D. Maves, MD, MBA, Executive Vice President and Chief
Executive Officer, AMA, Letter to United HealthCare CEO Dr. William
McGuire complaining about miscoding CPT codes, etc.

USA Today, UnitedHealth CEO McGuire, retires amid options scandal
Updated 10/16/2006 9:13 AM ET

Tuesday, March 20, 2007 UnitedHealth Declares "The Health Care System
Isn't Healthy" - But Is the Company Part of the Problem?

Disputes with United HealthCare over payments

Uniterd HealthGroup Accused of Fraud

(15) Listing of News Stories on United Health Group

Press Release by Office of the Attorney General, Andrew Cuono

Andrew Cuomo to sue major health insurers By MICHAEL GORMLEY,
Associated Press Writer
Wed Feb 13.

Business Week, February 21, 2008, Wrangling Over 'Reasonable' Fees,
It's a no-holds-barred battle between health insurers and hospitals,
with customers caught in the middle. By Chad Terhune, with Brian Grow

Huffington Post, Falling in Love with Andrew Cuomo by Eve Gittelson
Feb 14 2008.

New York Times, Andrew M. Cuomo, New York State attorney general,
announced an inquiry into health insurance Wednesday. By REED ABELSON,
February 14, 2008


UnitedHealth unit charged with fraud New York state says alleged
practices left consumers shortchanged By Russ Britt, MarketWatch Feb.
13, 2008


Cuomo to Sue Biggest Health Insurer, Others to Receive Subpoenas Over
Reimbursements, N.Y. Attorney General Andrew Cuomo says he will sue
UnitedHealth over setting artificially low limits on how much patients
are reimbursed for medical-care claims. (By Robert Caplin -- Bloomberg
News) Washington Post


UnitedHealth Draws Criticism for Its Out-of-Network Reimbursement
Policies. I have posted a number of previous notes about UnitedHealth,
particularly with regard to its punitive policies toward physicians
for out-of-network lab testing.


Confessions of a Pediatric Practice Consultant, True stories from the
land of pediatric practice management.Andrew Cuomo, UnitedHealthCare:
Duh. February 14, 2008 . Cuomo's investigation also found a clear
example of the scheme: United insurers knew most simple doctor visits
cost $200, but claimed to their members the typical rate was only $77.
The insurers then applied the contractual reimbursement rate of 80%,
covering only $62 for a $200 bill, and leaving the patient to cover
the $138 balance.

NPR Radio story on Andrew Cuomo And United Health


Health Insurer to Face CRIMINAL CHARGES by California Nurses Shum, Fri
Feb 22, 2008 This could be the start of something huge. The sociopaths
who run our nation's health insurance corporations might--just might--
begin to face justice for the countless Americans that have suffered
at their hands. Health Net, one of the largest insurers in the
nation, is facing multiple civil and criminal charges for retroactive
recissions, their habit of kicking people off the insurance rolls as
soon as they get sick.This practice is not a coincidence--it's at the
heart of their business plan, in fact of the whole model of for-profit
health insurance. Los Angeles City Attorney Rocky Delgadillo was
brave in standing up to the practice,and justified. We need other
activist prosecutors to follow his lead, and help turn the public
disgust with insurance corporations into national momentum for
replacing them with universal, non-profit guaranteed coverage...also
known as single-payer healthcare.


L.A. sues insurer over cancellations, The city attorney says Health
Net defrauded policyholders by dropping patients who needed costly
care. By Lisa Girion, Los Angeles Times Staff Writer,February 21,


File your health insurer complaint with LA City Attorney Delgadillo:
"If you believe your health insurer has wrongfully denied or delayed
your claim and/or canceled your coverage, we urge you to provide us
with a description of your complaint. If you are a health care
provider who has had payment withheld, payment delayed or has been
retroactively denied payment for services rendered under a health plan
or insurance policy."


California Nurses Association. Submit Your Story Web Site. Are you
getting the healthcare you need, when you need it, at a price you can
afford? Nearly 48 million Americans have no health insurance at all
and nearly 50 million more are under insured with high deductibles and
co-pays discouraging them from seeking the care they need in the
preventative stages. We've created this form to collect your stories,
which may be used on our websites, in the news, to educate the public,
and/or at legislative hearings.


N.Y. Attorney General Investigation Highlights Problems In Navigating
Out-of-Network Charges


Legislation would crack down on insurers. Victoria Colliver, San
Fransisco Chronicle Staff Writer, Thursday, February 14, 2008. A
California lawmaker introduced legislation Wednesday that would
require health insurers to get permission from state regulators before
retroactively canceling a member's coverage. The bill, introduced by
Assemblyman Hector De La Torre, D-South Gate (Los Angeles County),
comes on the heels of news this week that Blue Cross of California had
been sending letters to doctors asking them to report pre-existing
conditions and discrepancies that could be used to cancel a new
member's policy.

Clinton Health Care Proposal called Managed Competition (Jan 1994)
starts on page 6 of document.
Under managed competition, all doctors and other caregivers will be
under the administrative
thumb of six or eight immense, for-profit insurance companies,which
will have gobbled up hundreds of smaller insurers.


UnitedHealth shakes up over Options by Shubha Krishnappa - October 16,
2006 The Money Times. McGuire, the longtime chief executive of
UnitedHealth Group Inc., who worked hard to turn the Group into a
behemoth in its field, was forced yesterday to resign from the company
and to give up a portion of the $1.1 billion he holds in severely
criticized stock options. The options that McGuire had been granted
over the years have led to criminal and civil investigations and
public disapproval.


Florida State Office of Insurance Regulation. The Office serves
Floridians through its responsibilities for regulation, compliance and
enforcement of statutes related to the business of insurance.

A Consumer Guide to Handling Disputes with Your Health Plan or
Insurance Carrier - Kaiser


The Book, Making Them Pay: How to Get the Most from Health Insurance
and Managed Care by Rhonda Orin "It's time to get down to business-and
that means learning the nuts and bolts of health plans..."


The Book, Fight Back and Win: How to Get HMOs and Health Insurance to
Pay Up by William Shernoff , Lawyer who won 9 million dollar
settlement from Helath Net last week.

Advocacy for Patients with Chronic Illnesses, Jennifer C. Jaff
attorney and founder of Advocacy for Patients with Chronic Illness,
Inc., a tax-exempt organization that provides free information, advice
and advocacy services to patients with chronic illnesses

Interview with Jennifer Jaff talking about finding and getting health
insurance, and then making them pay for your medical bills.

Law Firm of William Shernoff

Insurer fined $9M for dropping cancer patient. Cancellation had left
woman with more than $129,000 in unpaid bills. Insurance company pays
up. Feb. 23: A woman battling breast cancer had her policy cancelled
during her treatment. NBC's Chris Jansing reports that action is
costing the insurance company dearly.Associated Press.

LOS ANGELES - A woman who had her medical coverage canceled as she was
undergoing treatment for breast cancer has been awarded more than $9
million in a case against one of California's largest health
insurers. Patsy Bates, 52, a hairdresser from Lakewood, had been left
with more than $129,000 in unpaid medical bills when Health Net Inc.
canceled her policy in 2004. On Friday, arbitration judge Sam
Cianchetti ordered Health Net to repay that amount while providing
$8.4 million in punitive damages and $750,000 for emotional distress.


Florida State Division of Consumer Services, Medical Provider
Informational Memorandum Attention:Florida Medical Providers
Assistance, Complaints, Inquiries, online inquiry form. The state
regulatory agency with file inquiry with the insurance company.


February 14, 2008, NY AG on UnitedHealth Database: Garbage In, Garbage
Out Posted by Dan Slater , New York Times


What is a Denial Engine? That's the computer software that denies your
claim. Read more here:
Denial Engine Vendor Ingenix Keeps more than Usual and Customary
Dollars. In my warnings to providers about denial engines -- those
sophisticated analytics tools that payers are increasingly using to
reduce, deny, or re-collect claims payments -- I try to emphasize that
they can be used ethically.

States act to protect individual health insurance coverage, By Julie
Appleby, USA TODAY 2/21/08

UnitedHealthcare settles claims dispute, Sept. 06, 2007 By Joanne
Wojcik, NEW YORK--UnitedHealthcare will pay $12 million in penalties
and overhaul its claims handling practices under a settlement
announced Thursday with 37 state insurance departments. Total
penalties could rise to as much as $20 million if additional states
join the agreement, UnitedHealthcare said.

The Minnetonka, Minn.-based unit of UnitedHealth Group investigation
by 37 state regulators following nationwide complaints about
coordination of benefits, appeals and grievances, explanation of
benefits letters, utilization review procedures and other areas of
claims handling. There were numerous claims processing errors, such as
not applying correct fee schedules and deductibles, according to the
New York State Insurance Department.


McGuire, the longtime chief executive of UnitedHealth Group Inc., who
worked hard to turn the Group into a behemoth in its field, was forced
yesterday to resign from the company and to give up a portion of the
$1.1 billion he holds in severely criticized stock options. The
options that McGuire had been granted over the years have led to
criminal and civil investigations and public disapproval.

Health Net ordered to pay $9 million after canceling cancer patient's
policy Rick Loomis / Los Angeles Times

Patsy Bates, a breast cancer patient whose medical coverage was
canceled by her insurer, was awarded more than $9 million today in a
case against Health Net Inc., one of the state's largest for-profit

The punitive damage award is the first of its kind and has prompted
the giant medical insurer to scrap practices that have recently come
under fire. By Lisa Girion, Los Angeles Times Staff Writer February
23, 2008

Health Insurer Must Pay $9 Million for Canceling Sick Woman's Policy
After Precedent-Setting Judgment, Health Net Said It Will Stop
Controversial Practice, ABC News

actual pdf file of court ruling documents of patsy bates settlement
against healthnet

(c) 2008 jeffrey dach md all rights reserved
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