CMA Applauds Attorney General Probe, Says Insurers Must Be Held Accountable

The California Medical Association praised Attorney General Jerry Brown for subpoenaing the financial records of the state's seven largest insurers and investigating if they are illegally exercising market power and inappropriately denying claims, raising premiums or inaccurately rating doctors.


"California's top five insurers control 86 percent of the state's private health care market," said Brennan Cassidy, MD, president of CMA. "They use that power to force higher premiums on their policy holders, deny patients needed treatment, underpay providers and boost their profits at the expense of Californians."


Brown made the announcement the day after congressional investigators reported that Anthem Blue Cross, which proposed rates increases of up to 39 percent for some of its 800,000 California policy holders, provided its executives with lavish salaries and benefits. Anthem Blue Cross has sent $4.5 billion in profit to its parent company, WellPoint, Inc., since 2004, according to the Los Angeles Times.


A congressional subcommittee on Wednesday grilled WellPoint Chief Executive Officer Angela Braly about executive pay, including her own salary of $1.1 million and stock compensation valued at $8.5 million last year. Company documents obtained by congressional investigators showed the company paid 39 company executives $1 million or more in 2008 and spent more than $27 million for 103 executive retreats in 2007 and 2008.


Insurers' pursuit of profit and dominating market power has led to widespread misconduct that has resulted in numerous investigations, state violations and record-breaking fines. One standard industry tactic to boost the bottom line is to cancel coverage for patients once they become seriously ill and their medical bills mount. A congressional investigation in June 2009 found that three insurers used rescissions to cancel more than 20,000 policies over five years, saving the companies $300 million in claims.


In addition, Ingenix, a unit of United Health Group that operates in California, participated in a price-fixing scheme that relied on an obscure database to set artificially low reimbursement rates for out-of-network medical care. New York Attorney General Andrew Cuomo concluded that Ingenix data is intentionally manipulated to allow health plans to scam physicians by shortchanging reimbursements on medical bills.


"Californians have a right to know if insurers' market power and pursuit of profit is pricing them out of health care insurance and denying them necessary medical care," Cassidy said. "We look forward to seeing the attorney general's findings."


Source

California Medical Association

Buy Nimotop Without Prescription