Annals of outrageous health insurance evil

How to make a judge mad: After policyholders are diagnosed with HIV, find false excuse to cancel their insurance


Andrew Leonard
March 18, 2010 6:02PM (UTC)

Any House Democrats still wavering over their vote on health care reform should take some time to read this Reuters story reporting how one health insurance company specifically targeted policy holders who became diagnosed with HIV and then cancelled their policies, using any excuse that could be manufactured. (Via Consumerist and Naked Capitalism.)

The company in question, Fortis, now called Assurant Health, also appears to have destroyed documents and electronic records related to its "rescission" decisions -- the practice of revoking health insurance previously granted. In the case of Jerome Mitchell, who fought back and sued Fortis after his policy was revoked, the South Carolina Supreme Court declared the insurer's behavior "reprehensible."

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Previously undisclosed records... reveal that Fortis had a company policy of targeting policyholders with HIV. A computer program and algorithm targeted every policyholder recently diagnosed with HIV for an automatic fraud investigation, as the company searched for any pretext to revoke their policy....[T]heir insurance policies often were canceled on erroneous information, the flimsiest of evidence, or for no good reason at all, according to the court documents and interviews with state and federal investigators...

Their motive, according to the judge, was obvious: "The court finds that Fortis wrongfully elevated its concerns for maximizing profits over the rights and interest of its customer." In upholding Nettles' verdict, the South Carolina Supreme Court similarly ruled that "Fortis was motivated to avoid the losses it would undoubtedly incur in supporting Mitchell's costly medical condition."

Read the whole story.


Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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