Profession
WellPoint settles with Calif. hospitals over rescission payments
NEWS IN BRIEF — Posted Aug. 18, 2008
WellPoint Inc. agreed to pay $11.8 million to California's hospitals to settle allegations that the company illegally canceled patients' health insurance policies after authorizing treatment and then failed to pay the hospital bills.
The case parallels a similar class-action lawsuit brought by the California Medical Assn. on behalf of state physicians. That case is pending.
Under the July settlement with the California Hospital Assn. and more than 400 of the state's hospitals, WellPoint-owned Anthem Blue Cross agreed to establish a compensation fund to reimburse hospitals for the services they provided to patients whose policies were rescinded. The insurer also will set up a patient compensation fund to reimburse patients for their out-of-pocket payments to hospitals.
The hospitals agreed not to pursue reimbursement from patients for claims not paid by Anthem. The agreement awaits final approval by a Los Angeles trial court.
WellPoint admitted no wrongdoing as part of the settlement. Leslie Margolin, president of Anthem Blue Cross, formerly Blue Cross of California, said the company continues to work with state insurance regulators on the rescission issue.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2008/08/18/prbf0818.htm.
