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Over the last 5 years, California patients have been plagued by the practice of insurance companies retroactively canceling health insurance coverage after they get sick - so called "rescissions" - leaving patients without health care when they are sick and need it most. Cancelled patients are virtually uninsurable and often hundreds of thousands of dollars in debt while facing ongoing medical treatment.
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"RNs see the damage done to patients every day by insurance companies," said Malinda Markowitz, RN and member of the council of presidents of the California Nurses Association. "Insurance companies should not be allowed to cancel the health care of innocent patients and the legislature should not allow the Governor to water down existing law to benefit his largest contributors."
In 2007, Governor Schwarzenegger's Administration promised to protect innocent patients from rescission in new regulations. Those regulations have stalled. Now, the governor's office has drafted legislative language that retreats from that promise and that would weaken existing law. The governor's bill would repeal the ban on "post-claims underwriting" in Health & Safety Code Section 1389.3 which bars health insurers from rescinding or limiting a policy in anyway after a patient gets sick unless the insurer can show that the patient "willfully misrepresented" a material health fact on their enrollment application.
Download the governor's bill here: http://www.ConsumerWatchdog.org/resources/Gov.pdf
Given the extreme hardship placed on patients whose coverage has been retroactively cancelled, the groups said it is critical that any legislation approved by the legislature and signed by the governor includes a clear and unambiguous requirement that only patients that "willfully misrepresented" their health history on their enrollment application can be rescinded.
"Too many Californians discover that the insurance they counted on isn't there at the very time they need it. We need strong legislation to make insurers honor the policies they issue and to protect patients unless they willfully misled their insurance company," said Gary Passmore, Director of the Congress of California Seniors.
Currently insurers cancel coverage when patients get sick citing so-called "omissions" on a patient's enrollment application - induced by the intentionally vague and misleading questions on the applications - regardless of whether patients intentionally misrepresented their medical histories as the law requires.
"Insurance should be something that you can count on," said Don Ernst, President of Consumer Attorneys of California. "Health insurance companies are failing to live up to their promises: broken promises equals broken people."
On numerous occasions Governor Schwarzenegger has promised to protect innocent patients from rescission of health insurance policies:
-- "[It is] outrageous that innocent patients have to live in fear of losing their health care coverage. I look forward to working with my partners in the Legislature to ensure this egregious practice is stopped." Dorsey Griffith, Sacramento Bee, "Patients gain a victory; Insurance reinstated for some; thousands more get reviews," April 18, 2008.
-- "As I've said before, patients should not live in fear of unfairly losing their healthcare coverage when they need it most - and I look forward to working with the Legislature to ensure this egregious p
