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Blue Cross of California Busted for Doctor-Patient Letters

Posted by Jane Akre
Wednesday, February 13, 2008 11:55 AM EST
Category: Major Medical, Protecting Your Family, In The Workplace
Tags: Medical Malpractice, Bad Faith Claims, FDA and Prescription Drugs

Blue Cross of California was the subject of an expose by the Los Angeles times about its practice of writing letters to doctors to have them cross check for preexisting conditions.


Blue Cross of California had been trolling for patients it could drop from its rolls by sending out letters to doctors asking for their help.  The practice has been going on for years with the company sending out about 1,000 letters a month.

But the state’s largest for-profit health insurer stopped that practice Tuesday after an expose in the Los Angeles Times attracted criticism from doctors, patients, the governor and even a presidential candidate.

Blue Cross would send out copies of health insurance applications filled out by the patient along with the letter asking the doc to cross check their accuracy and reminding doctors that the company had a right to drop members who failed to disclose information.

Conditions for cancellation might include a failure to disclose “material medical history” such as a pre-existing condition or pregnancy.

“Any condition not listed on the application that is discovered to be pre-existing should be reported to Blue Cross immediately” the letter says according to the Los Angeles Times which broke this story.

In a statement issued about 6 p.m reacting to the story, the state's largest for-profit insurer said, "Today we reached out to our provider partners and California regulators and determined this letter is no longer necessary and, in fact, was creating a misimpression and causing some members and providers undue concern.

Gov. Arnold Schwarzenegger calls the letter “outrageous” and described it as asking doctors to “rat out the patients.”  

Senator Hillary Clinton says the Blue Cross letters are “another example of how insurance companies spend tens of billions of dollars a year figuring out how to avoid covering people with health insurance.”

The head of the states largest medical group calls it an “obnoxious intrusion” into the doctor-patient relationship.

In the past, Blue Cross has cancelled patients insurance after the patient runs up major medical costs.  That practice known as rescission, is under investigation by state regulators and the courts.

According to a spokeswoman for Blue Cross parent WellPoint Inc., the company had received no complaints for years.

Other state insurers say the practice is not widespread.

“Our business is healthcare but our customer is humanity” is the WellPoint slogan. The company says one in nine receive coverage from WellPoint with 34 million members nationwide.

The company is now trying to check applications more closely before issuing coverage to keep costs down and to guard against fraud . #



Anonymous User
Posted by Phyllis Loudermilk
Wednesday, February 13, 2008 2:13 PM EST

Just another reason why BCBS has become a dirty word in the health insurance business. I think I'm better off on my own than working with a company that doctor's offices don't want to accept and a company that works so hard at raising premiums and trying so hard not to pay claims!

Anonymous User
Posted by Gary Fisher
Wednesday, February 13, 2008 4:35 PM EST

Another example of this is with Vision Service Plan (VSP). VSP is an eyeglass plan, not a medical insurance. They are forcing eye doctors to reveal your medical history and not just your eye medical history, to VSP or the doctor will not get paid. I have no idea why an eyeglass plan needs to know your medical history but you can be assured that it is not for the patient's benefit.

Anonymous User
Posted by mardoudan
Wednesday, February 13, 2008 5:01 PM EST

My doctor refused to deal with BCBS anymore and told me I would have to pay him in full for services and get the reimbursement from BCBS myself. It's outrageous. BUT, I don't believe Government sponsored universal health care will be much better. Believe me, you get what you pay for! I have been recieving VA Medical Benefits care from my disability during my tour in the USAF. Yes, it is better than nothing, but it certainly leaves a lot to be desired. The VA does care, but it has limits and policies that prevents the patient from getting the best treatments that are available. I ended up using my private medical resources to get current state of the art medical care and attention. My health has improved since I got away from government sponsored health care. Do you relly think that Hillary or Barack can make this any better? I don't.
Believe me you get what you pay for. If its free and provided by the government it will be the bare minimum. I'd rather have the Ron Paul ( LINK ) freedom to choose my health care and pay for it with the money in my pocket that BIG government is taking away from me with high taxes, due to extreme military spending, and a foreign policy that is bankrupting America. I feel very sorry for the poor fools that are eating out of the hands of the US Government.

Anonymous User
Posted by jane Akre
Wednesday, February 13, 2008 5:10 PM EST

Dennis Kucinich was the only presidential candidate to propose getting the middle man- insurance - out of the healthcare picture.

Control costs by emphasizing health rather than sickness and disease and drugs!

Just a thought!

Posted by Doug Kauffman
Thursday, February 14, 2008 12:48 PM EST

Who you gonna trust? Hillary? Barack? Huck? McCain?
The system has been built over many years with many different interests involved. we really need to standardize plans nationwide, the government should provide stop loss insurance to private plans with standardization. by doing that, prices will stabilize, and companies cab still custom design their plans within their umbrella. 2nd. We need to stabilize pricing the same way as we do with medicare, including the price of prescription drugs.
3rd. We need to take out special interest providers that take advantage of the current system. Statistics have shown that Doctors who own interests in imaging centers are 4 times more likely to order images for their patients, than doctors who do not.

Anonymous User
Posted by Jane Akre
Thursday, February 14, 2008 8:38 PM EST

Hi Doug-
This reminds me a story we did recently on Merck boosting the price for drugs it sells to Medicaid under 15 different pricing schemes. The drug makers are supposed to sell the govt. the drug at the lowest price- Merck got caught this time but how often does this happen and no one knows about it?


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