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House Committee Chairs Ask Insurers to Ban Rescissions Ahead of Health Reform Implementation

WASHINGTON, D.C.(ENEWSPF)—April 27, 2010. Committee and Subcommittee Chairs from the House Committees on Ways and Means, Energy and Commerce, and Education and Labor today sent a letter to the CEOs of seven insurance companies, most of whom last week announced they were allowing individuals up to age 26 to get coverage through their parents’ health insurance, ahead of health reform legislation taking effect.

The letter urges the firms to end the practice of rescissions — terminating an individual’s coverage once he or she becomes sick — except in cases of fraud or material misrepresentation.  The letter also asks that these insurers institute independent third-party review whenever a policy is to be rescinded or canceled.

The letter was signed by House Ways and Means Chair Sander M. Levin (D-MI), House Energy and Commerce Chair Henry A. Waxman (D-CA), House Education and Labor Chair George Miller (D-CA), House Ways and Means Health Subcommittee Chair Pete Stark (D-CA), House Energy and Commerce Health Subcommittee Chair Frank Pallone (D-NJ), House Energy and Commerce Oversight Subcommittee Chair Bart Stupak (D-MI), House Energy and Commerce Chairman Emeritus John D. Dingell (D-MI), and House Education and Labor Health Subcommittee Chair Robert Andrews (D-NJ).

The text of the letter appears below.

April 27, 2010

Angela F. Braly

Chair of the Board, President, Chief Executive Officer

WellPoint Inc.

 

George C. Halvorson

Chairman and Chief Executive Officer

Kaiser Permanente

 

Don Hamm

President and Chief Executive Officer

Assurant Health

 

Stephen J. Hemsley

President and Chief Executive Officer

UnitedHealth Group Inc.

 

Michael B. McCallister

President and Chief Executive Officer

Humana Inc.

 

Scott P. Serota

President and Chief Executive Officer

Blue Cross Blue Shield Association

 

Ronald A. Williams

Chairman and Chief Executive Officer

Aetna Inc.

 

Dear Madam and Sirs:

Last week, most of your companies announced plans to implement ahead of schedule the provision in the health reform law allowing individuals up to age 26 to obtain coverage through their parents’ health insurance.  This step will help many bridge the gap between graduation and the effective date of this requirement.  This decision signals that you are willing to work to make health insurance more accessible and affordable.  We commend you for this step.

Also last week, Secretary Sebelius, reacting to recent media reports, wrote to Ms. Braly asking that WellPoint immediately end its efforts to rescind health insurance coverage except in cases of fraud or intentional misrepresentation of material fact.  These rescissions hurt patients who need coverage the most, such as women diagnosed with breast cancer.  We are writing to ask all of your companies to end any such abusive practices immediately.

In addition, to ensure that rescissions occur only in cases of fraud or intentional misrepresentation of material fact, we request that each of your companies immediately institute a policy of independent, external third party review.  Under such a procedure, no individual health insurance policy should be rescinded until the review confirms that fraud or material misrepresentation has in fact occurred.

Taking these actions now would be consistent with your earlier decision to implement consumer protections for individuals under 26 voluntarily and would further demonstrate a commitment to reliable coverage for your policyholders.

Sincerely,

Sander Levin

Chair, House Committee on Ways and Means

 

Henry A. Waxman

Chair, House Committee on Energy and Commerce

 

George Miller

Chair, House Committee on Education and Labor

 

Pete Stark

Chair, House Ways and Means Health Subcommittee

 

Frank Pallone, Jr.

Chair, House Energy and Commerce Health Subcommittee

 

Bart Stupak

Chair, House Energy and Commerce Oversight Subcommittee

 

John D. Dingell

Chairman Emeritus, House Committee on Energy and Commerce

 

Rob Andrews

Chair, House Education and Labor Health Subcommittee

 

cc: Karen Ignagni, America’s Health Insurance Plans

 

Source: waysandmeans.house.gov

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