Former Health Insurance Executive Explains How Companies Pocket Billions Through ‘Rescission’

[ProSense]

Former Health Insurance Executive Explains How Companies Pocket Billions Through ‘Rescission’

NOTE: This is the first installment of our series — Meet Your Insurance Company Executive: An Interview with Wendell Potter.

Yesterday, ThinkProgress talked with Wendell Potter, Cigna Health Care’s former Communication Director, about a common and widespread practice among insurance companies called “rescission.” As the former Cigna executive explains, rescission is the insurance industry practice of finding reasons — even reasons as flimsy as typos on your enrollment form — to cancel your coverage when you get sick. According to Potter, insurance companies are saving billions by rescinding coverage from Americans who purchase individual insurance:

POTTER: If they determine that you might have left out something that they consider pertinent on your application and might have indicated that you would have had some illness or might get an illness down the road, and you’ve been getting treatment and submitting claims to your insurance company, they will go back and look at that application and they will often rescind or cancel your policy even if you’ve been paying your premiums on-time, every month, for years. You will be left holding the bag with the responsibility of paying all of your medical care when insurance companies do this. They’ve been doing it for many years and saving billions of dollars as a result of this.

Watch it:

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Rescission is widespread – an investigation by the House Subcommittee on Oversight and Investigations found that three insurance companies alone (WellPoint, UnitedHealth and Assurant) cancelled more than 20,000 policies in the last five years.

Edited to add last paragraph.

[Oregone]

1. Theyll pocket billions with mandates too

[depakid]

2. Just remember that "they're not bad people."

[HopeOverFear]

3. Thank you