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Friday, March 19, 2010

Have they really sunk this low?

Insurance companies have demonstrated some pretty egregious practices when it comes to who they'll cover and if they'll take away coverage. We've heard horror stories, but this one takes the cake. Reuters reported yesterday that in 2002, 17-year-old Jerome Mitchell, a college freshman, was dropped from his insurance plan because he was diagnosed with HIV.

According to the article,

Shortly after his diagnosis... his insurance company, Fortis [now Assurant Health], revoked his policy. Mitchell was told that without further treatment his HIV would become full-blown AIDS within a year or two and he would most likely die within two years after that.

Jerome took his insurance company to court, and thankfully won a substantial sum in damages. However, in the process of his court case, more despicable details came out about his insurance company. According to Reuters,

Previously undisclosed records from Mitchell's case reveal that Fortis [now Assurant Health] had a company policy of targeting policyholders with HIV. A computer program and algorithm targeted every policyholder recently diagnosed with HIV for an automatic fraud investigation, as the company searched for any pretext to revoke their policy.

It might take a second for that to sink in. Essentially, it's saying that his insurance company was literally hunting down people who were diagnosed with HIV in the hopes of finding some reason to kick them off their rolls.

It's hard to believe, but the insurance company is revealed as even more heartless as the story unfolds. CEO Don Hamm admits that this process of rescission is a common practice.

Hamm insisted before the committee that rescission was a necessary tool for Assurant and other health insurance companies to hold the cost of premiums down for other policyholders.

Or in other words: Revoking HIV patients' coverage after they have paid money into the company is a way to make large profits. Health reform will stop these kinds of practices and ensure that people paying for coverage are actually covered when they need care.