State Attorney General Targets Health Insurers
The California attorney general's office opened an investigation Thursday into allegations that the state's largest health insurers were rejecting medical claims at alarming rates.
The inquiry was prompted by a report released Wednesday by the California Nurses Association. The report suggested that the insurers rejected a fifth of all claims received over the past seven years.
"The public is entitled to know whether wrongful business practices are involved," Attorney General Jerry Brown said Thursday in a statement.
The California Association of Health Plans, an industry trade group, disputed the allegations.
"They're trying to represent it as if care was being denied, that people's health was being put at risk," said Nicole Kasabian Evans. "Their numbers distort the reality."
Some rejections were based on "paperwork issues" that, in many cases, were eventually resolved and had "little financial impact on consumers or impact the care received," she said.
The nurses union said some of the companies had denial rates between 27 percent and 40 percent during the first six months of this year, with PacifiCare rejecting 39.6 ercent of claims it received.
The CNA said Cigna rejected 32.7 percent, Health Net 30 percent, Kaiser Permanente 28.3 percent and Blue Cross 27.9 percent.
The union said it based its findings on financial data insurers are required to report to the state.
The Department of Managed Health Care, which regulates health maintenance organizations, said it would attempt to verify the accuracy of the union's data.