WellPoint Exposed for Canceling Health Insurance Policies of Breast Cancer Patients

Published: Wed 28 Apr 2010

Wendy Blair

Kathleen Sebelius, the secretary of the Department of Health and Human Services, has asked health insurance company WellPoint to stop dropping the coverage of recently diagnosed breast cancer patients, a practice the secretary called "deplorable."

In a letter sent on April 22 to WellPoint's CEO, Angela Braly, Sebelius wrote that she was "surprised and disappointed" to find out from a Reuters report that the insurer had targeted policyholders with breast cancer for aggressive inquiries with the hope of canceling their coverage.

"As you know, the practice described in this article will soon be illegal," Sebelius said. "The Affordable Care Act specifically prohibits insurance companies from rescinding policies, except in cases of fraud or intentional misrepresentation of material fact."

On Thursday, Reuters reported that WellPoint, the biggest health insurance company in the United States by enrollment figures, used a computer algorithm to automatically single out policyholders who were recently diagnosed with breast cancer, among other ailments.

The software prompted an instant fraud investigation by the insurer as it dug for reasons to drop the coverage, according to federal investigators and regulators.

WellPoint's Response

WellPoint issued a statement in response to the Reuters report, saying it relies on software to scan the diagnostic codes for illnesses that policyholders probably would have known about when they applied for a policy, but maintained that it does not target women with breast cancer.

The insurer claimed that it altered its rescission practices to make sure they were conducted appropriately after a review of policies in 2006 spurred by public concern.

WellPoint's CEO answered Secretary Sebelius on Friday in a letter, claiming the Reuters story was inaccurate and egregiously misrepresented the insurer's efforts to assist patients in detecting and treating cancer.

"Breast cancer is a devastating illness and should not be politicized," Braly wrote, requesting a meeting with Secretary Sebelius to discuss the issue.

Secretary's Urgings

Reuters stands by the accuracy of its report according to a spokesperson. Based on the report, Sebelius wrote that breast cancer is the second-most-common type of cancer among women, affecting one in eight women in the U.S. in their lifetime.

"WellPoint should not wait to end the unconscionable practice of deliberately working to deny health insurance coverage to women diagnosed with breast cancer," Sebelius stated in her missive. "I urge you to immediately cease these practices and abandon your efforts to rescind health insurance coverage from patients who need it most."

The practice of rescission has been brought to the fore during the debate over health care reform, with a new law passed in March.