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Los Angeles City Attorney, Rocky Delgadillo, filed suit against
Blue Cross for illegal business practices, misleading advertising and illegal insurance policy rescissions. Delgadillo says that the lawsuit is on behalf of 6,000 individuals whose benefits have been denied since 2002 and thousands of others whose benefits have been delayed due to Blue Cross’s practices.
Details of the lawsuit
According to press release on Delgadillo’s website, the lawsuit alleges that WellPoint, Anthem Blue Cross of California and Anthem Blue Cross Life engaged in unlawful and deceptive business practices that lead to the denying or delaying of authorization of thousands of health insurance claims or the canceling of cover after initially issuing a policy.
Specifically, the suit alleges that Blue Cross:
- Used false and misleading advertising to attract more than 500,000 customers
- Collected applications from customers using intentionally misleading forms with little or no meaningful review of the accuracy of responses or informed investigation into the medical history of applicants. The company would then retroactively review applications in order to find discrepancies.
- Employed and used untrained and unsupervised agents in completing customer applications – which further complicated the process
The lawsuit estimates that 6,000 individuals have had their benefits denied since 2002 and thousands of others have had their benefits delayed due to these practices. It seeks to have wrongfully denied policies reinstated, full restitution paid to victims and $2,500 for each penalty – which combined, could add up to nearly $1 billion.
Delgadillo fed up
Delgadillo seems to be fed up with insurance company practices in California. In a statement on his website, he says, “The health insurance industry is not focused on truly improving our care, lowering our costs or rooting out fraud. The industry’s singular focus is on maximizing profits – at the expense of patients and their doctors.”
This is the second lawsuit filed by Delgadillo against California’s large insurance companies in the past two months. In late February 2008, he filed a similar suit against Health Net for illegal business practices in the state and said that he was also launching a criminal probe into the insurer’s payment of bonuses to employees who find ways to cancel policyholders’ coverage.
Has your insurer acted in bad faith?
If you’ve been denied valid benefits by your insurance carrier or had your policy wrongfully canceled, contact an attorney to discuss your situation as the carrier’s practices could be considered bad faith. Consultations are free, without any obligation and are strictly confidential. To contact a qualified attorney, please click here. We may be able to help.
