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Friday, September 12, 2008  

Health Insurance Companies Pay Millions for Dropping Consumers

It's been a tough year for health insurance companies, especially in California. And it just got tougher now that Health Net has agreed to pay $25 million dollars for dropping the coverage of over 1,000 sick patients.

Health Net has definitely been in the news lately, though they're one of many health insurance companies who are being criticized for the practice known as "rescission."

"Rescission" is the industry's term for the practice of dropping patients from their policy when they get sick and try to make claims on their insurance policies. In Health Net's case, The San Francisco Chronicle reports that the insurance giant must offer new coverage to 926 customers who were dropped since 2004.

They've also agreed to repay $14.2 million in outstanding medical expenses, and $7.2 million in insurance premiums.

Earlier this year Health Net was also ordered to pay $9.4 million for dropping the coverage of a hairdresser in Lakewood whose policy was canceled when she was undergoing chemotherapy for breast cancer.

Clearly, it's getting very expensive to abuse consumers these days, which is a very good thing for those hard-working Americans who struggle to pay their insurance premiums every month.

Other health insurance companies who are under attack by the Los Angeles city attorney include Blue Shield of California, while Anthem Blue Cross and Blue Shield have already reached pricey agreements.

At least it's nice to know that while insurance costs may not be going down, at least in these cases the rights of the consumer are being defended from unfair practices.