From a TPMDC report, here is the story. In the new health law, the policy on rescissions take effect in six months within the enactment of the law. However, Democrats want private insurers to voluntarily stop dropping sick Americans off their rolls now:
In a letter obtained by TPMDC, the committee chairs and subcommittee chairs of the three house committees dealing with health reform are calling on seven big insurance companies -- WellPoint, Kaiser Permanente, Assurant, United Health, Humana, Blue Cross and Aetna -- to take the step to keep sick people insured on their own.
"These rescissions hurt patients who need coverage the most, such as women diagnosed with breast cancer," the letter reads. "We are writing to ask all of your companies to end any such abusive practices immediately."
Here's more on this story below the jump along with their request in asking private insurers "to create a third party board that would review all recissions for evidence of "fraud or material misrepresentation" on the part of the insurance."
I don't know about asking private insurers to create their own third party board, and it kind of strikes me as the equivalent of asking the fox to put someone in charge of watching the hen coop. In any case, here's their letter below, and you can click to see the full text of their letter:
Dear Madam and Sirs:
Last week, most of your companies announced plans to implement ahead of schedule the provision in the health reform law allowing individuals up to age 26 to obtain coverage through their parents' health insurance. This step will help many bridge the gap between graduation and the effective date of this requirement. This decision signals that you are willing to work to make health insurance more accessible and affordable. We commend you for this step.
Also last week, Secretary Sebelius, reacting to recent media reports, wrote to Ms. Braly asking that WellPoint immediately end its efforts to rescind health insurance coverage except in cases of fraud or intentional misrepresentation of material fact. These rescissions hurt patients who need coverage the most, such as women diagnosed with breast cancer. We are writing to ask all of your companies to end any such abusive practices immediately.
In addition, to ensure that rescissions occur only in cases of fraud or intentional misrepresentation of material fact, we request that each of your companies immediately institute a policy of independent, external third party review. Under such a procedure, no individual health insurance policy should be rescinded until the review confirms that fraud or material misrepresentation has in fact occurred.
Taking these actions now would be consistent with your earlier decision to implement consumer protections for individuals under 26 voluntarily and would further demonstrate a commitment to reliable coverage for your policyholders.
We'll see if private insurers will comply with the request by Democrats, and what kind of a third party board they set up to review pending rescissions based on "fraud or material misrepresentation." This should get interesting, folks.
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