Insurance News November 16th

Arizona: Regulators Fine Pair of Aetna Insurers

Arizona Insurance Director Christina Urias reports that the department is imposing civil fines totaling $256,000 on a pair of Aetna insurers for multiple violations that reportedly include failing to provide information to policyholders on appeal rights and outcomes.

Aetna Life Insurance Co. and Aetna Health Inc. are not contesting the fines imposed under consent orders announced by the Department of Insurance, and Aetna said it will implement corrective action plans.

According to the DOI, the orders stem from reviews of the companies' practices related to appeals, emergency claims, timely payment of health care providers' claims and grievances between 2004 and 2006.

Urias stated the violations directly affected consumers and care providers.

California: DOI Unveils Online PPO Rating Report Card

California Insurance Commissioner Steve Poizner announced the launch of a new report card on the Department of Insurance's Web site (www.insurance.ca.gov) that will allow consumers to make more informed choices about which Preferred Provider Organization (PPO) is best for them, and will allow everyone to monitor how well the health care system is doing in assuring the right care is given to the right patients.

"Consumers need the best possible information and transparency when choosing their health insurance provider," said Poizner. "This report card will provide information that has been lacking for too many years. It is based on a four-star rating system that is easy to understand, yet gives consumers the ability to dig deeper and find how well each insurer does on dozens of specific best practices. The report card provides a one-stop shopping experience for California's major PPO providers."

While other states collect similar data, Poizner said California is the only state to analyze it, and offer it in a consumer-friendly, interactive format that includes summary ratings as well as the more detailed underlying measurements.

The ratings are based on a set of standard measures developed by the National Committee on Quality Assurance. In addition to grades based on the clinical best practices, the report also includes results of a voluntary survey completed by plan members related to consumer satisfaction.

Florida: Consumer Can't Sue Auto Insurer for Failing to Detail PIP Claim Explanation

County courts will no longer have to deal with unnecessary and unjustified lawsuits following a ruling from the 3rd District Court of Appeals this month.

A three-judge panel ruled that a person couldn't sue his or her auto insurer for failing to provide an explanation of benefits on personal injury protection claim.

"The result of the court's opinion will likely be a decrease in frivolous lawsuits filed solely for the purpose of obtaining attorney's fees from the insurance company," said Thomas Hunker, staff attorney in the appellate division of the office of the general counsel of United Automobile Insurance Company. "It will also simplify the personal injury protection litigation process and get the focus back on whether the bills were due and owing."

An auto insurer can challenge a payment claim after the 30-day period, the court said, and the court has "never located in the statute any absolute deadline on such a challenge."

The appeals court went a step further and ruled that policyholders cannot sue their insurer for not providing an explanation of benefits on a medical claim. "In fact, the statute only authorizes one cause of action: a cause of action for personal injury protection benefits," the appeals court wrote.

"Personal injury plaintiffs can still sue insurance companies for bad faith under the bad faith statute," Hunker added, "but they will have to give the insurer notice and a fair chance to cure any alleged defect."

Michigan: State Senators Puts Brakes on Auto Insurance Reform Bill

State Senators recently voted down a bill (21-14) to streamline the price setting of auto insurance premiums.

The bill would have banned insurers from determining rates based on risky regions, such as urban areas that see a high rate of vehicle theft.

Among those voting against the bill was State Senator Roger Kahn, a Saginaw Township Republican. Kahn noted that consumers living in the Saginaw County area would be forced to pay between 17-24 percent more in their premiums.

According to Kahn, it would be unfair for the consumers he represents to subsidize the premiums of drivers residing in high risk areas.

Bill sponsor Martha Scott (D-Highland Park) said that the Republican defeat of her bill to prohibit the use of territories when setting auto and homeowner insurance rates was a slap in the face to all the hard-working citizens of Michigan who pay unfair, exorbitant insurance rates.

"If we are going to require that every driver carry auto insurance then we need to make sure that the rates they are charged are fair, and right now these rates are anything but fair,' Scott said. "Insurance rates should be based on the car a person drives, that person's driving record, and the distance that person regularly drives. If we adopted these common sense changes to our auto insurance laws then we would no longer pay the 12th highest rates in the country, and our citizens living in our metro/urban areas would no longer pay the highest rates in the country. My bill may have gone down to defeat but I will continue calling for auto insurance reform and fair rates for everyone.'

Wisconsin: OCI Reminds Consumers to Check Auto Policy Coverage

Deer hunting season is approaching and the Office of the Commissioner of Insurance reminds consumers to review their auto insurance policy to make sure they have coverage for deer hits.

"This is the time of year that the deer are on the move and running onto roads," said Wisconsin Insurance Commissioner Sean Dilweg. "If you don't have the proper auto coverage in place and you hit a deer, you'll be faced with a large repair bill, or worse, a totaled vehicle with no coverage."

Deer hits and other auto-animal collisions are covered under the comprehensive coverage of an auto policy, sometimes referred to as "other than collision." This optional coverage is found in the section entitled "Coverage for Damage to Your Auto." Comprehensive coverage provides financial protection beyond that of collision coverage, including hail, theft, falling objects, and deer hits.

Drivers should call their agent and check their policies to see if they have comprehensive auto coverage.