Blue Cross Of California

The state's largest for-profit health insurer is asking California physicians to look for conditions it can use to cancel their new patients' medical coverage. Blue Cross of California is sending physicians copies of health insurance applications filled out by new patients, along with a letter advising them that the company has a right to drop members who fail to disclose "material medical history," including "pre-existing pregnancies."

Facing a torrent of criticism Tuesday, Blue Cross of California abruptly halted its practice of asking physicians in a letter to look for medical conditions that could be used to cancel patients' insurance coverage. In a statement issued about 6 p.m.

Anthem Blue Cross and Blue Shield -- two of the state's biggest health plans -- agreed Thursday to pay a total of $13 million in fines and to offer new health coverage to more than 2,200 Californians the companies dropped after they became ill. Neither company admitted to any wrongdoing in agreeing to pay the stiffest penalties yet in efforts by state authorities to curb what they view as an abusive practice of investigating and canceling policies after policyholders run up big medical bills.

Blue Cross of California "routinely" violated state law when it canceled individual health insurance coverage after policyholders got pregnant or sick, making no attempt to determine whether they did anything to merit such "harsh" treatment, according to a state investigation of practices that appear to be industrywide.

The largest organizations representing California physicians and hospitals joined a lawsuit against Blue Cross of California on Thursday, accusing the state's largest health plan of illegally and routinely refusing to pay them millions of dollars for medical care provided to enrollees whose policies were later canceled.

Blue Cross of California agreed Thursday to stop canceling individual health coverage unless it can show policyholder deception -- a major shift by the state's largest health insurer that could lead to sweeping industrywide changes. The move is part of an effort to settle a class-action lawsuit on behalf of as many as 6,000 people canceled since late 2001.

State regulators are investigating whether a $950-million dividend Blue Cross of California sent to its Indianapolis-based parent violates an agreement the companies made to limit such payments to keep premiums down and maintain the quality of healthcare benefits, officials said Friday. Officials said the parent, healthcare giant WellPoint Inc., should have taken no more than $141 million out of California.

California has received more than 1,600 complaints from consumers, physicians and hospitals about Blue Cross of California since the state's largest health insurer was acquired by an Indiana firm in 2004, officials said Tuesday. The state announced plans this week to hold a public hearing in Los Angeles on July 19 on how well Blue Cross has lived up to promises it made nearly three years ago as part of the $21-billion acquisition.

State regulators Monday postponed a hearing originally set for this week on complaints against Blue Cross of California, because its parent company has requested a more detailed agenda. The hearing now is set for Aug. 7 in Los Angeles. The state Department of Managed Health Care, which oversees HMOs, said last week that it had received more than 1,600 complaints from policyholders and doctors in less than three years against Blue Cross, the state's largest health insurer.

Blue Cross of California's latest antidote to rising healthcare costs isn't going down very well with physicians. The state's largest for-profit health plan is set to roll back its payments for about half the services and procedures provided by physicians next month. And many of the 53,408 physicians in Blue Cross' preferred provider organization (PPO) networks say that's a prescription for disaster. Doctors say the health plan imposed the new rates unilaterally.