State fines Blue Cross of California $1 million

Published on:
26 March 2007 at 05:11 a.m. ET

Written by: Unknown Author –

http://www.insidearm.com/news/00000088-state-fines-blue-cross-of-california-1-mi/

Department of Managed Health Care has fined Blue Cross of California $1 million for violating state law by systematically dropping policyholders after they became sick or pregnant. Blue Cross of California is the largest health insurer in the state.

The Department said that an investigation discovered Blue Cross used computer programs and a dedicated department to rescind the policies of pregnant women and the chronically ill regardless of whether they intentionally lied on their applications. According to state law, in order for an insurer to drop an individual’s coverage, they must prove the individual had lied on their application.

Blue Cross is disputing the findings.