Check insurance policy before you get sick


Wednesday, February 13th 2008, 5:29 pm
By: News 9


By Amanda Taylor, News9

Many of us have health insurance in case we get sick and require medical care.
But, be careful how you fill out your application when you get your policy.


Our Consumer Watch Team has found insurers are going back and canceling policy holders - retroactively.


Many of us have health insurance in case we get sick and require medical care.
But, be careful how you fill out your application when you get your policy.
Our Consumer Watch Team has found insurers are going back and canceling policy holders - retroactively.

Hairdresser Patsy Bates will never forget the day she went in for a routine checkup, and got devastating news -- she had breast cancer.

"I didn't know if I was going to live or die," Bates said. "I was scared."

Patsy underwent immediate surgery to remove the lump and part of her breast. She got pre-approval from her new insurance policy that became effective a month before.

"I was glad that I had insurance," she said.

But soon after the surgery, a letter from her insurer arrived in the mail. Her policy was rescinded. It was retroactively canceled leaving her with more than $100,000 in medical bills.

"There's nothing worse I don't think than an individual having something occur -- a health condition or whatever -- thinking they have insurance and finding out they don't," said Oklahoma Insurance Commisioner Kim Holland.

Holland said it's completely legal for insurers to revoke individual policies in cases of fraud and misleading or omitted information on an application.

It's very important that our consumers do respond truthfully to any question that is asked on an application.

"The insurer sometimes will want to go back and find out if there's any reason to believe that the patient knew about the condition before they bought the policy," said  Karen Pollitz, of the Georgetown Health Policy Institute.
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While the insurer didn't accuse Bates of knowing about her cancer, they did say she included her wrong weight and did not mention she had a pre-existing heart condition. Something she claims she didn't know, even though it was listed in several places in her medical records.

Her insurer refused an on-camera interview, but said, "issuing policies based on accurate information is the only way to ensure we can continue providing affordable, comprehensive coverage for our members."

"If you fail to disclose something that would have caused them to deny you

And the insurance industry says it relies on honesty and openness since there's no central place to obtain a person's medical history.

And while less than a half of a percent of all policies issued in Oklahoma are rescinded - some argue the practice is still being overused. Attorney William Shernoff has represented hundreds of clients whose policies were canceled.

"Ninety percent of the time, it's not a deliberate misrepresentation. It's just an innocent mistake or somebody can't remember what happened 10 or 15 years ago," said attorney William Shernoff.

And, application forms vary from company to company. That's why the commission is currently looking into a uniform application.

Get copies of your medical records periodically - and review them.  If there's an error get it fixed.

Typically, only individual health insurance polices that are rescinded.  Group plans offered by employers are generally not affected.

Amanda's blog about this story is located here.