Blue Cross of California agreed to settle more than 70 lawsuits and claims filed by former members who accused the states largest health insurer of illegally canceling their policies after they got sick. The value of the settlements was not disclosed. A lawyer for the plaintiffs said his clients would receive enough to cover the thousands of dollars in medical bills with which they were left after having their coverage retroactively rescinded. In September, state regulators fined the Blue Cross plan $200,000 for improperly revoking a Southern California womans policy. Shortly before the fine was announced, the insurer said it would clarify its policies for rescinding coverage, simplify its application form, revise its appeals process and establish an ombudsman to communicate with members on cancellation issues. California law prohibits retroactive cancellations unless there is evidence a member lied when applying for coverage or intentionally failed to disclose information. California Blue Cross has maintained that the vast majority of its cancellations were proper. The California Department of Managed Health Care is investigating at least two other insurers, Blue Shield of California and Kaiser Permanente, for similar alleged violations. -- by Laura B. Benko
Calif. plan settles with former members
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