Aetna allows independent physician panel to review rescissions

Starting on Thursday, Aetna will let an independent panel of physicians decide whether to rescind health insurance policies for sick plan members suspected of submitting false or incomplete information on their applications, the Los Angeles Times reports.

The move comes amid recent scrutiny of alleged inappropriate policy rescissions in several states. In California, state regulators have won more than $20 million in settlements with five insurers over the practice, and Congress in July began an investigation into rescissions (Los Angeles Times, 9/23). Regulators in California, Connecticut and other states say some companies have used retroactive policy rescissions as a way to avoid paying costly medical bills when a plan member gets sick (Levick, Hartford Courant, 9/23).

Aetna spokesperson Mohit Ghose said no regulatory action has been taken against Aetna (Los Angeles Times, 9/23). According to Ghose, Aetna has rescinded 165 of 570,000 individual policies it sold in the U.S. since 2005 (Hartford Courant, 9/23). Aetna CEO Ron Williams said, "This issue has generated much public attention for our industry, and we want to address it head on," adding, "We want to go the extra mile when it comes to the tough decision of rescinding the few policies we must." Aetna has hired MCMC, an independent review company, to perform more than 40,000 reviews of medical bills and services annually. Williams said, "This nationwide independent review process should give consumers enhanced peace of mind that they will always be treated fairly and have access to a process independent of Aetna" (Los Angeles Times, 9/23).

Proposed policy rescissions will be reviewed by a panel of three independent physicians, whose decisions will be binding for Aetna. Members who want to appeal the rescissions will have the option of going through Aetna's internal appeals process or going directly to the MCMC panel. People who appeal to the panel still will be able to appeal directly to the company. Vicki Veltri, general counsel in Connecticut's Office of the Healthcare Advocate, said, "It is a very good development for consumers to have these options," adding, "Aetna is definitely ahead of the curve on this issue" (Hartford Courant, 9/23).

According to Darrel Ng, a California Department of Insurance spokesperson, Aetna is the first health insurer in the nation to set up binding independent reviews in every state where they do business. He added that all insurers in California eventually will be required to hold independent reviews of policy cancellations (Los Angeles Times, 9/23).