The Medical Freedom Channel

“Health insurers can’t wait until a policyholder is sick or injured to investigate the person’s medical history and then abruptly cancel the policy on the grounds that important information was left out of the original application, a state appeals court has ruled. On Monday, the Fourth District Court of Appeal in Santa Ana called a halt to a practice that lawyers for policyholders claim is widespread. Known as ‘post-claims underwriting,’ it has led to numerous lawsuits - mostly unsuccessful so far — and state enforcement actions against insurers. The court stopped short of a strict pro-consumer standard advocated by state regulators and plaintiffs’ lawyers. But the justices said health insurers can rescind policies after the fact, because of misinformation on the application, only by showing that they conducted a reasonable investigation before issuing the policy, or that the applicant deliberately lied.” [editor’s note: This might end up being one of the most important steps in the real healthcare reform process; deny the policy to begin with, or live with it when the claim comes in! - SAT] (12/26/07)