Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

WellPoint to stop canceling health policies

By Julianne Pepitone, staff reporter


NEW YORK (CNNMoney.com) -- Health insurer WellPoint will implement reforms preventing cancellation of policies except for incidents of fraud, effective May 1 - just one week after coming under fire for allegedly rescinding coverage of customers with breast cancer.

The recently enacted health care reform law disallows the cancellation of policies -- with the exception of cases of fraud or intentional misrepresentation -- starting Sept. 1.

The move came after an April 22 report from Reuters that said Indianapolis-based WellPoint "specifically targeted women with breast cancer for aggressive investigation with the intent to cancel their policies."

Later that day, WellPoint posted a response on its Web site calling the Reuters story "inaccurate and grossly misleading." The statement said fewer than 0.1% of individual members' policies were rescinded in 2009.

Health and Human Services Secretary Kathleen Sebelius sent WellPoint a letter on April 22 calling the alleged practice "disturbing," "deplorable" and "unconscionable."

In a response to Sebelius dated April 23, WellPoint chief executive Angela Braly said her company "does not single out women with breast cancer ... Period."

In its statement Wednesday, WellPoint said the so-called rescissions, "while rarely used, are one process for insurers to reduce fraud and protect members." The company did not return a call for further comment.

WellPoint (WLP, Fortune 500) is the largest company in the Blue Cross and Blue Shield Association. It is also the largest U.S. health plan, with more than 33 million medical members.  To top of page

Index Last Change % Change
Dow 17,852.23 146.18 0.83%
Nasdaq 4,889.11 28.05 0.58%
S&P 500 2,089.57 13.51 0.65%
Treasuries 1.87 0.01 0.48%
Data as of 3:01pm ET
Company Price Change % Change
Bank of America Corp... 14.99 0.31 2.11%
Chesapeake Energy Co... 4.34 0.29 7.28%
Hewlett Packard Ente... 17.33 1.08 6.65%
Freeport-McMoRan Inc... 11.69 0.58 5.22%
Apple Inc 99.52 1.62 1.65%
Data as of 2:46pm ET
Sponsors

Sections

As the Verizon workers' strike continues to drag on, shares of the telecom giant have lagged the broader market -- as well as top competitors AT&T and Comcast. More

Andrew Crider lost his welding business and his home when the real estate market crashed. Now the Nevada man is offended by comments Donald Trump made showing the billionaire rooted for the housing collapse. More

As the Verizon workers' strike continues to drag on, shares of the telecom giant have lagged the broader market -- as well as top competitors AT&T and Comcast. More