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 The statement said fewer than 0.1% of individual members' policies were rescinded in 2009.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 16,643.01 -11.76 -0.07%
Nasdaq 4,828.33 15.62 0.32%
S&P 500 1,988.87 1.21 0.06%
Treasuries 2.19 0.02 0.83%
Data as of 2:36pm ET
Company Price Change % Change
Freeport-McMoRan Inc... 10.50 0.31 3.04%
Bank of America Corp... 16.36 -0.08 -0.49%
Apple Inc 113.29 0.37 0.33%
Intel Corp 28.42 0.70 2.53%
Alcoa Inc 9.41 0.55 6.21%
Data as of Aug 28
Sponsors

Sections

Efforts to unionize low-wage employees of fast-food franchisees and outside contractors get lift from decision of NLRB. More

The U.S. economy has performed well this year. But there's lots of global gloom. Which will influence the Fed the most? More

The market volatility in China and the U.S. could hit private companies, especially late-stage unicorns. More

How do you run a successful crowdfunding campaign? Indiegogo's CEO Slava Rubin offers his top tips and mistakes to avoid. More

Looking for something good on Netflix? These entertaining films will help you learn more about finance and investing. More