Posted on 10/15/2009 12:43:13 PM PDT by pabianice
In the state of New York, insurers are legally prohibited from discriminating against individuals who submit large claims. So when Guardian, a major insurance company, was faced with the high-cost claims of 37 year-old muscular dystrophy patient Ian Pearl, it decided to cancel its entire line of coverage in the state of New York rather than pay for Pearl’s claims. In an e-mail obtained by The Washington Times, it was revealed that one executive at the company refers to patients like Pearl as “dogs” that the company can simply “get rid of”:
Legally barred from discriminating against individuals who submit large claims, the New York-based insurer simply canceled lines of coverage altogether in entire states to avoid paying high-cost claims like Mr. Pearl’s. In an e-mail, one Guardian Life Insurance Co. executive called high-cost patients such as Mr. Pearl “dogs” that the company could “get rid of.”
A federal court quickly ruled that the company’s actions were legal, so on Dec. 1, barring an order by the federal Department of Health and Human Services, Mr. Pearl will lose his benefits.
The cost of Pearl’s annual treatment is approximately $1 million a year. The Pearl family is unable to receive the quality health care that Ian needs. “One-on-one skilled nursing is essential,” Mrs. Pearl said.
Would some of them wish to take up a collection for the poor fellow?
That’s pretty drastic, to pull the rug out from under all subscribers who must now scramble anew for different coverage on the merits of their current conditions rather than what they were when they signed up. This “dog” hurt a lot of cats too.
I wonder if I have saved enough money and want to retire early, will I be allowed to.
If I stop working and pay less tax, won’t a lot of children starve ?
So tell us again how an insurance company should be able to sell coverage and then cancel it when things don't go as well as planned. It's akin to Goldman making billions and then going to the government to bail out its poor risk management.
That's nearly $3000 PER DAY.
Someone's making a pile of money on that one.
Sounds like par for a hospital today, sadly.
Home care with a dedicated nurse would be cheaper.
Well, most policies have a lifetime coverage limit. It would seem the insurance company didn't want to have to wait for that to happen.
Tell me how this would be different than a hurricane hitting Florida and companies cancelling coverage during reconstruction and refusing to honor all outstanding claims. I'm getting tired of businesses with poor risk management engaging in these kind of stunts.
EXACTLY That seems to be a little high
The usual thing that this situation is called is bankruptcy.
So one policy holder can bankrupt a company? Cut me a break.
Looking at the costs this sounds like a pretty stupid situation. The company might be able to cut this St. Bernard down to a Chihuahua if it supported dedicated home health care in lieu of an institution, but I wonder if the state insurance rules don’t let it do that!
Directive 10-289
“In the name of the general welfare,” read Wesley Mouch, “to protect the people’s security, to achieve full equality and total stability, it is decreed for the duration of the national emergency that—
“Point One. All workers, wage earners and employees of any kind whatsoever shall henceforth be attached to their jobs and shall not leave nor be dismissed nor change employment, under penalty of a term in jail. The penalty shall be determined by the Unification Board, such Board to be appointed by the Bureau of Economic Planning and National Resources...
Given the state in question is New York, that's quite possible. But even then, at some point, the patient would reach a lifetime limit, it would just be a matter of how long it would take.
I'm getting sick of corporations raking in the profits but turning around and screwing customers or the taxpayers when things go south. They want a sure thing at the expense of others, which is not capitalism as I know it. If you make a mistake, you should pay.
Instead of socializing medicine....just make the insurance policies “contracts”....insurance companies need to start taking the risk...and stop reneging on deals that they made
Whatever happened, it is clear that the company calculated that such drastic action was the best course of action, at least from a cost-control viewpoint. Completely shutting down a line of business in one of the largest states of the union is not something they would do if they had a choice. They must be constrained by state regulations and other factors (perhaps there is no cap allowed on expenditures for a patient in NY?)
One could imagine they are 'sending a message' to protest unfair regulations, but I doubt they would do that just as an emotional measure. Not where $$ is at stake.
Pretty convenient for this “story” about evil
insurance companies to surface at this time.
Here’s the link to the Washington Times article
so you won’t need to be decontaminated after
visiting Democratic Underground.
1. Prove it costs $1mil a year for this patient.
2. Name the exec and produce the “dog” email or shut up.
3. The government has called us far worse for demanding government accountability.
4. The court said the actions of the insurer legal.
(Corrected paragraph:) A Guardian spokesman said policies such as Mr. Pearl’s - which offered unlimited home nursing - had simply become too expensive for new small-business customers to buy, and that even Medicaid and Medicare do not cover 24-hour home nursing. His parents, Warren and Susan Pearl of Fort Lauderdale, Fla., said their health insurance premiums had risen over the years to $3,700 a month.
LINK TO WASHINGTON TIMES ARTICLE
There are forms of meta-insurance called catastrophic bonds, or cat bonds. They are intended to help cover the 0.01% chance situation where the liability exceeds the company assets. Normally this is for situations like large weather disasters, but it could handle situations like this too. One cat bond fund might have cat bonds for multiple insurance companies.
Not too bad considering the patient's costs were $3,000 a day! Sounds like a deal!
Were they treating this guy with three ounces of 24K gold daily? This number sounds way out of line.
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