Health insurance termination

[dss8]

What is the name of your state (only U.S. law)? NY

This is a two-part question and it relates to both employment law and maybe -medical malpractice?? We had our family's health insurance through my husband's employer. The employer switched to a new health plan 08/01/2010 and everyone got their new cards, etc. A month later, in September 2010, the said employer went bankrupt and closed the shop. Around the same time, bills started coming in from the medical providers, used in August. Apparently our coverage had been retroactively terminated, effective 08/01/2010 because the employer failed to pay the insurance policy. All our August claims were rejected and we are responsible for full amounts of every medical service bill. I am a cancer patient, many procedures required pre-certification or notification of the insurance company. Nobody - neither the employer, nor the hospital, nor the insurance company ever alerted us that we had no coverage at the time of service. I have A LOT of bills which I'd rather not have to pay. Who is the responsible party here? The employer for not paying the policy and not warning the employees? The hospital for administering the services without telling us that we have no coverage and would be responsible for the full amount? The insurance company? I mean, they are all kind of shrugging their shoulders and we are getting screwed. Any ideas on how to proceed? Many thanks, DSSWhat is the name of your state (only U.S. law)?

 

[lealea1005]

What is the name of your state (only U.S. law)? NY

This is a two-part question and it relates to both employment law and maybe -medical malpractice?? We had our family's health insurance through my husband's employer. The employer switched to a new health plan 08/01/2010 and everyone got their new cards, etc. A month later, in September 2010, the said employer went bankrupt and closed the shop. Around the same time, bills started coming in from the medical providers, used in August. Apparently our coverage had been retroactively terminated, effective 08/01/2010 because the employer failed to pay the insurance policy. All our August claims were rejected and we are responsible for full amounts of every medical service bill. I am a cancer patient, many procedures required pre-certification or notification of the insurance company. Nobody - neither the employer, nor the hospital, nor the insurance company ever alerted us that we had no coverage at the time of service. I have A LOT of bills which I'd rather not have to pay. Who is the responsible party here? The employer for not paying the policy and not warning the employees? The hospital for administering the services without telling us that we have no coverage and would be responsible for the full amount? The insurance company? I mean, they are all kind of shrugging their shoulders and we are getting screwed. Any ideas on how to proceed? Many thanks, DSSWhat is the name of your state (only U.S. law)?

You are ultimately responsible to pay the bills. I'm 99% sure the registration forms you signed included a paragraph addressing your responsibility for payment of any fees not covered or refused by your insurance company.

How is this even remotely malpractice?

 

[dss8]

to lealea1005

I get it, I get it - of course one signs the paperwork taking the responsibility for the payments. And the "malpractice" part was ill-chosen, just because I didn't see any other appropriate health-related forum topic. But that's not the point of my question. The question is - how is it that neither of the participating parties is in any way responsible for this outcome? I mean, the hospital did have to call the insurance company upong the admission, did they not? And the insurance company did have to give their approval for a particular test/treatment? And of course, the company that failed to pay its share of the insurance policy - how is it that everyone gets to walk away? So, while there certainly is that paragraph about the patient's ultimate financial responsibility, it should not serve as a blank check ("I will pay for everything, even if everyone fails to do their jobs").

 

[ecmst12]

The only person who didn't do their job was the employer who didn't pay the bill. Your coverage was termed RETROACTIVELY.

 

[lealea1005]

The only person who didn't do their job was the employer who didn't pay the bill. Your coverage was termed RETROACTIVELY.

Agreed. Unfortunately, this happens once in a while. There may have been a communication delay between the accounts receivable and provider services departments. The hospital (provider) probably did call and receive verification of coverage on the date(s)of service. How are they to know that the information given to them is incorrect? Why should the hospital have to be penalized by not being paid for the services they provided to you?

It's an unfortunate situation, but it does not relieve you of the responsibility to pay the amount. You may want to contact the hospital's accounts payable department to see whether they would be willing to discount the amount down to what the insurance company would have paid if you were covered. They are under no obligation to do so ut it's certainly worth a try.

Good luck.

 

[cbg]

I can pretty much guarantee, having been on both sides of the desk more than once on this issue (yes, the clerk who did not pay the bill was fired), that if the check was due on August 1, it was no earlier than 9-30 before the policy was cancelled, and quite possibly as late as 10-15 or even 10-22. If the hospital verified coverage any time prior to that, they would be told the coverage was in place. Even in the event of a bankrupcy, cancellations of coverage are almost always done retroactively and for several weeks back.

So it's not that no one told you that there was no coverage in place; there was coverage in place at the time of service. It's simply that it was cancelled retroactively. Shame on the employer for not paying the bill, but that's not the hospital's fault.

 

[CourtClerk]

And I'll add one more thing...

even if the employer is at fault, the employer has filed for bankruptcy protection, so you still have no where to go. Pay the bills for your treatment.