"BEST HEALTH CARE IN THE WORLD"

(Via Atrios)

Health insurers can no longer collect premiums on polcies they think are invalid, according to a California Appeals Court. It seems the Blue Cross made a habit of collecting premiums from suspect policies, then cancelled them when the hospital bills came rolling in. In this case below, the rescission by Blue Cross left Steve Hailey permanently dependent on a catheter.

Court curbs insurers' ability to rescind medical policies

A ruling restricts the ability of California health plans to cancel coverage after patients run up medical bills.
By Lisa Girion, Los Angeles Times Staff Writer
December 25, 2007

"These facts raise the specter that Blue Shield does not immediately rescind health care contracts upon learning of potential grounds for rescission, but waits until after the claims submitted under that contract exceed the monthly premiums being collected," the court wrote.

A health plan, the court went on, "may not adopt a 'wait and see' attitude after learning of facts justifying rescission." The court said companies could not continue to "collect premiums while keeping open its rescission option if the subscriber later experiences a serious accident or illness that generates large medical expenses."