Health Insurance Company Seeks Spies

Brooks Schuelke

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Unbelievably, Blue Cross of California had a policy of using its customers' doctors as spies to cancel coverage. The Los Angeles Times broke the story this week:

The state's largest for-profit health insurer is asking California physicians to look for conditions it can use to cancel their new patients' medical coverage.

Blue Cross of California is sending physicians copies of health insurance applications filled out by new patients, along with a letter advising them that the company has a right to drop members who fail to disclose "material medical history," including "pre-existing pregnancies."
"Any condition not listed on the application that is discovered to be pre-existing should be reported to Blue Cross immediately," the letters say.

The story was met with outrage from both politicians and doctors. The story continues:

"We're outraged that they are asking doctors to violate the sacred trust of patients to rat them out for medical information that patients would expect their doctors to handle with the utmost secrecy and confidentiality," said Dr. Richard Frankenstein, president of the California Medical Assn.

Fortunately, after the outrage, Blue Cross announced that they were halting the practice. But reading the article, I don't get the impression that Blue Cross is sorry they did it. One Blue Cross spokeswoman defended the practice, noting that they had been sending out thousands of these letters per month for quite some time without receiving any objections.

I commend the Los Angeles Times for this good work that helped stop this outrageous practice. I just wonder whether Blue Cross engages in the practice here in Texas.