That's Gotta Hurt

We had decent experiences with our medical insurance provider, United Healthcare, until it acquired PacifiCare over two years ago. Whether it was due to UHC’s turning over administration of California patients to PacifiCare is unclear, but claims that had been paid the previous year for the same service under the same policy were inexplicably stonewalled and denied.

One item rankles in particular. My doctor and I have been communicating with UHC over payment of $830 for allergy skin tests conducted in 2006. The phone call became a ritual: the UHC customer service representative would say everything appeared to be in order; the CSR would even submit it for “special handling”. A few weeks later we would get a form letter denial with the helpful explanation, “This claim was processed according to the patient’s benefit plan.”

Last month my doctor’s bookkeeper called us about the 18-month-old receivable. Legally, we were responsible for the charges, so I settled it with her at 80% of the amount. I thought about a small claims action against United Healthcare, but the cost of organizing the documents and notes of my phone calls, plus taking time off, just wasn’t worth the benefit of having my day in court.

Nevertheless, I did get emotional satisfaction when my employer moved most of its 2,000 employees from UHC at the end of last year and from this item:

In January, California regulators said they planned to seek fines potentially exceeding $1 billion against UnitedHealth for alleged mishandling of claims and data at PacifiCare, including "unfair" pre-existing condition denials and a "meltdown in its claims paying process."

$1 billion isn’t what it used to be, but that’s gotta hurt. © 2008 Stephen Yuen