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California investigates Aetna for denial of coverage

Aetna office building.
Aetna office building.
Via Flickr/ Montgomery County Planning Commission

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The California Department of Insurance announced Monday it's launching an investigation into the health insurer, Aetna.

This follows a former medical director for the company saying he personally did not review patient records before deciding whether or not to approve coverage. Instead, he relied on information from nurses before making that decision. That's how he was trained by the company, he said.

 This all came out as part of a lawsuit a young California man filed against Aetna for denial of coverage. CNN reported on it and then California Insurance Commissioner Dave Jones took action. 

"I directed the Department of Insurance to investigate Aetna's practices related to reviewing and denying requests for pre-authorization of treatment and requests for coverage of medical treatment," Commissioner Jones explained when he joined Take Two's A Martinez to talk about the new investigation.

Did Aetna violate any laws?

"California law is very clear that decisions with regard to coverage need to be made by medical professionals and be made by medical professionals that are licensed and who are at the appropriate level of skill and confidence to make the decision."

So, doesn't that include nurses? Or does it have to be doctors?

"In California, we have a number of levels of medical professionals. They all have different competencies, different levels of training, different levels at which they are licensed to make determinations."

The California Nurses Association says this case highlights "widespread abuse" within the insurance industry. Does that sound right to you?

"We routinely receive complaints from patients and medical providers about denials of coverage by health insurers. We have a process where we use independent medical professional physicians to review these denials. We encourage any patient or medical provider who has been denied coverage for treatment to contact us at 1-800-927-4357 to make a complaint. We will review the denial, and if it's a denial for lack of medical necessity by the health insurer, we'll submit that denial to our independent panel of physicians to review.

In approximately 50 percent of the cases that we received, we overturned the health insurer's denial..."

If your investigation reveals any wrongdoing on Aetna's part, what can you do to change policies and procedures so this doesn't continue happening, either with Aetna or any other insurer?

"The Department of Insurance and I as Insurance Commissioner have a number of remedies and sanctions available to us if we conclude that California laws have been violated. Those include penalties and also the capacity to order corrective action be taken. So, in many cases where we find wrongdoing, not only do we assess a penalty but we also require the health insurer to...make sure they don't violate the law again."