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Best’s News & Research Service - September 16, 2016 04:08 PM (EDT)

North Carolina Fines Blue Cross Blue Shield $3.6 Million in Consumer Complaint Settlement

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RALEIGH, N.C. //BestWire// - Blue Cross and Blue Shield of North Carolina was fined $3.6 million — the largest in state history — as part of a voluntary settlement agreement with the Department of Insurance to end an ongoing consumer complaint investigation.

The fine will come from Blue Cross and Blue Shield of North Carolina surplus and as a result will not result in higher customer premiums, according to the department. “This is the largest fine the North Carolina Department of Insurance has ever levied and almost double the previous largest amount against a single company,” the department said. The agreement said the company already has made $11.3 million in restitution to policyholders and paid $8.3 million in interest payments on claims to health providers.

The agreement ends a dispute, which began seven months ago when the department began an examination of the insurer after it had received numerous customer complaints regarding problems with enrollment and payment (Best’s News Service, Feb. 11, 2016).

Blue Cross Blue Shield of North Carolina denied it violated any state law or regulations and entered the agreement “in order to compromise disputed allegations and to avoid the uncertainty, distractions and expense of litigation.” The company did acknowledge in some instances it failed to timely provide identification cards, committed errors in invoices and billing and did not respond to the department on timely basis in early 2016 due to technology failures.

“We have been actively addressing these issues, and expect to be stronger as a result of this process,” a company statement said. “We remain committed to our customers and the communities of North Carolina and we are deeply sorry for the challenge that this created for our customers and providers.”

The department earlier this year said the difficulties in question involved the company’s attempt to transfer to a new information technology system during the open enrollment period for the state health insurance exchange. Problems with the new system included being unable to verify whether coverage was in effect to being accidentally double-billed by the company.

(By Thomas Harman, Washington Bureau manager, BestWeek: Tom.Harman@ambest.com)



Settlements (Litigation) Consumer Complaints North Carolina State Regulation Investigations


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