Tennesseee Health Care Campaign (THCC)

Working for guaranteed affordable choices

No more rescissions! Insurers can no longer unfairly cancel your policy.

Posted by Beth Uselton on September 24, 2010

Starting today, Tennesseans with health insurance have added security that the coverage and benefits they’ve paid for will be there if they face a catastrophic illness or injury. Starting September 23, 2010 health insurance companies can no longer drop your policy or retroactively cancel it if you get sick. The term for this practice is rescission and it’s now a thing of the past!

Before the Patient Protection and Affordable Care Act was signed into law, insurers could use loopholes or inadvertent omissions in people’s paperwork to justify rescinding their policy when they actually tried to use the benefits they paid for. This unfair practice usually happened when a policyholder needed expensive care. Before health reform, your insurance company could find and use very common paperwork mistakes (like forgetting to list on your application a prescription you took 10 years ago) to cancel your insurance and demand that you pay back money for medical bills they covered in the past.

Rescissions blindside patients, often leaving them in the terrible position of being uninsured, uninsurable (due to what would often be labeled a pre-existing medical condition by other insurers) and facing medical debt for bills they thought would be paid by the insurance company that dropped them. Starting today, the new health reform law prohibits insurers of new and renewing plans from rescinding coverage except in cases of intentional fraud. Also, Insurers seeking to rescind coverage must provide at least 30 days advance notice to give patients time to appeal.

Insurance companies spent over $500 million dollars opposing health care reform because they knew it would hold them accountable. The new law does just that by banning them from dropping coverage for people just when they need it most. To find out more about the new health care law, visit our Health Reform Hub at http://www.thcc2.org

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