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> Return to Letters of Reprimand July 17, 2002 Stephanie Valadez Re: Letter of Reprimand
Failure to suspend Medicare Supplement policy at request of Medicaid eligible enrollee as required by Bureau of Insurance Rule Chapter 275
Please accept this as a formal Letter of Reprimand from the Superintendent of the Maine Bureau of Insurance. The purpose of the letter is to address violations of the Maine Insurance Rule Chapter 275 as set forth below. 1. The Bureau received a complaint from the Eastern Agency on Aging on behalf of one of their constituents, complaint # 200517738, stating in part: [Consumer] was … eligible for total medical coverage under the community Medicaid program… We called Conseco to ask to have her Medicare Supplement policy suspended as she was not covered by Medicaid. We called them 9/27/01, 10/11/01, 11/16/01, 12/4/01/ 1/28/02, 2/4/02 3/14/02 all in an effort to get Conseco to suspend the policy not terminate it as they insisted was the only course of action open to [Consumer]. We sent them a letter dated 10/11/2001, very articulately asking them to suspend the policy, and also enclosed proof of her Medicaid eligibility. I have recently become eligible for the State of Maine's Community Medicaid program. My eligibility started 8-01-01. I have enclosed a letter to verify this. I understand that I am allowed to suspend my health insurance coverage for twenty-four months starting with the month of Medicaid eligibility. Please suspend my Conseco Med Sup health insurance coverage. Please refund any premiums paid since the date of eligibility. 2. Bureau of Insurance Rule Chapter 275(8)(A)(7) provides in part: a. A Medicare supplement policy or certificate shall provide that benefits and premiums under the policy or certificate shall be suspended at the request of the policyholder or certificateholder for the period (not to exceed twenty-four (24) months) in which the policyholder or certificateholder has applied for and is determined to be entitled to medical assistance under Title XIX of the Social Security Act, but only if the policyholder or certificateholder notifies the issuer of such policy or certificate within ninety (90) days after the date the individual is notified that he or she is entitled to such assistance. b. If suspension occurs and if the policyholder or certificateholder loses entitlement to medical assistance, such policy or certificate shall be automatically reinstituted (effective as of the date of termination of such entitlement) if the policyholder or certificateholder provides notice of loss of entitlement within ninety (90) days after the date he or she is notified of loss, and pays the premium attributable to the period for which coverage is restored. 3. Conseco's April 1, 2002 response to the Bureau acknowledged that the insured was misinformed when she was told she couldn't suspend her Medicare Supplement coverage while she was eligible for Medicaid. As described in paragraphs 1- 3 above, Conseco violated Rule 275(8)(A)(7) by failing to suspend the Medicare Supplement policy at the request of a Medicaid eligible insured. The Bureau acknowledges that Conseco has provided the Bureau with a copy of a February, 2002 memorandum of procedures for its customer representatives to follow when a request to suspend a Medicaid eligible enrollee's policy is received, and that those procedures are appropriate. The Bureau requests written confirmation within 30 days that: a. Appropriate follow up training has been undertaken to ensure that similar violations do not reoccur.
b. Conseco has conducted a thorough review to determine if any other Medicaid eligible enrollees have been advised that they are not entitled to suspend their Medicare Supplement policies. Conseco should document that any enrollees so identified have been advised of their rights under Maine law. In addition, Conseco should document that appropriate steps have been taken to address any harm to consumer attributable to receipt of incorrect information. _____________________________ By his designee: ___________________________ Last Updated: October 28, 2008 |
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