Health insurer settles with NYS on denied claims

EmblemHealth Inc., a health insurance company based in New York City, will pay $190,000 in denied claims and a civil penalty in a settlement recently announced by state Attorney General Eric T. Schneiderman.

The company, which covers 3.4 million New Yorkers through its Group Health Inc. and Health Insurance Plan of Greater New York units, also agreed to offer to reinstate health coverage to more than 8,000 young adults whose coverage was wrongly terminated, Schneiderman announced.

The settlement followed an investigation by the attorney general”™s health care bureau that uncovered widespread violations of New York”™s Age 29 Law, which requires insurers to offer continuation of health coverage to children of plan members until they turn 30. The state”™s 5-year-old law extends the period of a child”™s coverage allowed by the federal Affordable Care Act, which provides that parents can keep a child on their family health policy until the age of 26.

Investigators found Emblem failed to send required letters to more than 8,000 Emblem members between 2010 and 2012. Nearly 1,000 of those members were never notified that their coverage had been terminated, Schneiderman said.

Emblem agreed to pay approximately $90,000 in unreimbursed medical costs to 105 plan members who were not notified of the Age 29 law.

The attorney general noted that young adults comprise about one-fourth of New York”™s uninsured population. “This settlement sends a message to insurance companies that want to do business in New York: Providing health coverage to New Yorkers also means playing by the rules and following the laws of our state, which are often stronger than federal regulations,” he said.

Under the settlement, EmblemHealth will also submit to monitoring and an independent audit and will pay $100,000 to the attorney general”™s office as a civil penalty.