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Life Health > Health Insurance > Your Practice

Bay State Drops Request For Injunction Against Health Insurer

By Staff Writer

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A Texas company says its insurance subsidiaries can continue to sell coverage in Massachusetts.

The office of Massachusetts Attorney General Martha Coakley has dropped her request for a preliminary injunction against MEGA Life and Health Insurance Company and Mid-West National Life Insurance Company of Tennessee, units of HealthMarkets Inc., North Richland Hills, Texas, according to HealthMarkets.

When Massachusetts officials sued the companies in a state court in Boston in August, they argued that allegations of misrepresentation of MEGA and Mid-West limited-benefit health insurance products justified a request for an order preventing the companies from selling new policies in Massachusetts.

HealthMarkets has argued that the Massachusetts lawsuit is unfounded and unnecessary, and it has contended that new executives have introduced many new safeguards since they took over in 2003.

A judge is scheduled to hear HealthMarkets’ motion to dismiss the suit Dec. 6.

Meanwhile, Massachusetts officials have negotiated an agreement that calls for MEGA and Mid-West to comply with Massachusetts health insurance sales laws but permits the companies to continue to sell insurance in the state, HealthMarkets says.

“We are pleased that we have reached this agreement,” HealthMarkets General Counsel Michael Colliflower says in a statement. “We believe that we are in compliance with Massachusetts law and look forward to continuing to work with the Massachusetts attorney general to resolve any and all remaining issues in this case.”

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