State insurance regulators in Washington and Alaska have released the results of a multi-state examination of units of an active player in the market for individual medical coverage.

The targeted companies, subsidiaries of HealthMarkets Inc., North Richland Hills, Texas, appeared to have significant problems with training agents, educating customers, handling claims and working with regulators during the period covered, which extended from Jan. 1, 2000, to Dec. 31, 2005, Washington state officials say in a summary of the exam findings.

“Transparency of activities, relationships and financial arrangements between various affiliated HealthMarkets entities and the associations was insufficient and an ongoing area of concern,” officials say.

The Washington and Alaska regulators led the exam effort for a group that included a total of 36 states and other jurisdictions.

Regulators now are starting to develop enforcement action recommendations, officials say.

The HealthMarkets examined include Mega Life and Health Insurance Company, Mid-West National Insurance Company of Tennessee, and Chesapeake Life Insurance Company.

The examiners themselves note that the HealthMarkets underwent a change in ownership in April 2006 and have made many changes in compliance and complaint-handling procedures since the end of the exam period.

HealthMarkets contends that the exam report “underscores significant changes and improvements begun in 2003.”

“Beginning in early 2003, almost 2 years before the multi-state exam was announced, our company began an intensive and exhaustive program to address the majority of the issues that were later identified in the exam,” HealthMarkets President William Gedwed says in a statement. “The changes we have made over the last 5 years have been meaningful and extensive and have resulted in improvements across all of the company’s operations.”

The company and its units started, for example, to call every health insurance purchaser to review plan coverage details, HealthMarkets says.

About 99% of the customers contacted end up keeping their policies, HealthMarkets says.

Other efforts have cut the insurance subsidiaries’ complaint rates about 50%, HealthMarkets says.

Moreover, the units examined passed 46 of 50 tests prescribed by the National Association of Insurance Commissioners, Kansas City, Mo., and the company has started an extensive agent training program, the company says.

“We do not tolerate any agent behavior that is intended to mislead customers or that violates marketing guidelines,” HealthMarkets says.