New York State insurance regulators say they have imposed a $1 million fine on a health insurer in connection with claims denied several years ago.
HealthNow New York Inc., Buffalo, N.Y., agreed to pay the fine, and to reprocess claim denials for about 2,500 women, to resolve an investigation by the New York department, officials say.
The New York department began the investigation after receiving a complaint that the carrier had denied a woman’s claim for coverage for fertility treatment in 2004.
The New York department found that the carrier had to pay the claim because the treatment was not specifically excluded under state law, and it then conducted a broader examination of the insurer, officials say.
Penalties include $600,000 for infertility coverage claim violations and $450,000 for other violations, such as giving members 15 days notice of rate increases, instead of the 30-day notice required by law, officials say.
HealthNow provides or administers health coverage for about 815,000 people in upstate New York.
HealthNow notes that the New York department exam included an audit of company systems and procedures in effect from October 1999 through December 2003, along with events that occurred from 2004 to 2006.
“Changes have been implemented in recent years in process, procedures, employee training and personnel,” the company says in a statement. “We are confident that appropriate steps necessary to prevent recurrence of similar violations in the future have been made.”
HealthNow has been cooperating with New York department officials for more than 4 years, because the audit was not completed until late 2006, the company reports.
“A corrective action plan was issued on October 2006 and those changes were implemented,” the company says. “Since that time, prompt-pay fines and consumer complaints have been reduced, while response time to member concerns has improved.”