California Insurance Commissioner Steve Poizner has stopped a health insurer operating in his state from paying a $120 million dividend to its parent company.
Poizner issued an order prohibiting PacifiCare Life & Health Insurance Company from transferring the payment to UnitedHealth Group Inc., Minnetonka, Minn. (NYSE:UNH).
Poizner says he is blocking the dividend payment because PacifiCare is involved in enforcement proceedings that could lead to PacifiCare having to pay substantial penalties.
UnitedHealth acquired PacifiCare in 2005. Since then, Poizner says, the California Department of Insurance has received complaints about how PacifiCare has handled claims.
Administrative proceedings relating to alleged claims-handling problems started in December 2009, officials say.