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January 17, 2013 at 07:53 AM
HealthNow New York Inc. has been fined a civil penalty in lieu of a disciplinary action of $700,000 by the New York State Department of Financial Services (DFS) for failing to explain coverage and benefit rights to certain health plan members and for failing to tell members how to appeal claims denials.
HealthNow, a Buffalo-based not-for-profit health insurer, was cited for approximately 164,000 instances of failing to provide explanation of benefits statements that contained all the necessary wording, according to the DFS.
The statements, required under state law, are intended to describe what services the plans cover and how consumers can appeal when they believe claims are improperly denied.
In addition, the company was cited for failing to:
- File certificates of appointment for its agents;
- Timely notices of appointment of agents;
- Notify the insurance department of the company’s termination of agents; and
- Ensure that commissions were paid only to licensed insurance agents and producers.
HealthNow failed to provide to its members written acknowledgement of grievances within 15 business days, as required by law, the DFS stated.
HealthNow waived its right to further notice and hearing in this matter and admitted the violations. It also agreed to take steps necessary to prevent the violations from occurring again. The company agreed to revise procedures regarding issuing explanation of benefits statements and making mandated filings regarding its producers.
The violations occurred during the period Jan. 1, 2004, through Dec. 31, 2008, according to the stipulation and were turned up during an examination covering that five-year period. The stipulation can be found on the Department’s website.
