Nadler Pushes for Federal Answer to Ian's Law to Protect Consumers from Possible Health Insurance Loophole

Press Release

Today, Congressman Jerrold Nadler (D-NY) took action to close a possible federal health insurance loophole allowing insurance companies to deny coverage to sick policyholders by canceling entire classes of insurance coverage. Nadler sent a letter to Department of Health and Human Services (HHS) Secretary Kathleen Sebelius asking the agency about the potential loophole in the Patient Protection and Affordable Care Act so as to ensure that consumers are not dropped from vital coverage. New York State recently enacted Ian's Law, sponsored by State Senator Eric Schneiderman, to address this issue. If HHS is unwilling or unable to make regulatory changes, Nadler will follow up with legislation, based on Ian's Law, to get the job done.

"What Guardian did to Ian Pearl is unconscionable," said Nadler. "Going forward, we must ensure that people with high-cost insurance needs will not live in fear that their insurance coverage will be taken away suddenly and unfairly. Whether through regulatory or legislative action, I intend to make Ian's Law a federal reality and close what may be an unjust and outrageous loophole."

These efforts are in response to the recent case of Ian Pearl, a 37-year old man who suffers from muscular dystrophy and requires 24-hour home nursing care. Because his care was expensive, his insurer, Guardian Insurance Company, discontinued the entire class of insurance policies in the state of New York that was providing his benefits. Guardian then offered policyholders who had been dropped -- including Mr. Pearl -- replacement coverage that excluded the very benefit on which Mr. Pearl relied to stay alive. New York State's Ian's Law improves notice of pending benefit discontinuations, prohibits discontinuing plans specifically from dropping high-cost policyholders, and requires offering alternative coverage for the benefit if a plan is discontinued.

"I did not set out to be a fighter for continued insurance reform," said Ian Pearl. "Yet what happened to me should not happen to any American. The promise of the federal health care reform bill is that no one who pays for insurance should lose their benefits when they get sick. The loophole that allows insurance companies to withdraw whole classes of policies from the marketplace in order to cancel specific benefits for sick people needs to be closed. I urge the Department of Health and Human Services to act on Congressman Nadler's letter to protect the tens of thousands of Americans, like me, who only ask that insurance companies provide the benefits that they promised when we paid our premiums."

"Insurance companies must not be allowed to cancel life-saving benefits through the back-door practice of suddenly withdrawing whole classes of policies from state marketplaces," said Mr. Pearl's mother, Susan Pearl. "Congressman Nadler's fight to enact a federal version of New York's Ian's Law is critical and being watched by families all over the country. Congressman Nadler's actions today are more than just about shutting down an egregious insurance practice; they are about justice and giving patients with serious medical conditions -- and their families -- a sound piece of mind."

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