Letter to Scott Kipper, Commissioner of the Nevada Division of Insurance - Horsford Calls For Investigation Of Misleading Letters Sent By Nevada Insurance Company

Letter

Representative Steven Horsford (NV-4) recently sent a letter to Commissioner Scott Kipper of the Nevada Division of Insurance urging him to investigate Nevada insurance companies for sending misleading letters to customers and for failing to properly inform consumers of their full options when purchasing or renewing their health plans.

Horsford specifically cited a letter sent by Blue Cross Blue Shield of Nevada to policyholders whose plans will no longer be offered after 2014. In the letter, the company did not list Nevada Health Link, the state's newly created insurance exchange under the Affordable Care Act, as an option for consumers to purchase health insurance. Many consumers may qualify for federal subsidies for health plans through the exchange, a fact only acknowledged in a brief footnote in the letter in question.

"Earlier today I had a discussion with insurance company representatives after receiving complaints from constituents about confusing letters they were mailed regarding their insurance plans," said Horsford. "I've concluded that these letters fail the test of transparency and conceal important information that Nevada consumers deserve to know. I demand the Nevada Insurance Commissioner protect consumer interests, not corporate interests, in Nevada's health care marketplace by launching an investigation into these letters. In addition, the insurance company should reissue letters to consumers that are clear, complete, and transparent."

The insurance letters in question are attached to this email. Depending on the status of a current enrollee's insurance plan, they received one to two letters, inadequately describing consumer options on the Nevada Health Exchange.

"I will be asking additional questions of insurance companies and the Nevada Division of Insurance in the following days," Horsford continued. "Nevada consumers deserve straight answers about their health care options, not misleading information."

Horsford also sent the letter to Governor Brian Sandoval and other state leaders. The full text of the letter is below.

November 19, 2013

Dear Commissioner Kipper:

In light of the Obama Administration's announcement that health insurance companies can continue offering certain healthcare plans for 2014, I am writing to urge you to ensure that insurance companies accurately communicate the options consumers have when purchasing or renewing their plans.

As you may be aware, some insurance companies have used misleading language in their cancellation notices to policyholders. Recently, the Kentucky Department of Insurance fined Humana of Kentucky $65,430 for misleading letters that inadequately listed the state's exchange as an option to shop for coverage. Unfortunately, Humana of Kentucky is not the only company issuing misleading letters to consumers.

I recently held a telephone town hall during which several constituents complained about questionable practices by insurance companies in Nevada. For example, a letter sent by Anthem Blue Cross Blue Shield of Nevada listed only three options for policyholders: renew a similarly designed plan, do nothing, or shop for a different Anthem plan. Renewal letters sent by the same company to policyholders whose plans are "grandfathered" only provided two options: stay on the current plan or choose a different Anthem plan.

The letters do not list the state exchange, Nevada Health Link, as an option for consumers to purchase health insurance. Only in a footnote do the letters briefly mention that customers may qualify for federal subsidies through the exchange. This vital information regarding Nevada Health Link is virtually undisclosed to Nevada consumers as it is buried in a footnote and does not clearly outline options to compare and choose competing plans on the state exchange. Put simply, these letters are misleading and impair the ability of Nevadans to make informed decisions about their health insurance.

It is my understanding that Anthem Blue Cross Blue Shield has issued approximately 11,000 cancellation notices and approximately 9,000 "grandfathered" plan notices.

I am urging your office, as the agency responsible for regulating private insurance plans in Nevada, to initiate an investigation on the misleading letters sent by Anthem Blue Cross Blue Shield of Nevada. Additionally, I ask you to ensure no other health insurance company in Nevada is sending equally questionable and misleading letters.

There is no doubt that the rollout of the Affordable Care Act has been challenging. Despite difficulties, Governor Sandoval worked with the Nevada Legislature to establish a state exchange and worked to implement the Affordable Care Act. It is our responsibility to work together at the state and federal level to ensure the law is implemented properly and to make improvements where necessary. To that end, we must provide Nevadans with the information they need to make the best, most informed decisions for their personal health care needs.

Sincerely,

Steven Horsford
Member of Congress
Nevada's 4th Congressional District

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