Insurance Snafus: The Computer Ate My Homework And Other Myths

Last Updated Sep 14, 2009 8:06 PM EDT

It seems that whenever a health insurer has an embarrassing problem, it blames it on a computer snafu. The latest instance of this are the deficiencies that led the Centers for Medicare and Medicaid Services to suspend new enrollment in WellPoint's Medicare Advantage and drug plans for nine months. CMS halted enrollment in WellPoint plans Jan. 12, after receiving a number of consumer complaints about rate hikes and denied benefits. WellPoint attributed the problems to glitches its computer system that somehow went uncorrected until CMS cracked down. Since then, however, it has remedied some of its alleged shortcomings.

With CMS' permission, WellPoint will resume marketing its Medicare plans Oct. 15 and will start enrolling new customers Nov. 1. CMS said WellPoint had made enough progress to warrant lifting the suspension, but that it would remain bound by existing corrective action plans for its appeals and grievances processes.

CMS found in January that there were "widespread and continued failures by WellPoint to properly administer their contracts in accordance with CMS requirements." The areas in which CMS found WellPoint deficient included enrollment and disenrollment, benefits administration, grievances and appeals, marketing, claims processing, coordination of benefits, billing, and meeting call center and customer service requirements. Beyond that, there's not a whole lot left that WellPoint could have done right!

Interestingly, WellPoint, the largest health insurer in the country, also recently admitted there had been problems in processing physician claims at its Anthem Blue Cross and Blue Shield subsidiary. The Indiana and Ohio medical associations had complained to their state insurance departments about payment delays that lasted up to several months. And WellPoint blamed-you guessed it-the adoption of a new claims processing system by the BlueCard Network, which allows Blues members to use the networks of Blues plans in other states.

Over the years, I've seen many health plans use the same dodge whenever they're accused of incompetence. It's sort of like saying "my dog ate the homework." Unfortunately, more is involved here than getting a lower grade in your class. Providers go unpaid, and patients do not get the benefits they're entitled to. It's almost enough to make you wonder-as many physicians do when they charge health plans with profiting off the "float" on their funds-whether some of these failures to compute are accidental or purposeful.

Like the meaning of life, this is one of those things we'll probably never know. But at least it's good to know that the government holds insurance companies to account, if only occasionally.

  • Ken Terry

    Ken Terry, a former senior editor at Medical Economics Magazine, is the author of the book Rx For Health Care Reform.