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This just in from Massachusetts attorney general Martha Coakley:
Aetna life insurance to pay more than $1 million for allegedly failing to cover mandated health insurance benefits and deceptively marketing student health insurance
At Least $500,000 in Restitution for Affected Massachusetts Consumers
BOSTON – After allegedly failing to cover certain medical services as required by state law and deceptively marketing its coverage to Massachusetts college students, Aetna Life Insurance Company (Aetna Life) will pay more than $1 million in civil penalties and restitution, Attorney General Martha Coakley announced today.
“When Massachusetts consumers buy health insurance, they should be able to feel confident that the coverage complies fully with Massachusetts law,” AG Coakley said. “Our office will continue to monitor the marketing and payment practices of health insurers to make sure that Massachusetts consumers are not being misled or denied benefits to which they are legally entitled.”
The AG’s complaint, filed along with the consent judgment in Suffolk Superior Court today, alleges that Aetna Life violated the state’s Consumer Protection Act by falsely marketing the scope of the coverage it offered to students. The alleged violations include overstating in marketing materials the aggregate maximum amount of certain Aetna coverage as $500,000 when it was really $50,000. The complaint also alleges that Aetna Life did not cover health services required by state law including mental health care, “pap” test screening, mammography, and preventive care for children up to age six.
Under the terms of the consent judgment, Aetna Life must pay a minimum of $500,000 directed toward consumer relief. After compensating affected Massachusetts consumers, any remaining portion of the $500,000 will be paid to the Commonwealth. Aetna Life has also agreed to pay $500,000 in civil penalties to the Commonwealth and $55,000 for the costs of the AG’s investigation. According to public information, from 2007 to 2010, Aetna Life provided insurance to an average of approximately 30,000 students each year. Affected consumers that are entitled to relief will be contacted directly by Aetna.
According to state law, full-time and some part-time students at institutions of higher learning are required to participate in a qualifying student health insurance program (unless the requirement is waived based upon their having comparable coverage). As reported by the Massachusetts Division of Health Care Finance and Policy, between 2007 and 2010 Aetna Life insured the largest number of Massachusetts students through student health insurance programs, which it offered at 13 or more Massachusetts colleges and universities.
Consumers concerned about illegal health insurance practices in the Commonwealth are urged to call the Attorney General’s Health Care Hotline at (888) 830-6277. Consumers who wish to purchase health insurance can find a number of available options at www.mahealthconnector.org. Guidance on how to choose a health plan is also available on the Attorney General’s website.
This program aired on June 27, 2012. The audio for this program is not available.
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