The LA Times reports that California officials are going to force insurers to reinstate people whose policies were rescinded over incomplete or inaccurate information supplied in the underwriting/application process.

Insurers have long practiced the policy of rescission on the grounds that it is necessary in the never ending war against fraud. On the other hand, rescission is viewed as a harsh and untimely pill to swallow at a time when people are most likely to need coverage they thought they had purchased.

LA Times story here

COMMENT: Do you think forcing major insurers in California to reinstate sick people is going to make health insurance cheaper or more expensive? As an agent with over 25 years experience, I have seen my share of policy rescissions, and they are never pretty. Sometimes they seem questionable, while at other times, you’re left wondering why these people are sent to prison for their clear attempt to defraud a company.

I do, however, agree with one principle set forth by the California officials: insurance applications can be difficult to decipher at times.

For my two cents worth, I also think it should not be allowed for one spouse or domestic partner to answer health questions on behalf of the other! I have seen this identical situation lead to more than one rescission–where everyone was actually telling the truth–everyone who spoke, that is. But as it turns out, the spouse never told the other spouse about certain health conditions he or she may have had.

And then there are the doctors. Don’t even get me started. Oh, ok, I’ve already started. Sometimes these rescissions are the doctor’s fault. Believe it or not, doctors often do not fully advise patients of the true nature of their health conditions. When the insurance company finally orders medical records, they give full weight to what is contained in the records.

So why don’t insurers just order records all the time? Do you have any idea how much that would cost?

See? It’s a vicious circle. It really is–it just goes round and round with everyone pointing the blame at each other.

Surely, the Democrats will rescue us all — this time.

(you believe that, don’t you?)