Aetna Begins Allowing Third-Party Review of Policy Recissions

Aetna has started allowing third-party review of health insurance policy recissions in all 50 states. According to the L.A. Times, health insurance policy recissions are an increasing problem in many parts of the country, especially California, where state insurance regulators are taking action to protect consumers from losing their coverage retroactively. In most cases, this coverage loss, called "recission", occurs after the insured makes a large medical claim which the insurer feels could be related to an undisclosed pre-existing health condition. Policy recissions are retroactive to the date coverage began, meaning that consumers lose their creditable coverage for HIPAA purposes, and could potentially be liable for all claims paid under the policy.

Third-party review is an important consumer protection because it allows for medical experts outside the insurance company to decide whether it is fair for the insurer to revoke an individual's insurance coverage. Aetna is the first insurer to allow for third-party review in all 50 states, but other insurers are sure to follow suit, especially in California, which is expected to issue rules and regulations requiring this kind of review for all insurers.