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Case ID: 4916 | Insurance | 09/19/2006
A class action suit filed in Baltimore alleges that CareFirst BlueCross BlueShield of Maryland has overcharged policyholders millions of dollars by jumping the gun on premium increases permitted by their health insurance policies.
The lawsuit - brought on behalf of Richard B. Cort, a self-employed Columbia, MD resident, and all similarly-situated Marylanders - alleges that CareFirst uses a policy provision allowing it to increase premiums on certain policyholder birthdays (for example, when the oldest insured in a household turns 50-years-old), but does so on the first day of the month in which the birthday occurs. "Even though Mr. Cort turned 50 on September 19, 2005 - moving him into the next age category - CareFirst prematurely billed him and his entire family at the higher premium dictated by his new age category beginning on September 1," explains the attorney that filed the lawsuit. "That premature billing amounts to an overcharge for that month of $78.60 in Mr. Cort's case alone; it potentially amounts to millions of dollars when you consider how many people CareFirst insures and how most of those policyholders do not have birthdays that occur on the first day of the month," the attorney adds. CareFirst's typical policyholder contract allows for a rate increase when the oldest insured individual in a household turns the ages of 1, 6, 18, 30, 40, 50, or 60. "CareFirst's failure to prorate the premium increase to provide policyholders with a lower premium rate for that portion of the month in which they have not yet moved from one age category to the next may amount to millions of dollars in the aggregate," says the lawyer. The class action lawsuit seeks compensatory damages equal to all premiums or portions of premiums that have been prematurely increased within the past three years. The suit also seeks to enjoin CareFirst from increasing policyholder premiums prior to the birthday on which they move from one age group to the next. At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Insurance Cases of Interest Blue Cross & Blue Shield of Rhode Island has settled two class-action lawsuits for $17.5 million in connection with claims processing practices that allegedly reduced subscribers' benefits and increased their out-of-pocket expenses for several years. UnitedHealthcare of New England settled a smaller, but similar case in 2002 for $4.4 million. Blue Cross explained its settlement as a way to "avoid the cost and uncertainties of trial and possible appeals," and to expedite payments to the affected people. Blue Cross also said it does not expect this to affect its reserves or increase rates or premiums. The bulk of the payout will go to an estimated 115,000 former and current subscribers, who will get $10 to $2,500, or an average of about $95 each. Asbestos-related work injuries can be devastating. The parties have reached a tentative $375 million settlement in several class actions filed against Travelers Property Casualty Corporation on behalf of persons exposed to asbestos and their families, who allege that the insurer engaged in unfair trade practices by inappropriately handling and settling asbestos claims. The theory of diminished value asserts that buyers choosing between two otherwise equal vehicles will select one that has not been previously damaged and repaired, even where the repairs to the other vehicle were first-rate. The parties have reached a tentative $1.725 million settlement in an action filed against Southern General Insurance Company on behalf all persons insured under an automobile insurance policy issued in Georgia by the company who made a claim for damage to their vehicle under their collision or comprehensive coverage for a loss that occurred between June 12, 1997, and February 13, 2002, or under their uninsured motorist coverage for a loss that occurred between June 12, 1999, and February 13, 2002. Though there is no claims deadline at this time, persons eligible to take part in the settlement who have not received a notification letter should act as soon as possible to alert the company of their eligibility.
A national class action has been filed against prescription drug plan operator Express Scripts, Inc. on behalf of all U.S. citizens who were or are participants in or beneficiaries of any employer-provided prescription benefit plan (1) that required participants or beneficiaries to pay a percentage co-pay for prescription drugs and (2) for which Express Scripts, Inc. or one of its predecessors-in-interest or subsidiaries serves or has served as the plan's provider of prescription drugs at any time from October 1, 1997, through the present. The action is brought under the Employee Retirement Income Security Act (ERISA) and claims that Express Scripts breached its fiduciary duty to plan participants and beneficiaries in several ways. The participants are seeking declaratory and injunctive relief and a court order requiring Express Scripts to make an accounting of and reimburse consumers and benefit plans all monies earned through allegedly unlawful activities.
The parties have reached a tentative settlement apparently valued at $25 million in several actions filed against UICI, Inc., and its principal insurance subsidiaries MEGA Life and Health Insurance Company and Mid-West National Life Insurance Company of Tennessee on behalf of policyholders insured through groups associated with the companies. Persons eligible to take part in the action should contact the attorneys for the class for more information. Kahn Gauthier Swick is investigating claims against UnumProvident Corporation, the largest disability insurance company in the U.S., for wrongfully denying claims, or for ending benefits on claims they had originally approved. |
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