Combining Health Coverage
Monday, November 3rd, 2008
Some California health insurance companies, inlcuding Kaiser Permanente, Health Net, and Blue Shield of California, have warned brokers across the state that if they combine health insurance plans offered by their companies with other forms of insurance or “wraparound” plans to cover the gaps in coverage, they may be refused earned commissions or even lose their appointment with the health insurer.
One example of one of these wraparound plans is Ben-e-lect, a flexible benefits program that sells wraparound plans to businesses and has partnered with more than 30 chambers of commerce.
Health insurers do not like the practice of bundling because they claim it encourages their members to not be judicious about their health care spending and actually overuse their health coverage.
California Insurance Commissioner Steve Poizner is investigating the issue to determine whether firing health insurance brokers in this scenario would constitute a brach of legality and contractual obligation.
