Reform Alert - News from the Blues' Office of National Health Reform

Blue Cross Blue Shield of Michigan ahead of pack with long-standing policy regarding insurance rescissions

April 29, 2010

Once again, Blue Cross Blue Shield of Michigan stands as a model for national health care reform — this time with its long-standing policy of not rescinding coverage, the much-maligned practice of dropping health insurance coverage when people become sick. Blue Cross Blue Shield of Michigan proudly stands with 38 other Blues plans across the nation as an insurer that does not rescind coverage except in cases of fraud or material misrepresentation. 

"Blue Cross Blue Shield of Michigan believes in covering people, not rejecting people. We believe in fulfilling the promise of health insurance when it's needed most," said Andrew Hetzel, BCBSM vice president for corporate communications. "It has never been our policy to drop someone's coverage when they get sick, and we support the rest of the health insurance industry following suit." 

For more than 70 years, BCBSM has been a guarantee-issue insurer with a mission to provide broad access to health coverage. BCBSM is the only health insurance company in Michigan that guarantees access to coverage every day of the year; BCBSM also must submit its rates for regulatory approval prior to using them in the market. 

BCBSM has been asking the Michigan Legislature for more than three years to increase consumer protections by ending the practice of rescissions, requiring all insurers to take everyone and leveling the playing field in regards to how rates are set. 

"We are pleased to see the reforms we have championed here in Michigan take hold as a result of national health care reform," Hetzel said. "But there remains a need here in Michigan to bridge the gap between now and 2014, when comprehensive insurance reforms take effect." 

Blue Cross Blue Shield of Michigan is earning praise lately for its existing coverage policies. Just last week, as Congress and the Obama Administration pressed health insurers to change their policies of dropping young adults under age 26 from their parents' health coverage upon graduation from college, BCBSM reiterated its longstanding policy of keeping college graduates — as well as young adults who turn 19 and choose not to attend college — active on their parents' fully insured plans. Self-funded plans — plans for which Blue Cross Blue Shield of Michigan administers claims — will independently determine whether to adopt a similar approach.

The information on this website is based on BCBSM's review of the national health care reform legislation and is not intended to impart legal advice. Interpretations of the reform legislation vary, and efforts will be made to present and update accurate information. This overview is intended as an educational tool only and does not replace a more rigorous review of the law's applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. Analysis is ongoing and additional guidance is also anticipated from the Department of Health and Human Services. Additionally, some reform regulations may differ for particular members enrolled in certain programs such as the Federal Employee Program, and those members are encouraged to consult with their benefit administrators for specific details.