This is actually old news, but it’s pertinent:
Rescission was largely hidden until three years ago, when The Times launched a series of stories disclosing that insurers routinely canceled the medical coverage of individual policyholders who required expensive medical care.
Sassi said rescissions are necessary to prevent people who lie about preexisting conditions from obtaining coverage and driving up costs for others.
“I want to emphasize that rescission is about stopping fraud and material misrepresentations that contribute to spiraling healthcare costs,” Sassi told the committee….
But rescission victims testified that their policies were canceled for inadvertent omissions or honest mistakes about medical history on their applications. Rescission, they said, was about improving corporate profits rather than rooting out fraud….
“Insurers ignore the law, and when they find a discrepancy or omission, they rescind the policy and refuse to pay any of your medical bills — even for routine treatment or treatment they previously authorized,” Horton said….
Late in the hearing, Stupak, the committee chairman, put the executives on the spot. Stupak asked each of them whether he would at least commit his company to immediately stop rescissions except where they could show “intentional fraud.”
The answer from all three executives:
Health insurance is a scam.