Let’s start with a fundamental truth:  Insurance companies are in the business of not paying claims. 

By not paying your claim, they get to keep all those premiums you pay.  Maximizing their benefit by minimizing their risk, by finding loopholes and other reason to deny claims unless and until they are either cornered into paying them or a claim is so clear-cut they can’t avoid it under risk of bad faith.  Welcome to the wonderful world of profit and to hell with the consequences. 

From AP via the Insurance Times (PDF):

Many successful companies are known for taking risks. Cigna Corp. isn’t one of them….

The lack of risky business, Wall Street analysts say, has helped Cigna avoid many problems associated with rising health costs, an issue plaguing competing health plans. And the company’s low profile has made it less of a target for class action suits filed in recent years accusing HMOs of putting profits ahead of patient care. Cigna has been named in only two of six lawsuits, most of which are either pending or that have ended with rulings in the industry’s favor. But Cigna officials say their quiet stance means the company’s accomplishments aren’t well known….

Insurance companies make money by finding ways to not pay claims.  That’s the truth of it.   This past week, we sadly saw the result of this in the death of Nataline Sarkisyan.  From the CA Nurses Association:

On Dec. 11, four leading physicians, including the surgical director of the Pediatric Liver Transplant Program at UCLA, wrote to CIGNA urging the company to reverse its denial. The physicians said that Nataline “currently meets criteria to be listed as Status 1A” for a transplant. They also challenged CIGNA’s denial which the company said occurred because their benefit plan “does not cover experimental, investigational and unproven services,” to which the doctors replied, “Nataline’s case is in fact none of the above.”

The CA Nurses Assoc. organized a massive protest against Cigna’s spreadsheet-based decision, but the turnaround from Cigna came too late for Nataline, who passed away without ever receiving her transplant. C&L has news video on the story, and it is absolutely heartbreaking.

I keep thinking about this poor girl’s parents, having already gone through so much with their child who battled and survived cancer only to face this latest hurdle, to be told by doctors — including the head of pediatric transplant surgery at UCLA — that she had at least a 65% chance of surviving six months or more with a liver transplant…and then be told by their for-profit insurers that they wouldn’t pay to save their child’s life.   Death by spreadsheet and profit margin, indeed.  All Spin Zone lays it out (via RawStory):

AP/AR is is business shorthand for “accounts payable / accounts receiveable”. In theory, as long as AR > AP on the corporate ledger, a company is profitable and satisfies the needs of its stakeholders (business partners, customers, vendors, employees, and stockholders). So, most large companies employ teams of individuals who manage corporate risk. Guidelines and protocols are established to enable these teams to make decisions on when it makes economic sense to spend money, approve projects, and invest in research and development.

It’s all about risk management. Keep this in mind as you read further — because you are a risk, not a client — to your healthcare, life, auto, and homeowners insurance providers….

The conflict between medical treatment needs and the corporate bottom line happens in a whole lot of medical cases. In the abstract, you can see why this happens. But, as a parent, I’ll be damned if I could sit back and swallow my child being treated as an abstract argument. These are human lives we are talking about — a living, breathing child in this case now lost as another death by profit margin against the clear advice of the medical professionals who were treating her. 

This is not an isolated incident.  The next one could be you or someone you love…

(H/T to Dean M.)