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Braly, Obama spar again over WellPoint cancellation policies

May 10, 2010

Angela Braly keeps sparring with President Obama’s administration—this time with the president himself.

The CEO of Indianapolis-based WellPoint Inc. dashed off a letter on Sunday trying to rebut Obama’s weekend criticism of the health insurer for reports that it seeks out breast cancer patients to cancel their policies.

Such claims were reported last month by the news service Reuters, but WellPoint called the story “inaccurate and grossly misleading.”

In her letter, Braly reported that WellPoint paid for breast cancer coverage for 200,000 women last year and canceled the policies of just four. None of the cancellations were because the women had breast cancer, Braly said, suggesting instead that the women had misrepresented their health status.

The Obama administration first chided WellPoint immediately after the Reuters story appeared on April 22. Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, wrote a letter to Braly, calling WellPoint’s alleged practice “deplorable” and “unconscionable” and asking for WellPoint to stop the practice immediately.

Then on Saturday, during his weekly radio address, Obama noted how Sebelius’ letter got results—even though he didn’t name WellPoint specifically.

“When we found that an insurance company was systematically dropping the coverage of women diagnosed with breast cancer, my administration called on them to put an end to this practice immediately,” Obama said. “Two weeks ago, the entire insurance industry announced that it would comply with the new law early, and stop the perverse practice of dropping people’s coverage when they get sick.”

WellPoint did change its rescission policy two weeks ago to match the new health law signed by Obama in March. The new law says health insurers can cancel a customer’s policy only in cases of fraud or intentional lying. Previously, health insurers would sometimes cancel a customer’s policy even if he or she omitted or misconstrued information, even unwittingly.

Braly chided Obama for continuing to attack health insurers—as he did effectively in working to get the law passed—at a time when implementing the new law requires greater collaboration.

“If we are going to make this law work on behalf of all Americans,” Braly wrote, “the attacks on the health insurance industry—a valued industry that provides coverage for more than 200 million Americans—must end.”

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