Blue Cross Takes New Stance On Rescission Policies

Law360, New York (May 11, 2007, 12:00 AM EDT) -- Blue Cross of California will stop its controversial practice of canceling individual health plans unless it can prove policyholders lied on their applications, which could trigger a wave of changes across the industry.

The largest health insurer in the state said Thursday it would change its rescission policies to resolve a class action filed by nearly 6,000 former policyholders. Blue Cross’ cancellations of health coverage often followed patient claims for medical treatment.

The decision is a major turnaround for the health insurer. Blue Cross said it...
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