Whether you develop a chronic health condition or experience a severe injury from a devastating accident, you expect your health insurance to be there when you need it most. Ian Pearl relied on his health insurance to provide the 24-hour nursing home care his muscular dystrophy required.
Although Pearl's insurer initially covered his care, one day he was informed his coverage would be terminated and no comparable replacement policy was offered. Pearl then filed a lawsuit against his insurer, Guardian Life Insurance Company of America, to advocate for his rights.
In the course of the insurance litigation it was revealed the insurance company referred to Pearl and other policyholders requiring more expensive treatment as "dogs" and "trainwrecks." It was also discovered that the company had discontinued the entire plan as a pretext for dropping his expensive coverage.
Even though the court upheld the discontinuance, Ian was victorious in his fight to get the laws in New York amended. "Ian's Law" will enhance protections for consumers when a health insurer discontinues policies.
"Ian's Law" Requirements of Insurers:
- Policyholders are provided written notice of discontinuation 90 days in advance.
- Policyholders affected by a discontinuation are notified of the option to purchase replacement health insurance offered by the insurer.
- A group plan may not be discontinued specifically to drop a high-cost policyholder.
In sum, insurance companies will not be able to terminate a class of policies as a ploy to avoid paying a single person's claims. Insurers will also have to provide advance notice and offer replacement coverage when they do elect to discontinue insurance policies.
Additionally, the law includes a review process by the state superintendent of insurance. This process will ensure policyholders experiencing serious medical conditions, who have made use of their benefits in the previous 12 months, are able to maintain their current coverage if comparable replacement coverage is not offered.
Now New Yorkers can be assured that if they experience a car accident or are diagnosed with a serious health condition their health insurance won't suddenly be terminated.
The new requirements will take effect in New York on January 1, 2011. New York Congressman Jerrold Nadler is also working to close any similar loopholes in the federal laws.
