Insurance Commissioner Mike Kreidler has fined Regence BlueShield and Asuris Northwest Health $750,000 after a multiyear investigation into problems with customer service, billing and payments.
Washington Insurance Commissioner Mike Kreidler has fined Regence BlueShield and Asuris Northwest Health $750,000 for violations linked to a flood of customer complaints between January 2010 and June 2011.
The yearslong examination of the firms that serve more than 1 million people in the state found multiple problems including a flawed system for handling customer complaints, misplaced records, delayed payments, problems tracking payments and use of uncertified Spanish-language translations that resulted in inaccurate or confusing information for consumers, Kreidler said Wednesday.
Hundreds of customers called the state insurance-complaint line, saying premiums had been taken from the wrong bank accounts — or from people who weren’t Regence subscribers.
“There were problems where providers weren’t getting paid and they were billing the policyholder,” Kreidler said. “It just became kind of a cascading thing.”
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The companies also delayed the investigation for years with problems gathering required data and other information, he said.
In a consent order, the companies agreed to pay the fine in full by Sept. 22, with the money going to the state’s general fund, a release from Kreidler’s office said.
Officials with Cambia Health Solutions, the parent company of Regence BlueShield and Asuris, said the problems six years ago were “temporary service issues” that affected some customers and providers. The issues were resolved in 2012, according to spokeswoman Jennifer Morgan.
“We truly regret any inconvenience this has caused,” she said in a statement.
Any delay in providing records to Kreidler’s office “wasn’t something intentional,” she said.
The investigation started in 2010 after complaints from policyholders. Kreidler held a meeting of insurance commissioners in four states and launched what’s called a market-conduct examination of the issues.
“I wanted to make sure consumers get what they’re paying for when they’re paying their insurance premiums,” Kreidler said.
This is the second-largest fine that Kreidler’s office has levied since 2007. The largest was $1 million against insurer Aetna in January 2013.
Kreidler, a Democrat who is running for re-election this year against Republican Richard Schrock, acknowledged that fines are low compared to company profits.
“It is relatively small compared to their total operations,” he said.
But, he added, there’s a larger impact.
“It’s of reputational concern to them; it can affect their ratings,” Kreidler said. “It has a great deal more impact than just the fine.”
Fines against insurers are determined by a committee within the commissioner’s office. The group meets to consider the facts of the case, the severity of the infractions, the impact on consumers and applicable state laws before voting on a final amount.
Regence BlueShield serves 1.1 million people in Washington; Asuris serves about 50,000, according to the firms’ websites. Regence bought Asuris in 1994 and both are owned by Cambia Health Solutions, based in Oregon.