Knoxville woman says insurance company misrepresents coverage

Knoxville woman says insurance company misrepresents coverage

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"I've always said the healthcare system in this country is awful. But now, I'm caught in the middle of it," Marian Jay said. "It's terrifying." "I've always said the healthcare system in this country is awful. But now, I'm caught in the middle of it," Marian Jay said. "It's terrifying."

By DON DARE
6 On Your Side Consumer Investigator

KNOXVILLE (WATE) - A Knoxville woman claims an insurance company misrepresented a plan that was supposed to protect her while she was uninsured and help her quality for a new government plan.

The state has even gotten involved in Marian Jay's case.

Understanding health insurance plans and policies is complex. You can read about them online, but often the information is still difficult to grasp. That's why many people go to the experts, insurance agents.

If you suddenly find yourself without insurance and you have a pre-existing condition, navigating your limited options is even more difficult.

Marian Jay works as an office manager and she's been without health insurance since last fall when her employer was forced to drop coverage for the office due to economic pressures.   

Since she has diabetes, Marian applied for coverage with the government's Pre-Existing Condition Insurance Plan (PCIP), created by the Affordable Healthcare Act of 2010.

However, when she went to the website she discovered she'd have to wait half a year to become eligible.

"And sure enough, they would offer people protection with pre-existing conditions, but you  have to be without insurance coverage for six months," Marian said.

She didn't want to be without health insurance. To bridge the gap, Marian's insurance agent suggested First Choice, a limited benefit insurance plan, or what's called a fee for service.

"It also says in its paperwork that it will cover for three doctors visits and one mammogram," Marian said.

She knew that to be eligible for the pre-existing plan, she'd have to wait and go without what's called creditable insurance.

When Marian and her agent examined the website for First Choice, they carefully checked the policy to make sure it would not disqualify her for PCIP.

"The question on their website, is First Choice a qualified plan under healthcare reform? Capitalized, no!" Marian said. "First Choice is not a health benefits plan and does not qualify as credible coverage under PPACA."

But last spring, she got bad news. "Six months after I had been without insurance, I went to PCIP to apply for insurance, and I had put down I had this indemnity policy. They refused to cover me, saying that this First Choice is credible insurance," Marian said.

That leaves her with "Nowhere to go, no insurance and very scared."

In Nashville, when the Tennessee Justice Center heard of Marian's situation, it got involved on her behalf.

"First Choice told her, you can buy our plan. It won't count against you. It's not creditable coverage," said staff attorney Chris Coleman.

Yet, it did count against her. "And she was denied insurance coverage, and to this day she is uninsured," Coleman said.

He sent a letter to the Tennessee Department of Commerce and Insurance, claiming there were misrepresentations on the part of First Choice.

"It provided benefits well beyond the minimum for most limited benefit plans," Coleman said.

He says at best, this is "a case of negligent misrepresentation. I believe if a company represents something that they knew, or should have known was false, that is false advertising."

Marian went to the doctor twice believing her First Choice plan would pay the bills, but it didn't. "She gets a letter saying it is denied because that's part of your pre-existing conditions of diabetes. Even though under the policy, mammograms are covered," Coleman explained.

Marian has canceled her First Choice plan. The Tennessee Justice Center has written a letter on her behalf, demanding a refund on all premiums paid to date.

"I've always said the healthcare system in this country is awful. But now, I'm caught in the middle of it," she said. "It's terrifying."

First Choice has responded to the state's inquiry, claiming it's done nothing wrong.

First Choice has refunded some of Marian's medical bills, but she's holding out for a complete reimbursement.


If you have a consumer issue, call the 6 On Your Side Hotline at 865-633-5974 or email ddare@wate.com.

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