Leaders of America's Health Insurance Plans (AHIP) have announced that health plans will end the practice of rescinding coverege before they're required to do so by federal healthcare reform legislation.
The Patient Protection and Affordable Care Act mandates that health insurers end the practice of rescission of care by Sept. 23, except in cases where beneficiaries have intentionally misrepresented the facts or have committed fraud.
Karen Ignagni, president and CEO of AHIP, said many health plans already abide by the standards outlined in the new law.
"Our community is committed to implementing the new standard in May 2010 to ensure that individuals and families will have greater peace of mind when purchasing coverage on their own," she wrote in a letter to Congress on Wednesday.
Ignagni said health plans are working to implement the healthcare reform law without disrupting coverage for the more than 200 million people on their insurance rolls.
According to Ignagni, more than a year ago health plans proposed reforms that would end rescissions, provide guaranteed coverage with no pre-existing condition exclusions and discontinue health status rating in conjunction with an effective personal coverage requirement.
Health and Human Services Secretary Kathleen Sebelius recently called for insurers to voluntarily implement key provisions of the Affordability Act. This week UnitedHealthcare and WellPoint announced they will stop canceling coverage after a beneficiary is diagnosed with an illness.
"The days when insurers can drop coverage when patients get sick are coming to an end, but insurers don't need to wait to do the right thing," Sebelius said. "Americans need to be secure in knowing that their health coverage will be there when they need it most."
Sebelius said she will continue to press insurers not to wait until the fall "to do the right thing."