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Mega Life parent “hurt a lot of people”

Is this what Blackstone, Credit Suisse & Goldman Sachs want said about their investment?

"The severity of their actions certainly warranted that level of penalty. They hurt a lot of people," says Washington Insurance Commissioner Mike Kreidler, whose state and Alaska led the investigation.

Today a group of insurance commissioners handed down a $20-million fine to parent company HealthMarkets for the behavior of Mega Life & Health, and also its corporate siblings Chesapeake Life and Great West

$20 million isn’t exactly a huge fine, and it doesn’t put HealthMarkets out of business. It’ll be interesting to see whether Mega changes the quasi-fraudulent structure of its benefit plans. After all, they’ve been ruled legal in California, and my sources tell me that the medical-loss ratio is around 30 percent.

My guess is that they know that eventually they can’t stay in business this way. So they face the choice of either changing the business completely to become more worthy and less profitable, or instead to try to bleed every last dollar out of their subscriber base and semi-trained sales team. I wonder which they’ll try.

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health marketNancy FrameElliott Bettman MDJohn EntinghKT Recent comment authors
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This really is something every small company owner knows as a simple fact. Mega Life suffered growing pains 2 or more years ago and ended up being adequately punished while found to get not been criminally negligent. My question to this diligent researchers of small enterprise health care is this particular: Since the public rebuke connected with Mega life’s growing aches, has Mega Life corrected the noted deficiencies, or has Mega Life continued with too little morals and ethics? For a growing business to come across difficulties is certainly envisioned; to not correct rouge unethical conduct is usually unforgiveable.

Nancy Frame
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Nancy Frame

At he end of 08 my husbands company was pulling his health insurance. We looked around for other companies for quotes on insurance. A woman we spoke to numerous times named Stacey McBride who represented Mega Life & Health Ins. promised she could get us the most affordable ins. to meet our needs. We finally allowed her to visit our house and we listened to what we thought was a proposal that would be good for us. Giving her ALL the proper information needed to apply for the insurance, she told us she would fill out the forms for us,… Read more »

Elliott Bettman MD
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Elliott Bettman MD

I’m an Internist at a Community Health Center. Not much megalife here, but LOTS of uninsured or semi privatized Medicaid (sucks!) This is why we NEED a public option.

John Entingh
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John Entingh

Mega Life was and is a growing company, as with any growing company, growing pains occur. This is something every small business owner knows as a truth. Mega Life suffered growing pains two or more years ago and was adequately punished while found to have not been criminally negligent. My question to the diligent researchers of small business health care is this: Since the public rebuke associated with Mega life’s growing pains, has Mega Life corrected the noted deficiencies, or has Mega Life continued with a lack of morals and ethics? For a growing business to encounter difficulties is certainly… Read more »

John Entingh
Guest
John Entingh

Mega Life was and is a growing company, as with any growing company, growing pains occur. This is something every small business owner knows as a truth. Mega Life suffered growing pains two or more years ago and was adequately punished while found to have not been criminally negligent. My question to the diligent researchers of small business health care is this: Since the public rebuke associated with Mega life’s growing pains, has Mega Life corrected the noted deficiencies, or has Mega Life continued with a lack of morals and ethics? For a growing business to encounter difficulties is certainly… Read more »

KT
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KT

Hi,
There is much talk about individual insurance companies and how bad they are. Why not make recommendations on the good companies out there? Trying to find any objective information on the internet is extremely difficult.
Thanks

Alabama-Health-Insurance-1.com
Guest

Picking the right insurance carriers is a lot like picking the right spouse. You have to not look at the surface as much as what’s inside. That’s what I tell my wife anyway. TAKE A CLOSER LOOK. We are not going to mix words. Under your current health insurance plan, if you or your husband have a substantial health insurance related claim between now and when you both reach age 65, you will be responsible for medical bills in the tens of thousands of dollars that you now believe are covered. Within this letter, please find photo copies of policy… Read more »

Joe Jessome
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God bless the internet? Hopefully this relatively new means of discloser and info. sharing will, over time weed out such nonense within our industry. Letter exerpt – Picking the right insurance carriers is a lot like picking the right spouse. You have to not look at the surface as much as what’s inside. That’s what I tell my wife anyway. TAKE A CLOSER LOOK. We are not going to mix words. Under your current health insurance plan, if you or your husband have a substantial health insurance related claim between now and when you both reach age 65, you will… Read more »

Kent Roberts
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Kent Roberts

Mistake —– Not Great West — Great West is a PPO Network uaffiliated with these organizations. Midwest National is the company you’re thinking of.

Abdulla
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Health Care Problems is dedicated to gathering information for the same purpose the orthopedic surgeon gathers information: to make possible diagnosis and treatment of a problem.
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Abdulla
Alcoholism Treatment

Florida Health Insurance
Guest

This fine is a mere slap on the hand as usual. These guys make 20M a day! When we kick the insurance lobbyists out of Washington, these operations will cease to exist. No logic can explain how reputed companies continue to reak havoc.

Margaret Popovich
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Margaret Popovich

Mega Health should be put out of business right now. After paying over $15,000.00 out of pocket for our childs treatment for Hodgkins Disease a policy that was supposed to have a maximum deductible of $8,000.00 turned out to be a sham! Not one person at Mega understands the policies they sell and our agent quit over the guilt he felt in selling us this deceptive policy. Upon researching new Health Insurance we encountered numerous agents who once worked for Mega. All of them agreed the company is a sham and offers no training for any of their employees. The… Read more »

Anon
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Anon

I recently spoke with the California Insurance Commissioner’s office about MEGA Life & Health, after being turned down for an application to their alleged PPO via Health Markets. CIC person said if they are offering a PPO in California, which is what the Health Markets rep claimed to be selling me, they are not allowed to deny an application on the basis of pre-existing conditions, since it is a group policy. Prior to that, I managed to speak to an underwriter at MEGA, who, among other things, a) would not reveal her last name. When I commented that this was… Read more »