California Issues Insurance Directive on Discrimination

Sacramento, CACalifornia’s Department of Managed Health Care has issued a directive to ensure there are no violations of California Insurance Law when it comes to denying insurance to transgendered people. The directive is aimed at guaranteeing a person has access to health care regardless of his or her gender identity or expression. Discrimination against a person based on gender identity or expression is a violation of California Insurance Law and the Insurance Gender Nondiscrimination Act of 2006 (IGNA).

“IGNA prohibits health plans from discriminating against individuals because of the individual’s gender, including gender identity or gender expression,” the agency noted in its directive, issued April 9, 2013. “This prohibition extends to the availability of health coverage and the provision of benefits.”

The directive orders health plans to “Ensure that individuals are not denied access to medically necessary care because of the individual’s gender, gender identity or gender expression,” and to review and revise health plan documents to ensure they are compliant with IGNA, including removing exclusions related to gender transition services. According to the directive, exclusions or limitations that are prohibited are those that exclude coverage of “transsexual surgery” and/or “transgender or gender dysphoria conditions.”

Under the directive, patients who are denied coverage have the ability to appeal the decision to the Department.

Meanwhile, a doctor in California won a lawsuit against Anthem Blue Cross, after he alleged his application to join the insurance company’s preferred provider network was unfairly denied. Anthem Blue Cross said the doctor was rejected because the company did not need another general practitioner, but Jeffrey Nordella alleged he was denied because when he was in their network previously, he advocated for patients who had their insurance claims denied.

According to Thomson Reuters (4/10/13), a jury awarded Nordella $3.8 million for lost salary and profits. The jury also found Anthem Blue Cross acted with malice, meaning Nordella can now request punitive damages against the company. In California, doctors can file a lawsuit under the fair procedure law if they believe an insurer has excluded them for arbitrary reasons.

The verdict means that insurers may have to work harder to prove a decision to exclude or terminate a doctor from a network is based on reasonable business decisions. It may also mean physicians who believe they were rejected because of patient advocacy are more likely to file lawsuits of their own.

The lawsuit is Nordella v. Anthem Blue Cross, Los Angeles Superior Court, No. BC444364.