State Stings Aetna for Misleading Students

By MOLLY HAMILL

BOSTON (CN) - Aetna Life Insurance will pay restitution and $1 million in penalties in a consent judgment with Massachusetts, for failing to cover required medical services and deceptively marketing itself to college students.

The commonwealth's complaint in Suffolk County Court enumerate a litany of deceptive acts, including denial of required benefits for mental illness, for maternity-related matters and newborns, and for mammograms and outpatient contraceptive services.

Also on the list was misrepresentation of terms of coverage for hospice services, emergency services and prosthetic devices, among others. In Massachusetts, full-time and some part-time students at institutions of higher learning are required to participate in a qualifying student health insurance program, unless the requirement is waived because they have comparable coverage.

From 2007 to 2010 Aetna insured 30,000 college students at 13 Massachusetts colleges and universities-the top health insurer of students in the state, according to the Massachusetts Division of Health Care Finance and Policy.

In a marketing flyer aimed at college students state, Aetna claims that its policy would provide 100 coverage after an $8 to $10 co-pay or deductible for physician office visits - but it did not mention a general limitation on outpatient benefits, or one specific to physician office visits.

The policy actually covered only $1,500 maximum per covered accident or sickness for outpatient benefits, including office visits, according to Attorney General Martha Coakley.

Coakley says Aetna violated consumer protection laws by failing to disclose its significant limitations on plans, and by issuing policies that excluded coverage of pre-existing conditions without regard to prior coverage.In another flyer, the Hartford, Conn.-based insurer claimed: "Your school endorsed Student Health Insurance Plan offers you: Aggregate maximum of $500,000," though in fact the policy contained an aggregate maximum of $50,000.

Under the consent judgment decree, Aetna will pay a minimum of $500,000 to compensate consumers and $500,000 to the Commonwealth, and another $55,000 for the costs of the investigation.

Aetna must contact consumers who are entitled to relief.

Source: Courthouse News Service

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