September 12, 2024
OLYMPIA, Wash. — Washington state Insurance Commissioner Mike Kreidler fined LifeWise Health Plan of Washington and Evolent Health LLC a total of $225,000 for incorrectly processing, and automatically denying, health insurance claims based on the patient’s gender.
Kreidler fined LifeWise $150,000 and fined Evolent — LifeWise’s health care benefit manager — $75,000 in orders filed on Sept. 12, 2024. Health care benefit managers are third-party professionals or entities who act as intermediaries between insurers, providers and patients, often making determinations on whether services are covered or not by the patient’s plan.
“Carelessness from health insurers and their benefit managers can cause significant stress and harm to their enrollees,” Kreidler said. “Our state laws are designed to hold insurance companies accountable for their mistakes and their representatives’ mistakes.”
A patient filed a claim for covered reproductive health services with LifeWise in March of 2022 and received a denial a week later, with LifeWise telling the patient that the procedure was not typical for their gender and that additional medical records would be needed to reprocess the claim.
The provider’s office contacted LifeWise about the claim and got the same response, and the patient contacted LifeWise twice more in November of the same year — to no avail — before contacting the Office of the Insurance Commissioner.
Four days after the patient filed a complaint with the OIC, LifeWise informed the patient their claim would be reprocessed and paid.
“A patient shouldn’t need to spend the better part of a year asking their insurance plan to correct an error,” Kreidler said. “Providing them with an explanation that breaks Washington state law is unacceptable.”
The OIC requested LifeWise review its similar claim denials from the two previous years and found 40 claims (27 unique claims and 13 resubmitted claims) had been improperly denied due to gender-specific coding, with a total billed amount of $318,781.83. The total allowed amount for the 27 unique claims was $17,821.29. The impacted claims were reprocessed and paid.
Thirty-one of those 40 claims were denied by Evolent, which was acting on behalf of LifeWise.
The original patient filed another complaint against LifeWise in January of 2023 alleging another denial due to their gender not aligning with the gender-related procedure codes. LifeWise corrected that claim that same month.
State law bars health plans from issuing automatic denials — or denying or limiting coverage — for reproductive health care services that are ordinarily, or exclusively, available to individuals of one gender if the patient is of a different gender. Health plans are also legally responsible for the activities of their health care benefit managers.
About the OIC
Kreidler’s office oversees Washington’s insurance industry to ensure that individuals, companies, agents, and brokers follow state laws designed to protect consumers. Since 2001, Kreidler has assessed more than $41 million in fines, which are directed to the state’s general fund to pay for state services.
For an insurance question or complaint, contact Kreidler’s consumer advocates online or by phone at 800-562-6900.