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10 Great Moments in Corporate Malfeasance


7
WellPoint's Breast Cancer Algorithm
In 2010, a Reuters article stated that WellPoint Insurance Company dropped women from coverage when they were diagnosed with breast cancer.
In 2010, a Reuters article stated that WellPoint Insurance Company dropped women from coverage when they were diagnosed with breast cancer.
ŠiStockphoto.com/monkeybusinessimages

The debate over U.S. health care reform that raged in 2010 shed a spotlight on health insurance companies, and not all of them stood up to the public scrutiny.

One notable example is WellPoint, one of the nation's biggest insurers, which turned out to have created an algorithm that flagged the accounts of women who were diagnosed with breast cancer. Called recission, or the policy of finding ways to cancel contracts, this common cost-saving measure had never before been so egregiously abused by an insurance company. A federal investigation of a number of women whose policies had been discontinued for various reasons shortly after they were diagnosed uncovered the abuse.

Under WellPoint's policy, a breast cancer diagnosis meant a woman's policy was flagged for investigation. It would be searched for any type of error, including clerical errors, which would then be used to revoke the patient's insurance coverage [source: Reuters]. Health and Human Services secretary Kathleen Sebilius quickly wrote a letter taking the company to task for the practice, which was technically legal.

In a response to Sebilius' letter, the company denied the accusation [source: Weaver].


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