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As part of its recent settlement with the state of California, Anthem Blue Cross has agreed to pay a $1 million fine and take back 2,330 insurance customers it had dropped for submitting expensive hospital and doctor bills (i.e. for asking that their claims be paid by their insurance company). The company has also agreed to reimburse its dropped customers for the medical expenses they were forced to assume when their insurance quit on them.

According to Anthem Blue Cross estimates, the latter costs will total about $14 million.

“The settlement is a significant step toward ending rescission practices that can devastate consumers already weakened in their battle against illness,” Insurance Commissioner Steve Poizner said.

The settlement was far smaller than the $10 million settlement the company paid last July to a different state regulator, the Department of Managed Care, for another 1,770 members with health maintenance organization policies who were dropped for similar reasons.

Anthem said the consumers would be welcomed back within the next 90 days without strings attached. –AP

Anthem Blue Cross will still have to reckon with individual and class-action lawsuits on the part of dropped and no doubt indignant insurance customers, whether or not they’re welcomed back.

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