LTC insurer not paying up, lawsuit alleges

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California-based Consumer Watchdog has filed a class action lawsuit against Senior Health Insurance Company of Pennsylvania. The organization alleges that SHIP is refusing to honor thousands of long-term care insurance policies it sold across the state.

The suit charges that SHIP — which services policies that were originally sold by Conseco, American Travelers Life, Transport Life, United General Life, and Continental Life Insurance Company — is requiring policyholders to produce extensive documentation not required by the policy and requiring policyholders to undergo unnecessary medical examinations by personnel selected by SHIP.

The plaintiff in the lawsuit,  William Hall, M.D., is 87. The past chief of medicine at Kaiser Permamente Fontana Medical Center is also a former Army colonel.

“My Dad bought this policy to spare his children some of the time and expenses that many of our parents require when they get older, but SHIP has only drained my family's resources,” said son Eric Hall.

“SHIP's claim process not only violates California law, it violates the terms of the insurance policy that it sold to Dr. Hall,” said Hall's attorney William Shernoff. “Dr. Hall bought his policy in 1994. He paid the premiums on it promptly for 16 years. But when he finally needed the care he was entitled to, SHIP delayed his claims for eight months, and even then paid only 20% of what SHIP owed Dr. Hall.”

The result, Shernoff says, is that Hall had to pay tens of thousands of dollars in home health, “exactly the circumstances Dr. Hall sought to avoid.”

“SHIP is preying on society's most vulnerable. From the moment SHIP receives a claim for benefits, SHIP inundates its elderly policyholders with indecipherable correspondence, fictitious requirements, and needless demands for irrelevant information,” said Harvey Rosenfield, founder of Consumer Watchdog and counsel for Hall.
The company did not return calls for comments.