HealthMarkets Inc. announced that its insurance subsidiaries have reached a comprehensive settlement with state insurance regulators leading a multi-state examination of HealthMarkets' insurance subsidiaries.“We have worked closely with insurance regulators during the multi-state examination and settlement process, and we understand our obligations to regulators, as well as our customers," said HealthMarkets chief executive officer Phillip Hildebrand. “In order to meet those commitments, we are improving company operations across the board. We are committed to serving the health insurance needs of individuals, families, the self-employed, and small businesses in a fully compliant manner.”
The settlement includes a $20 million penalty and the possibility for payment of an additional $10 million if the subsidiaries fail to meet the terms of the agreement. The settlement includes an outreach program to those insured by the companies prior to Aug. 1, 2005 regarding their coverage, implementation of changes in the way the company interacts with its insureds, enhanced support and management of agents, periodic self reporting for the next 18 months, and a follow up examination to begin no later than July 2010.
The settlement brings a close to a process begun in 2005 in which insurance regulators jointly examined the practices and processes of HealthMarkets' insurance subsidiaries. The examination report acknowledges that the companies have already implemented extensive changes that have addressed many of the concerns raised by regulators. Many of those changes were underway prior to initiation of the multi-state exam and a number of others were implemented soon after the examination began three years ago.
To date, 29 states have signed on to participate in the settlement agreement.
HealthMarkets is a provider of health and life insurance products to individuals, families, the self-employed and small businesses.
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