(Bloomberg) Humana Inc. was sued by a Missouri man who claimed the insurer raised premiums for him and other customers and then failed to respond to requests to cancel policies, allegedly to increase revenue under the Affordable Care Act in what may be the first such lawsuit.
Hundreds of thousands of people received policy cancellation letters from insurers because their plans didnt meet requirements of the ACA that took effect Jan. 1.
The Obama administration in November asked insurance companies to notify consumers that alternatives existed under the health care law, including options that may have provided them tax credits and required the insurers to describe the ways the canceled plans dont meet the consumer protections required under the law.
Daniel Doyle of Missouri claims he sought to cancel his Humana health insurance policy after the company told him in August it was being replaced with one with a higher monthly premium. Erik Dirks, a lawyer for Doyle, said he believed the complaint filed Jan. 21 in federal court in Kansas City, Missouri, was the first of its kind against an insurer.
Humana continued to take automatic deductions from policyholders accounts and/or social security checks and/or Humana invoiced policyholders for alleged past due premiums, according to the complaint. Doyle seeks to represent Humana policyholders in 22 states who were unable to cancel policies.
A representative of Humana, based in Louisville, Kentucky, didnt respond to a voice-mail message left with the companys media office after regular business hours yesterday seeking comment on the lawsuit.
Doyle seeks a court order declaring Humanas practices violated consumer protection laws and forcing it to disgorge profit from the practice.
He said in his complaint that Humana didnt respond to his faxes or calls to an automated phone system seeking to cancel the replacement policy. A Humana representative reached by phone in January didnt have the authority to cancel the policy, according to the complaint.
The case is Doyle v. Humana Inc., 14-00061, U.S. District Court, Western District of Missouri (Kansas City).
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