Olympia, Washington — The Washington state insurance commissioner, Mike Kreidler, has imposed fines totaling $576,500 on various insurance entities for breaches of state insurance regulations during the months of October and November 2024. These fines were targeted at insurance companies, agents, brokers, and unlicensed groups who failed to adhere to legal standards.
In significant penal actions, PacificSource Health Plans received a fine of $100,000 for errors in processing insurance claims related to mental health and dietary consultations. The insurer was found to have wrongly charged co-pays, despite the policies explicitly stating that such services would not require co-pays if they were carried out virtually by network-affiliated providers. An investigation by the Office of the Insurance Commissioner (OIC) led to the reprocessing of 24 individual claims and unearthed 733 similar discrepancies, with adjustments amounting to over $85,000.
Furthermore, Delta Dental and its healthcare benefits manager, Wyssta, were collectively fined $130,000 for improper claim denials. The OIC’s scrutiny revealed that Delta Dental had employed unapproved terms in claim processing and had inadequately disclosed the role of its benefits manager, an action required by law. The review also pointed out unwarranted claim rejections based on undisclosed time and frequency restrictions for the services rendered, alongside delays in updating the firm’s website about its healthcare benefits manager.
Lemonade Insurance Company too faced a hefty penalty, getting fined $100,000 for self-reporting an erroneous application of base loss costs in property policies. This miscalculation, which pertained to policies issued from January through April 2022, led to refunds totaling $415,589 for 43,094 policyholders, which included compensations for accrued interest.
Notably, other organizations including Kaiser Foundation Health Plan, Asuris Northwest Health, and Capital Claims Management were also fined for a variety of regulatory non-compliance issues ranging from unauthorized practice to failure in satisfying required filing statuses.
These enforced fines augment Washington state’s general fund, which facilitates various public services for the residents. Since his tenure began in 2001, Commissioner Kreidler has accumulated over $42 million in fines through such regulatory actions.
This focus on stringent regulatory compliance underscores Washington state’s commitment to ensuring fair practice in the insurance industry, safeguarding consumer rights against corporate malpractices.
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