Louisiana health groups file lawsuit concerning health insurance

Insurance Commissioner Jim Donelon - Insurance News
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Health groups argue Insurance Commissioner overstepped boundaries in regard to health insurance laws

Two health care groups in Louisiana have filed a lawsuit against Insurance Commissioner Jim Donelon concerning his actions in the wake of Hurricane Isaac. The groups – Louisiana State Medical Society and the Louisiana Hospital Association – argue that the Insurance Commissioner exaggerated his authority as a response to the natural disaster. The lawsuit cites the changes the Commissioner made to health insurance regulations and coverage due to an emergency ruling that granted him with expanded authority.

Emergency rule the crux of legal action

The emergency rule was enacted by Commissioner Donelon on September 4. According to the rule, those affected by Hurricane Isaac were able to seek out-of-netwrok medical care if they needed to. Commissioner Donelon claims that this was to address an issue in which many victims were left stranded by the disaster with no wInsurance Commissioner Jim Donelon over health insurance lawsuitay to obtain care from in-network providers. With limited options, Donelon made it possible for these people to receive the care they needed through out-of-network providers. According to the health care groups, this directly affects the contracts providers have with insurance companies and could lead to problems in reimbursement and other charges.

Lawsuit claims changes to existing health insurance laws were made unjustly

The lawsuit claims that the Insurance Commissioner attempted to enact a new law through the emergency ruling and that this action has negatively affected the rights of doctors and other medical professionals. Commissioner Donelon was granted the ability to make changes to insurance regulations through emergency rules by Governor Bobby Jindal. Though these emergency rulings are limited in scope, the lawsuit claims that Donelon’s actions have made serious changes to existing insurance laws.

Emergency rule not focused entirely on health insurance

The emergency rule is not focused solely on health insurance in Louisiana. The rule also prevents property insurers from canceling policies because of claims related to Hurricane Isaac. The rule also provides consumers with extensions concerning premiums, granting them some leeway in paying the rates on their policies while they attempt to recover from the natural disaster.

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