Oregon insurance regulators have set their sights of the Regence Group, which is part of the Blue Cross Blue Shield insurance group. Mike Kreidler, the state’s Insurance Commissioner, has accused the insurance company of several severe failures that have impacted the lives of thousands of policyholder and even people that are not affiliated with the company in any way. The violations are so serious that Kreidler has issued an order for the company to draft a plan to correct the issues, which is due by the end of this month.
Regence is being accused of charging consumers with premiums that are much higher than rates approved by the state, as well as withholding payments owed on thousands of claims and illegal withdrawals of funds from bank accounts owned by people that do not have insurance coverage through the company. These serious allegations are all spawned from the same source: The company’s “SurePay” system that allows consumers to make and receive automated payments. According to company officials, the system malfunctioned last month, drawing money from more than 6,000 bank accounts. A great number of these accounts, however, were never used to do business with Regence in the first place, sparking the intrigue of regulators.
Regence operates in four states, including Oregon, but did not report the failure of its computer system to regulators in any of the states in which it does business. In fact, regulators from Oregon were only made aware of the issue when they received complaints from consumers. Kreidler called a meeting of each state’s insurance regulators so as to form a plan of action in dealing with the company.
If Regence fails to submit a satisfactory plan to rectify the issue by the end of the month, regulators are expected to take bold actions against the company.
