Pa. Insurance Department recovered more than $18M for consumers in 2022

HARRISBURG – Pennsylvania Acting Insurance Commissioner Michael Humphreys on Tuesday announced the Pennsylvania Insurance Department (PID) reclaimed more than $18 million in 2022 for nearly 75,000 consumers who had funds stolen, payments improperly processed, or other forms of restitution or credit due as a result of company errors or unethical conduct.

In his budget address, Gov. Josh Shapiro voiced concern over the effective enforcement and compliance of mental health parity laws in the country. Shapiro has directed Humphreys to make mental health parity a true reality in Pennsylvania and to hold insurers accountable so that mental health benefits are covered fairly.

"The comprehensive market conduct exams of our largest health insurers focused on making sure consumers receive mental health and substance use disorder care coverage at parity with medical and surgical coverage, as required by state and federal law," said Humphreys. "Gov. Shapiro knows that mental health and substance use disorder care benefits are critical protections for consumers, and PID will make every effort to ensure that Pennsylvanians are receiving the benefits that they are entitled to."

During 2022, approximately 75,000 consumers around Pennsylvania received some form of reimbursement, restitution payment, or credit, resulting from the department's efforts across all lines of insurance. Below are some examples:

Reprocessing of claims that were improperly handled, in many cases due to financial requirements and visit limits that were not compliant with mental health parity laws and regulations;Restoration of stolen funds when an agent collected payment from a consumer for a policy or annuity but did not send the money to the insurance company;Refunding of copays, and payment of previously denied or underpaid claims when a company did not pay a claim as it should under the consumer's policy, andRefunding of overcharged premiums when an insurance company was found to be charging premiums above the rate that had been approved by the Pa. Insurance Department.

Humphreys added that in some cases, the department's findings can result in additional penalties against the offending insurance provider. For example, after thorough examinations and investigations, the department issued more than $960,000 in enforcement penalties for violations of Pennsylvania's insurance laws in 2022.

"PID works diligently to hold insurance licensees accountable to Pennsylvania's consumers, and to ensure that consumer rights and protections guaranteed by state laws and regulations are upheld to the highest standards," said Humphreys. "Predatory practices will not be tolerated, and we will continue our work to ensure that consumers get the coverage they deserve, at the prices they have agreed to pay."

To date, approximately 60,000 Pennsylvanian consumers have received a cumulative $5.87 million in restitution as a result of the department's ACA market conduct examinations since 2018, when the first exam was finished.

The Pa. Insurance Department also helped provide more than $165 million in benefits to 6,425 Pennsylvanians last year through participation in the National Association of Insurance Commissioners' Life Insurance Policy Locator Service. Established in 2016, this service helps consumers locate lost life insurance policies and annuity contracts of deceased loved ones.

PID is charged with upholding fair business practice standards for consumers, companies, and insurance professionals to ensure that consumers in Pennsylvania receive all protections to which they are entitled under the state's laws and regulations. This work involves researching and resolving complaints from consumers, investigating allegations of misconduct from insurance companies, agents, brokers, and others, and ensuring that practicing professionals are properly licensed.

Consumers who have a question about their insurance or need to file a complaint may contact the Insurance Department's Bureau of Consumer Services at 1-877-881-6388 or online.