The story I’m about to tell you is true. The names have been removed to protect the innocent as well as the guilty. We will call the company in question InsCo. Many of you have probably read similar case studies as examples of how broken businesses can be. Let’s have a look at the original complaint letter.

I left my previous employer on January 9th, 2007. Before leaving with them we discussed insurance. They had already paid January’s premium and contacted InsCo to verify that my coverage would continue until January 31, 2007.

I placed a few claims in the month of January. My wife’s claim on 1/23/07 was rejected for the reason of “health plan coverage ended before you received these services.” However, I had two claims on 1/30/07 and 1/31/07 which were paid. After contacting InsCo, they claimed my coverage ended the 9th. Despite the fact I pointed out that they covered me on the 30th and 31st they were adamant that my coverage ended the 9th. I said this was a mistake and I would check with my employer.

I checked with my employer and they verified that they had an agreement with InsCo that kept my coverage until the 31st. They then called InsCo (different support department) and InsCo verified this again. I called InsCo back and got the same denial message. I then mentioned to them that my employer had just gotten off the line verifying my coverage to which they had no response. I asked for who they needed to contact to verify/ensure my coverage, I was given a fax number.

My employer then faxed a letter verifying that my coverage should have extended to the 31st. The fax was sent successfully and the next day my employer received a monthly confirmation with my term end date of Jan 31. I then called back and informed them of this they are still denying the claim.

My employer has since faxed them another copy this time with the specific claim ID listed that they are denying. I do not know if InsCo is purposely trying to defraud me or if they are just criminally negligent. This is not the first time I’ve received this sort of treatment. When originally signing up with their service nearly four years ago I had the same run around and was only able to resolve it after sending them registered mail which they could not deny receiving.

I was just contacted by the doctor whose claim was denied saying that they contacted InsCo who informed them that our PPO account was terminated on the 9th and that we had an HMO until the 31st. We have never had an HMO plan through InsCo.

I know dozens of people deal with this sort of treatment a day. It is an insult to human decency whether it is intentional or not.

Interesting side-note. If my coverage was in fact terminated on the 9th I am due a refund for the premium which would be much greater than the claim in question.

After going over the complaint letter I was curious to the extent of the problem. After consulting with the customer in question I got an additional level of detail. They mention in the letter that they’ve dealt with similar service before and this becomes very evident. They had kept a detailed log of the call process to InsCo as they tried to get this resolved.

• Call InsCo to inquire on claim not covered informed plan ended on the 9th. (10 minutes)
• Call previous employer to double check they hadn’t done anything wrong verified they filed for plan termination on 31st (5 minutes)
• Call InsCo discuss problem. Informed employer is wrong given special number to extend plan. (15 minutes)
• Call employer discuss employer finds latest statement from InsCo showing coverage for account until the 31st. This statement was printed AFTER the 9th. (10 minutes)
• Employer calls their InsCo support number to discuss problem InsCo verifies that coverage should extend to the 31st (30 minutes)
• Call back InsCo support armed with new information given exactly the same response. Ask why their corporate support is saying the opposite of individual support. No answer. Asked why not answering reply: ” I don’t know.” Given fax number to send statement and request to extend coverage (15 minutes)
• Employer faxes relevant documents to fax number. (5 minutes)
• 2 days pass
• Call back to verify claim will be processed claim is still denied. After asking why get informed that coverage ended on the 9th. (15 minutes)
• Hang up and call same support number back to get a different CSR explain in detail steps that have been taken so far. CSR is very friendly and tries to investigate. She finds some information! It seems like in June an HMO account was created in addition to the existing PPO account. The PPO account was cancelled on the 9th the HMO continues to the 31st. (45 minutes)

  Note: Neither customer or employer EVER knew about the HMO plan nor was it requested.

• Customer gives up on InsCo takes matters into his own hands contacting the BBB and providing the claimant doctors with the HMO number. Claim is filled and immediate problem is resolved through no work on InsCo’s part (2 minutes)

I don’t think I need to illustrate how ridiculous a problem like this is but I’m going to anyway. There were somewhere around 9 points of contact with the customer that failed to resolve the problem. The fact that each of these Moments of Truth failed is indicative of larger problems. I’m not sure I can even assign a number to the amount of breakpoints that occurred. Clearly department to department communication is either broken or non-existent.

Perhaps all of this mess could have been avoided with just one change. For some reason the customer’s account was duplicated in June for reasons unbeknownst to the customer and their employer. If there had been notification to that event or if that event had simply not happened at all it’s likely the customer would have had no cause to complain. We can’t know if this was a business rule or simply a clerical error from our perspective. The fact is that’s not even relevant. Whatever the cause the customer sees the same failing outcome.

What else could be done to help the customer achieve success in this situation? We all know errors happen so let’s assume for a minute that this same problem had occurred but the CSRs had been empowered with the access to information they needed. On the customer’s first call a CSR should have been able to see what had happened previously and the information should have been consistent with what the other departments were seeing. For some reason the corporate level support and the personal level support were seeing the same account but very different information. This caused the back and forth between InsCo Customer and Employer and resulted in nothing but wasted time. Finally the customer happened to come upon a CSR that was able to dig into the problem at a level that was either unavailable or undesirable to the other CSRs. This should have happened on the first call and there is no reason it should have taken 45 minutes.

In the end InsCo is left with a completely unsatisfied angry customer. Despite having encountered a friendly and helpful CSR at the end there is no resolution and the customer is left feeling outright cheated even defrauded. It would have been a trivial matter financially for InsCo to fill the claim in fact it would have been less than the amount of premium already paid for the month of January. Couple that with the fact that the customer had to spend the better part of a workday to solve the problem themselves and you can’t help but wonder what is being done with the premium they paid on a monthly basis.