By the Numbers: DMHC Enforcement Actions Against Insurance Companies in 2025 (So Far)
The California Department of Managed Health Care (DMHC) licenses and monitors health plans operating in the state. The DMHC Office of Enforcement works to change plan behavior to comply with the law, utilizing enforcement actions including cease and desist orders, administrative penalties (fines), freezing enrollment, and requiring corrective actions. In some cases, the DMHC pursues legal action against health plans to ensure they follow the law.
At the time of this writing, DMHC has already issued 169 enforcement actions against health insurers since the start of the year. Read on as we describe the most prevalent failures and missteps insurance companies seem to be making month after month. If you have experienced mistreatment at the hands of your insurer, including unreasonably long delays in processing a claim or a claim denial for unfounded reasons, contact Gianelli & Morris to speak with an experienced California insurance bad faith attorney.
DMHC Enforcement Actions by the Numbers
By May 8th, the DMHC had issued 169 enforcement actions against health insurance companies operating in California. While some insurers turned up more than most, such as Anthem and Kaiser, virtually no major insurance company was spared. Insurers on the receiving end of administrative penalties and cease and desist orders included Anthem Blue Cross, Blue Shield of California, UnitedHealthcare, Health Net, Aetna, Sutter Health, Kaiser Permanente, L.A. Care, Scripps, Delta Dental, Oscar, Cigna, and many others.
The chief tool wielded against these recalcitrant insurance companies was monetary fines. Penalties so far this year have been as low as $10,000 and as high as $550,000. Although many penalties are assessed at $10,000 or $20,000, a sizeable number of the more than 160 fines ranged between $70,000 and $100,000. In several instances, an enforcement action included several violations with multiple penalties.
Types of Violations
The DMHC Office of Enforcement maintains 31 different categories of violations, but a few categories stand out as the cause for enforcement actions. These categories are: Grievance and Appeals, Claims, and Independent Medical Review.
Grievance and Appeals
A staggering 111 out of 169 enforcement actions included violations in the Grievance and Appeals category. Leading violations in this category included:
- Failure to resolve a grievance within 30 days
- Failure to provide written acknowledgment of receipt of a grievance within five days
- Failure to adequately consider a grievance
- Failure to establish and maintain an approved grievance system
- Failure to notify parties of a grievance disposition involving a serious health threat within three days
Policyholders with grievances against their insurer often have their healthcare put on hold, delaying urgent or necessary medical care until the matter is resolved. These requirements are in place to ensure that complaints are heard and resolved promptly.
Claims
Thirty enforcement actions issued since the start of the year involved claims processing violations. These errors included:
- Failure to provide an accurate and clear written explanation of the specific reasons for denying, adjusting or contesting a claim within required timeframes
- Failure to timely reimburse, contest, or deny a claim
- Failure to reimburse a claim as soon as practical up to 30 working days (or 45 days if the insurer is an HMO )
Independent Medical Review
Independent Medical Review (IMR) is a process where independent medical professionals review decisions made by insurance companies regarding whether a proposed treatment is medically necessary or appropriate. Insurers often deny a medical procedure or service recommended by the insured’s doctor by claiming it is not medically necessary or another available treatment is better. In our experience, the reason for such denials is often based on cost savings for the insurer and not what is in the patient’s best interest. IMR is a way for a third party to take a look at the case and render an opinion on whether the requested service should be approved or not.
Of the 169 enforcement actions issued by DMHC against insurance companies so far this year, ten of them included IMR violations. These breaches included:
- Failure to submit a complete and legible copy of all medical records and other information used to make a decision regarding a disputed health care service
- Failure to promptly implement the decision of the DMHC following the review process
- Improperly engaging in conduct that prolongs the independent review process or prolongs implementation of the DMHC’s decision
- Failure to provide additional medical records or other information requested by the IMR organization within five business days in routine cases or within one calendar day in expedited cases
Other Violation Categories
Some of the other violation categories that have made repeat appearances so far this year include Surprise Billing, Utilization Review, and Timely Access. Timely Access rules are in place to ensure a provider network has the capacity and availability to offer appointments within ten business days of a request and arrange for medically necessary services outside of the network if the service is unavailable within the network. The DMHC found many failures of insurance companies to provide timely access.
Anthem Blue Cross was also fined for failure to publish and maintain a provider directory that policyholders could use to find healthcare, including listing which providers accept new patients. Without taking even this most basic step, insureds are left without the ability to access healthcare and make use of the insurance coverage they are paying for.
Contact Gianelli & Morris for Help With Unfair Claim Denials in California
Filing a grievance with your insurer is one way to resolve a dispute, and escalating the matter to the DMHC is another way to advocate for yourself. Another step to take is to contact an experienced insurance law attorney who can work to hold the insurance company accountable for the harm their wrongful actions have caused, including recovering compensation for your medical expenses and pain and suffering, and recovering punitive damages in cases of insurance bad faith. Contact Gianelli & Morris for a free consultation. We’ll take a look at your situation and advise you on your options.
