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Gianelli & Morris file class action complaint against Blue Shield of California

On February 6, 2019, attorneys Robert Gianelli and Timothy Morris filed a class action complaint in the Los Angeles County Superior Court alleging that Blue Shield of California violated California law by increasing health care premiums on its customers without proper notice as required by law. The case is MICHAEL BOLD, on behalf of himself and all others similarly situated v. CALIFORNIA PHYSICIANS’ SERVICE, INC. dba BLUE SHIELD OF CALIFORNIA, case number 19STCV03748.

This complaint was filed on behalf of all California subscribers of full-service Blue Shield individual or family health plans who received an untimely notice of an increased annual renewal premium in violation of the law, and who paid that unlawful premium increase. The lawsuit requests a declaration from the court that these premium increases are ineffective and not owed to Blue Shield. The lawsuit also seeks a preliminary and permanent injunction to keep Blue Shield from collecting premiums that were implemented in violation of the law. Further, the lawsuit is asking for restitution of premiums paid by customers which were improperly charged by Blue Shield.

Lawsuit alleges multiple violations of California law

According to the lawsuit, Blue Shield violated a number of different California laws in its conduct toward its policyholder, Michael Bold. For instance, the complaint alleges a violation of California Health and Safety Code 1389.25. This law clearly requires written notice of any change to the premium rate or coverage before such change can become effective. The required notice period is either at least 10 days before the start of the plan’s annual enrollment period or 60 days before the effective date of the plan’s renewal, whichever comes first.

In Mr. Bold’s case, open enrollment occurred between November 1 and January 31, but in order to renew a plan by Blue Shield’s renewal date of January 1, one would need to enroll by December 15. Under the terms of section 1389.25, the last day for Blue Shield to give notice of a change in premium was October 20 (ten days prior to the start of the enrollment period). Mr. Bold did get notice of a premium increase, but it was so outlandishly high that the Bolds knew it must be a mistake. They engaged in Blue Shield’s complaint process but were not able to get things straightened out until December 29, when they were finally notified of what the correct premium should be. Although the Bolds paid this amount, and their check was cashed by Blue Shield, Blue Shield still canceled the Bolds’ policy because they did not pay the outrageously high and admittedly incorrect premium. Given that the Bolds have two children with cystic fibrosis and cannot afford to be without health insurance for any period of time, these errors grieved them greatly and caused them to suffer serious damages.

Other alleged violations of the law include:

California Health and Safety Code 1365 – This law says a policy can’t be canceled for nonpayment of premiums until the customer has been duly notified and billed and at least a 30-day grace period has elapsed. This law was not followed when the Bolds’ policy was canceled.

California Health and Safety Code 1368 – This law requires health plans to have grievance procedures in place to handle customer complaints. The law is very clear on features of the grievance system which must be implemented. The lawsuit alleges Blue Shield did not properly handle the Bolds’ complaint as required by this law.

California Business and Professions Code 17200 – This law prohibits unfair, deceptive, untrue or misleading advertising; any unlawful, unfair or fraudulent business act or practices; and other prohibited acts. The lawsuit alleges that Blue Shield’s conduct toward Michael Bold and other class plaintiffs violates this statute.

If you were not provided with a timely renewal premium notice by Blue Shield and you paid a renewal premium in excess of the prior year’s premium, call the California insurance lawyers Gianelli & Morris at 866-353-7225 for a free consultation. You may be entitled to participate in this class action lawsuit and recover money damages for the harm done to you.

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