emergency medical – OLHI – Free, impartial help with your life & health insurance complaints

What is a “pre-existing” condition? (travel)

Posted on: February 2, 2016

Mr. Z. purchased out-of-Canada emergency medical expense insurance in connection with a trip to the U.S. While there, he needed medical treatment for a kidney stone and, afterward, submitted a claim to the insurer for the expenses he incurred.

The claim was denied because his U.S. hospital records noted that he had experienced flank/back pain a week before his departure and he had not disclosed this to his insurer before traveling.

The exclusions section of his policy denied coverage for any sickness, injury or medical condition, occurring before the date he left on his trip, which was expected to lead to treatment or hospitalization. In sum, the insurer believed that Mr. Z. had a “pre-existing medical condition” that he was required to tell them about before traveling. All travel insurance contracts contain a clause of this nature; however, the exact disclosure requirements vary from contract to contract.

Mr. Z. appealed the denial and followed the insurer’s complaint process, where the decision was upheld by the insurer. He then submitted his complaint to OLHI for review.

With both the details provided by the consumer and the insurer’s file in hand, OLHI’s Dispute Resolution Officer (“DRO”) reviewed the case and concluded that the denial was entirely based on statements contained in the U.S. hospital records regarding prior back/flank pain. The DRO found that there had been no contact initiated by the insurer with either the U.S. hospital or the consumer. He also observed that the U.S. hospital notes stated that the consumer had experienced pain one week prior, that went away, and, in direct contradiction, that Mr. Z. had experienced “unremitting flank/back pain” for the entire week prior to his departure.

Although the insurer’s Ombudsman had suggested that the claim be paid, the business unit declined the claim.

OLHI’s DRO expressed doubt about the accuracy of the U.S. hospital records and suggested that this could be the basis for OLHI to approach the insurer. It was recommended that the complaint be escalated to an OLHI OmbudService Officer (“OSO”) for further investigation.

The OSO spoke with the consumer directly and learned that he had made no mention whatsoever of any “flank pain” but that the back pain he had experienced one week prior to departure went away on its own with over-the-counter pain relief and a warm bath. Our OSO also reviewed the documents provided by the insurer, including the insurer’s claims review process documents. His findings echoed those of the insurer’s Ombudsman.

In his submission to the insurer, the OSO highlighted the incongruities in the U.S. hospital records. He suggested that the policy exclusion could not be fairly invoked given the fact that Mr. Z.’s prior back pain had gone away with a warm bath and an over-the-counter pain reliever. He also suggested that it was improbable that anyone with constant, severe pain leading up to this trip could travel anywhere and hence the unreliability of the U.S. hospital admission record. The OSO recommended that the insurer reconsider its’ decision.

The insurer thanked the OSO for his comprehensive review and supported OLHI’s recommendation to pay this claim. The consumer‘s claim was paid shortly thereafter.

Disclaimer: Names, places and facts have been modified in order to protect the privacy of the parties involved. This case study is for illustration purposes only. Each complaint OLHI reviews contains different facts and contract wording may vary. As a result, the application of the principles expressed here may lead to different results in different cases.

Full disclosure (travel)

Posted on: February 2, 2016

Mr. M. called OLHI after he received a letter from his wife’s insurer turning down her travel insurance claim. He and his wife had purchased out- of- country emergency medical and hospital insurance to cover them for an upcoming trip to the U.S. The insurance was bought over the phone and medical questions answered orally by both Mr. M. and his wife.

Unfortunately, Mrs. M was admitted to hospital and underwent emergency heart surgery while on vacation. When she returned home, she submitted a claim to the insurer for her U.S. medical and hospital expenses. These expenses were significant as Mrs. M. had spent over two weeks in hospital. The insurer denied payment for the claim on the basis that Mrs. M. had failed to fully disclose her medical history. Mr. M. contended that his wife had disclosed all necessary medical issues.

Since the insurer had issued its final position letter, our Dispute Resolution Officer (DRO) advised Mr. M. that OLHI could open a complaint file to determine if there were grounds to review the insurer’s decision. To start the process, Mrs. M. was asked to sign and submit OLHI’s standard Authorization form and all relevant documents, including a copy of the insurer’s final position letter.

During the initial call to OLHI, Mr. M. asked if his wife’s claim was subject to a “limitation period” – that is whether there was a time limit to start a legal action against the insurer to recover his wife’s expenses. He was told that the running of the limitation period was suspended while his complaint was under review by OLHI. He was advised to consult a lawyer if he had any concerns about what limitation period applied to his wife’s claim since OLHI could not provide legal advice.

In accordance with industry standard practice, once Mrs. M. filed a claim, her insurer obtained copies of her medical records. These records were provided to the insurer pursuant to a written consent signed by Mrs. M. at the time she filed her claim. The insurer forwarded copies of these medical records to OLHI once Mrs. M.’s complaint file was opened.

Upon reviewing Mrs. M.’s medical records, our DRO learned that Mrs. M. had seen her family doctor on three occasions just before she bought her travel insurance. These visits were made to address complaints of chest pain. A follow up test booked by her physician to investigate the symptoms was cancelled by Mrs. M. until she returned from her vacation. However, when she bought her travel insurance, Mrs. M. had told the insurer that she had not seen a doctor for “any reason that was not routine within the last 12 months”. In sum, the insurer had turned down Mrs. M.’s claim for reimbursement of expenses because she was under investigation for a pre-existing medical condition within that period.

Mrs. M.’s position was that the three visits she made to her doctor were in connection with a “minor ailment”, which was permitted under the policy. She argued that she had no “pre-existing medical condition” nor were her visits to the doctor made in connection with such a condition. The policy defined “minor ailment” as one that did not require more than one follow-up visit with her physician.

OLHI’s DRO concluded that Mrs. M. did not have a minor aliment because her condition required two follow up visits. As a result, the “pre-existing conditions” clause of the policy applied. This meant that she was required to disclose her full medical history to her insurer, including any and all consultations with doctors for “non routine reasons” within 12 months.

In the final analysis, Mrs. M. did not disclose her full medical/health history when applying for travel insurance and the insurer had legitimately turned down her claim for payment. Mrs. M. was advised that there were no grounds for OLHI to review her complaint with the insurer and her OLHI complaint was closed.

Coverage uncovered (travel)

Posted on: February 2, 2016

An Ontario couple planned a trip to Peru for 20 days, with a departure date of April 18th, 2010. The trip included air fare and a package tour throughout the country. Total cost exceeded $9,000 for two persons and was pre-paid.

At the time of booking, they purchased insurance coverage for the following risks: trip cancellation & interruption, emergency medical, baggage & personal effects, flight accident and travel accident. The contract covered re-imbursement for “the unused portion of pre-paid travel arrangements.”

They departed on April 18th as planned. Unfortunately, the husband immediately fell ill upon his arrival in Lima, Peru and was hospitalized on April 19th. He was diagnosed with a heart problem and remained in hospital for 9 days until his condition was stabilized and he was able to return home to Canada with his wife. Unfortunately, as a result of his hospitalization, the couple was unable to participate in the country wide tour they had previously booked since it departed from Lima on April 20th.

While her husband was in hospital, the wife was required to obtain hotel accommodation in Lima. Naturally, they also incurred a variety of medical and related expenses associated with the husband’s hospital stay.

Shortly after their return to Ontario, the couple submitted a claim under their travel policy. The insurer denied a large portion of their expenses and issued a letter stating that the loss was not fully covered under the insurance policy. In its letter, the insurer quoted the following policy provision: “What is not covered? … 2. This insurance does not cover any loss, claim or expense of any kind caused directly or indirectly from: c) pre-paid travel arrangements for which an insurance premium was not paid”. The insurer further stated that the couple’s insurance policy limited them to a maximum reimbursement of $400 per person for pre-paid travel arrangements.

Upon receipt of the insurer’s letter, the husband contacted the insurer through its call centre asking why he did not have coverage for the total cost of the pre-paid travel expenses. The representative could not satisfy his enquiry and after several unsuccessful calls to the insurer, the consumer called OLHI.

In accordance with OLHI’s process, his call was promptly routed to a Dispute Resolution Officer (DRO) for assistance. She discussed the facts giving rise to the claim with him, as well as the insurer’s position as described in its letter. From their conversation, she concluded that the “What is not covered” section of the contract quoted by the insurer in its letter did not apply in these circumstances because the consumers had purchased a travel policy that covered all risks, including the “unused portion of pre-paid travel arrangements”.

Our DRO advised him to respond to the insurer’s letter in writing, including the documentation requested by the insurer and references to the terms of his policy applicable to his claim.

Based on our DRO’s advice, the husband sent a letter to his insurer on July 28th. A few weeks later, she received a call from the husband thanking her for her assistance and confirming that he had received a reimbursement of more than $9,000 from the insurer.

As they talked further, it appeared that an administrative error had been the cause of the earlier denials by the insurer. Once the consumer wrote back, quoting the nature and the types of coverages he had contracted for as recommended by our DRO, the error was quickly identified and the claim was promptly paid by the insurer.