Insurance Case Became Ordeal

What went wrong?

Why did John B. Wickman and his wife have to go through such an insurance ordeal for months, after 29 years of coverage with their employer, Unocal, and 28 years with the same insurance administrator, Prudential Health Care?

For Wickman, who retired last year but continued coverage through the company, the trouble began with the discovery of his wife Michael’s lung cancer in April and an operation for it in May.

After so many years of coverage, including no previous medical crises, according to Wickman, suddenly his claims were denied.

In numerous calls to Prudential’s customer service lines, and finally to Unocal’s benefits administrators, the Las Vegas residents were uniformly told that they had coverage.

But after they submitted bills for more than $90,000 for lung cancer treatment, this message from Prudential kept getting stamped on each of the Wickmans’ claims:

Our records indicate this patient was not enrolled for coverage under the plan at the time this charge was incurred. Therefore, no benefits are payable.

“The customer service people were nice as could be,” John Wickman recalled. “They said this was a shame. But they weren’t able to do anything about it.”

It seems to be corrected now. Prudential has sent the Wickmans a certified letter saying the claims are being paid, with apologies.

“We feel terrible that this occurred,” said Prudential spokeswoman Peggy Frank Lyle.

“We regret what’s happened here,” said Unocal spokesman Barry Lane.

What a gruesome experience this was for the Wickmans: not only to have the shock of a lung cancer diagnosis and major surgery, but then to be told that Prudential--which advertises “Choose the Rock and Be a Winner”--was refusing to pay any of their medical expenses.

What really caused this to happen?

The answer remains murky--and unsatisfying--at best.

Prudential lawyer Denise Louie suggested: “We may have computer systems that aren’t talking correctly to each other.”

Even corporate spokeswoman Lyle wasn’t buying that.

“That’s a really easy save, but I don’t know that that’s true,” she said. “It’s easy to blame an inanimate object.”

I asked the director of computer analysis at The Times, Richard O’Reilly, whether computers could on their own be to blame.

“It’s never the computer’s fault,” he said. “The computer’s just a machine that does what humans instruct it to do.”

It’s clear, moreover, that Prudential customer service was not at all diligent in resolving the problem. Or perhaps they were overwhelmed by their workload.

John Wickman also talked, on July 13, to David Ross, identified to him by the customer reps as supervisor of claims for the company.

Ross, he said, told him that he would “walk it through personally” and advised him to call back at 3 p.m. that day.

But when Wickman called back, Ross was not at his desk. And for the next three days his voicemail box was full.

Finally, on July 17, Wickman was able to leave a voicemail message for Ross. But he never called back.

Fortunately, Ross called me back.

“I’m not a supervisor, I’m just a senior representative,” he said. “I don’t process any claims. I just tell [the claims department] what is right and wrong.”

Tellingly, Ross added, “These cases come up daily and our voicemail is full every day.”

So, maybe the Wickman case was not all that exceptional.

Lyle said a team of people from Prudential was working to find out what went wrong with the handling of the Wickmans’ claims. But days passed without a full answer.

In the meantime, she put part of the blame on Unocal.

“A very simple solution would have been for Mr. Wickman to have gone to his company and have the benefits person contact the account manager on our end,” Lyle said. “But Unocal called customer service, and that was the one entity that wasn’t responding.”

Not so, said Unocal spokesman Lane.

“We took action with the proper person at Prudential,” he said. “Prudential assured us the matter would be handled.”

After Wickman first contacted Unocal on June 23, Lane said, “we contacted Prudential no less than seven times and sent two faxes.” It still took Prudential weeks to rectify matters.

Lane disclosed that even before the Wickman case, Unocal was having “problems” with Prudential.

“Cigna is replacing Prudential as our medical claims administrator effective Aug. 1,” he said. “We conducted an evaluation of the claims process last year and out of that Cigna was selected.”

In the wake of the Wickman episode, he said, monitoring was intensified and the accounts manager Unocal contacted was in frequent return touch with Unocal.

In fact, on the very day Lane was talking to me he said the Prudential manager asked Unocal three times if there were any other Wickman-type cases.

It sounds as if Prudential is anxious to avoid repeats.

And that is all to the good. Because a lawsuit would not have been a real option for the Wickmans had Prudential held firm to its position denying their claims.

Jamie Court of the Consumers for Quality Care organization pointed out that the so-called

ERISA exemption would have severely limited their rights to sue.

The courts have held that under the Employee Retirement Income Security Act of 1974, enrollees in employer plans cannot sue for bad faith, general damages and punitive damages against such firms as Prudential. They can recover only the cost of the benefit denied.

Fortunately, Prudential did not seek to fall back on these limits as defined by the courts and a Congress that so far has proved unable to alter the unfavorable balance between insurers and patients.

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Ken Reich can be contacted with your accounts of true consumer adventure at (213) 237-7060, or by e-mail at ken.reich@latimes.com.