Monday, May 12, 2025
DMHC Fines Anthem Blue Cross $750,000 for Sending Thousands of Denial Letters with Wrong Information
(Sacramento) – The California Department of Managed Health Care (DMHC) took enforcement action, including a $750,000 fine, against Blue Cross of California (Anthem Blue Cross) for sending thousands of denial letters to health plan members with the wrong regulator’s information concerning the members’ appeal rights.
“Health plan members have the right to request an appeal if their health plan denies, delays or changes their request for medical services,” said DMHC Director Mary Watanabe. “In this case, Anthem Blue Cross made it harder for thousands of members to request an appeal by sending incorrect information in the plan’s denial of care letters. In addition to paying the fine, Anthem Blue Cross has taken action to correct these serious errors.”
INDEPENDENT MEDICAL REVIEWS: California law requires health plans to provide information to health plan members on their right to appeal health plan decisions to deny, delay or modify requests for health care services or treatment, including how to request an Independent Medical Review (IMR). Health plans must also include the IMR application with the denial letter. During an IMR, doctors and health care providers who are independent and do not work for the health plan examine the case to see if the member should receive the requested service or treatment. If the IMR is determined in favor of the member's request, the plan must cover the service or treatment.
BACKGROUND: Through its pharmacy benefit manager (PBM), Anthem Blue Cross sent 5,252 denial letters to members with incorrect information on the regulator the member can appeal to if they disagree with the plan’s denial. The letters provided the wrong health plan regulator and contact information, including an IMR application to the wrong regulator. By failing to provide the correct regulator information, the plan created an obstacle for members seeking appeals.
During the DMHC’s investigation, the plan also admitted it was not monitoring or reviewing its PBM’s denial letters to the plan’s members. California law requires plans to ensure delegated, or contracted entities, are compliant with all of the requirements in the law including denial processes.
Anthem Blue Cross has implemented corrective actions to ensure accurate information is included in denial letters to members, and to monitor the plan’s delegates, including auditing denial letters to ensure accurate information is provided to members.
WHAT MEMBERS NEED TO KNOW: Californians enrolled in health plans regulated by the DMHC have the right to appeal their health plan's decision by applying for an IMR if their plan denies, changes, or delays their request for medical services, denies payment for emergency treatment or refuses to cover an experimental or investigational treatment.
Health plan members having trouble getting the care they need, should first file a grievance, sometimes called an appeal, with their health plan. If the member does not agree with their health plan's response or the plan takes more than 30 days to fix the problem in non-urgent cases, the DMHC Help Center can work with the member and health plan to resolve the issue. If a health plan member is experiencing an urgent issue, they should contact the DMHC Help Center at www.DMHC.ca.gov or by calling 1-888-466-2219.
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About DMHC:
The DMHC protects the health care rights of more than 29.8 million Californians and ensures a stable health care delivery system. The DMHC Help Center has assisted approximately 2.9 million Californians to resolve complaints and issues with their health plan. The DMHC Help Center provides assistance in all languages and all services are free. For more information visit www.DMHC.ca.gov or call 1-888-466-2219.