Still a bad deal

Sunday, Feb. 3, 2008 | 2 a.m.

UnitedHealth Group, which stands to capture a significant portion of Nevada’s health insurance market, is facing up to $1.3 billion in fines in California in connection with charges that it mishandled more than 130,000 claims.

As the Las Vegas Sun reported last week, the alleged violations by UnitedHealth’s California PacifiCare companies include wrongfully denying claims, making incorrect claims payments, losing medical records and asking repeatedly for documentation that had already been provided to the insurer.

The allegations are particularly troubling in light of the fact that UnitedHealth wants to take over Sierra Health Services, which covers about 630,000 Nevadans and is the state’s largest insurer. The U.S. Justice Department is investigating the proposed $2.6 billion deal to determine whether it would hurt competition.

California isn’t the only state in which UnitedHealth’s practices have raised concerns. As reported in the Sun, state insurance officials in Arizona, Nebraska and Texas have all fined UnitedHealth for violations similar to the California allegations.

UnitedHealth spokesman Tyler Mason told Sun reporter Marshall Allen that the California problems would have no effect on the company’s operations in Nevada, because Sierra health would remain in control.

Right.

It would be naive to think that UnitedHealth would seek to dominate the Nevada health insurance market without bringing its corporate culture and administrative processes with it.

We remain steadfast in opposing this merger, a deal that would stifle competition and place Nevada’s health insurance market in the hands of a company that continues to have significant regulatory problems.