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What Do You Mean It's Not Covered: The Grounds for Cancellation

In cancelling Carolyn's coverage, Brennco cited three problems: (1) "History of fibroid uterus." (2) "Urinary incontinence." (3) "Severe dysmenorrhea" (pain during menstruation). The fibroids, benign growths, had been detected 11 years earlier; they eventually disappeared without treatment. The incontinence had occurred only a few times, during coughHH>ing fits she'd had during a series of respiratory infections. Her only enduring complaint was monthly cramps, and neither they nor fibroids nor an inconsequential loss of bladder control had anything to do with breast cancer. The Mountfords appealed Brennco's rejection. Carolyn's gynecologist explained in a letter that her March exam had been "entirely within normal limits" and showed "no chronic problems and certainly no preexisting conditions." The couple's insurance agent called the cancellation "irresponsible and unjust." He pulled other customers out of the plan and stopped selling third-party policies. Brennco didn't budge. In March 1990, the Mountfords sued Brennco and Boston Mutual. Lawyers for the companies did what defense attorneys always do in these cases: They argued that the policy was an employee benefit and therefore governed by ERISA. They lost on a technicality, which allowed the Mountfords to press for their unpaid benefits plus damages. The case settled eight months later for $90,000, roughly twice the medical bills. Brennco agreed to reinstate Carolyn. But the company's outrageous behavior continued. When the Mountfords first bought the Brennco policy, they'd paid a monthly premium of $164. After Carolyn was dropped, Fred's premium was $103. As the fight dragged on, his premiums soared -- to $398 in a year and a half. "Current premium levels are inadequate to support the level of claim payments," explained the company that had yet to pay a Mountford claim. In December 1991, when Carolyn returned to the plan, the premiums jumped to $753. In early 1992, they rose again -- to $956 a month. By early 1993, after a year on the waiting list, Carolyn got into the California Major Risk Medical Insurance Program, the state's health plan for the uninsurable.

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