Washington State Insurance Commissioner Mike Kreidler issued a total of $576,500 in fines to insurance companies, agents, brokers, and unlicensed entities for violating state insurance laws and regulations in October and November 2024.
Among the largest fines were $100,000 levied against PacificSource Health Plans for improperly processing claims, $130,000 against Delta Dental and its healthcare benefits manager, Wyssta, for improper claim denials, and $100,000 against Lemonade Insurance Company for using an incorrect base loss cost in property policies.
PacificSource Health Plans was fined $100,000 for improperly processing claims for mental health and dietician treatments. The insurer charged unnecessary co-pays despite the consumer’s policy stating that such services would be covered without a co-pay if performed virtually by in-network providers.
After the Office of the Insurance Commissioner (OIC) investigated, the company reprocessed 24 claims for the consumer and identified 733 other cases, totaling over $85,000 in cost-share corrections.
Lemonade Insurance Company also received a $100,000 fine for self-reporting the use of an incorrect rate on property policies. The issue, which affected policies issued between January and April 2022, resulted in 43,094 policyholders receiving refunds totaling $415,589, including interest payments.
Additionally, Delta Dental and its benefits manager, Wyssta, were fined a combined $130,000 for violations related to claims processing. A review by the OIC uncovered that Delta Dental had used unapproved terms for claims and failed to properly disclose its healthcare benefits manager (HCBM) as required by law. The OIC found improper claim denials based on unpublished time and frequency limits for services and delayed website notices regarding the company’s HCBM.
Other notable fines were issued to companies such as Kaiser Foundation Health Plan, Asuris Northwest Health, and Capital Claims Management for various regulatory violations, including wrongful claim denials, unlicensed business practices, and the failure to meet filing requirements.
The fines assessed by Kreidler’s office contribute to the state’s general fund, supporting services for residents.
Since 2001, Kreidler has assessed more than $42 million in fines.