Most insurers to limit policy cancellations by May

We probably won't be seeing many more stories of people losing their health insurance when diagnosed with cancer or for any other reason except fraud. That practice will end by May for many insurers who practice it. The new health care law mandates that rescission (cancellation of an insurance policy after diagnosis of an illness) of insurance will only be allowed if a person commits fraud, and it officially takes effect September 23.

Now major health insurers are quickly picking up that tune and saying they will only drop or rescind coverage where a patient commits fraud or intentional misrepresentation. "As soon as the law was enacted, we began looking at all the provisions so we could implement reforms with the minimum amount of obstruction and offer greater peace of mind to the 200 million people we serve," Robert Zirkelbach, director of strategic communications for the American Health Insurance Plans (AHIP), told me by telephone interview. AHIP represents 1,300 members that provide health insurance coverage.