Consumer Protection in Private Health Insurance: The Role of Consumer Complaints. E. Agency Performance Measures



The Department of Insurance Consumer Services Hotline has about 60 staff, including supervisors and clerical staff, working across all lines of insurance. The staff are organized into 5 teams of 10 staff with a supervisor, with regular supervisor meetings to examine emerging health complaints or patterns of complaints. In addition, there is a triage team comprising 6 people including a supervisor that handles health issues.

Volume of Business

As indicated earlier, the Department of Insurance receives about only 200 calls per month about health insurance to its Consumer Hotline.

The Lewin Group evaluation reports on the volume of print material distributed by the Health Rights Hotline. Over the 18 month period from July 1997 to December 1998 the Hotline distributed over 65,000 individual print materials to consumers in the four-county Sacramento area, the majority of which occurred through community organizations, health fairs, Hotline presentations and providers. The Hotline mailed 6,669 items to 2,358 callers. Exhibit IV.12 in the Lewin Group report details the number of copies of individual publications distributed to Hotline callers.

The Lewin Group evaluation indicates that the Hotline received over 7,530 calls in the first 18 months, 4300 of which became cases. Of these 25% were general information inquiries and about 75% sought assistance with a specific problem.

External Audit

The Department of Insurance is subject to both internal audit and external audit by the State Auditor’s office. External audit of the Consumer Services Division has occurred infrequently – possibly twice in the last sixteen years. However the Department strongly emphasizes internal audit including supervisors undertaking quality control on the Hotline (once per week or as needed), and random review of closed complaints by supervisors and other lead staff.

The Department of Corporations is subject to audit by the State Auditor. The 1999 Consumers Union and Center for Health Care Rights study reports some of the findings of the State Auditors 1999 report. Concerns expressed by the Auditor included that the Department failed to notify consumers when their complaints took longer to resolve than the allowed 60 days. The Auditor also expressed concern that the Department was not able to make a determination in about one- quarter of complaint resolutions as to whether there had been a violation or not.

Consumer Satisfaction Surveys

The Department of Insurance sends consumer satisfaction survey postcards monthly to a 15- 20% sample of all closed complaints. The postcards are color coded for return to the specific bureau which handled the complaint (e.g. Hotline, Rating and Underwriting Services Bureau etc). but regulators noted that the response rate to postcard surveys was generally quite low. Departmental publications noted that in 1998, consumer satisfaction surveys indicated that 86% of all consumers who contacted the Department would recommend it to others and 79% believed that their problem was resolved satisfactorily. The Department is also now including postcards when it sends out consumer education brochures, in an effort to seek consumer feedback and improve the content of these materials.

As part of its evaluation of the Health Rights Hotline, the Lewin Group undertook a consumer satisfaction survey of 489 clients who had used the Hotline. Of this sample, 62% rated the Hotline very helpful, 23% somewhat helpful, 5% not very helpful and 8% not at all helpful. The Lewin Group also evaluated in detail the helpfulness of particular tools used by the Hotline such as referrals and print materials (see Exhibit V.3 in Lewin report).

The Lewin evaluation of the Health Rights Hotline surveyed Hotline clients as to their satisfaction with referral contacts suggested by Hotline staff including medical providers, health plans, the California Department of Corporations and employer benefits departments (see Exhibit V.2 in Lewin report). On average, Hotline clients rated all referral contacts as very helpful in 31% of cases and somewhat helpful in 21% of cases. The most positive rating of referral sources was for employer benefits departments which were rated very helpful in 53% of cases. The least positive rating was received for the Department of Corporations which was rated very helpful in 24% of cases and somewhat helpful in 10% of cases. While this is not equivalent to surveying consumers who contacted the Department of Corporations directly and the sample size was limited, the Department was a significant outlier in terms of consumer satisfaction in this survey.

Staff at the Center for Health Care Rights commented that while the telephone consumer survey is quite costly, it provides value for money in allowing the collection of more data. It allows the Center to assess consumer satisfaction with referral sources as described above, in addition to consumer satisfaction with the Hotline itself.