Consumer Protection in Private Health Insurance: The Role of Consumer Complaints. G. Agency Performance Issues



The MIA has investigators who are specialized within two insurance lines, life and health or property and casualty. Life and health includes long term care, medical and surgical, life insurance and disability. The Life & Health Complaints Unit includes 1 Chief Investigator, one Quality Assurance Coordinator, nine investigators, one part-time investigator and three clerical staff to investigate and process non-medical necessity life, health and HMO complaints. Following the passage of the Appeals and Grievance legislation, the MIA established a new Appeals & Grievances Complaints Unit in the Consumer Complaint and Investigation Section with staffing as follows: 1 Chief Investigator, 5 Investigators, 2 clerical staff and 1 contractual physician.

The HEAU currently has 5 staff, 4 of whom personally handle grievances full-time. There are also 15-20 volunteers who handle most of the other complaints (i.e. non-grievances, complaints on billing issues etc).

Financial Savings to Consumers

The MIA collects some data on financial savings but noted that this is difficult to collect uniformly.

The HEAU captures some data on financial savings to consumers as a result of successful complaints resolution. In 1998 there were about $0.5 million of savings, while in 1999 the full- year savings are estimated to be between $1-1.5 million. However it is not always possible to fully capture this information or do so in a way that is comparable. The new database will allow the capture of two new fields - firstly, the $ that consumers want to get through complaints resolution, and secondly, the $ received as a result of action by the HEAU. It should be noted, however, that consumers are often very uncertain about what they want to achieve in resolving their complaint.

Consumer Satisfaction Surveys

The MIA does not undertake consumer satisfaction surveys for insurance complaints generally. Regulators commented that, given current staffing levels, they would prefer to have staff dealing directly with patient complaints rather than undertaking surveys.

However, following the passage of the Appeals & Grievance legislation, the MIA undertook a small mail survey in December 1999 of 342 individuals who had filed complaints with the Appeals & Grievances Complaints Unit. With a response rate of only 25%, the survey found that the majority of consumers were satisfied with their contacts with both the MIA and the HEAU. Appendix H of the MIA's Report (Attachment 2) includes the survey questions and analysis.

The HEAU undertook a consumer satisfaction survey in the past, using a brief 4-question survey which was hand tabulated. Staff noted that this was a fairly basic exercise and there was limited confidence in the validity of this exercise. Under the appeals legislation, the HEAU intends to survey providers and patients in 2000 regarding the operation of the new grievance process.


The MIA undertakes internal audit processes every 6 months and uses supervisory review in managing complaints. Regulators noted that this process will need to be reviewed and updated given the grievance and appeals legislation.

There has been no audit of the HEAU's operations. HEAU staff noted that the major concern of the General Assembly was timeliness by insurance plans in managing grievances, resulting in the requirement on insurance plans to respond to the MIA or HEAU in seven days on appeals.

Timeliness of Complaints Resolution

While the HEAU does track time taken to resolve complaints, this data is currently not particularly reliable. It is a low priority of staff to record when complaints are closed, so that this information will often overstate the time taken for closure. However the HEAU does run reports from its database, checking the length of time taken.

A further issue in monitoring time for resolution of complaints is that the largest delay under the new grievance process is getting authorization from the patient and/or getting necessary information from the clinical provider. The legislation requires insurance plans to respond within seven days, but imposes no timelines on other parties to the complaint. One of the major health providers in Maryland is attempting to get patient consent to the grievance process included on their admission/treatment forms which would expedite the process if it needs to be invoked.