When the Rock Is a Hard Place

It sometimes seems as if certain insurance companies have terrible troubles operating their customer services efficiently.

They lose correspondence, misdirect telephone calls, promise a quick payment without making it, claim someone long enrolled is not covered and often make policyholders jump through all kinds of hoops to collect.

Are such incidents the result of accidents or ineptitude or, more troubling, part of an intentional strategy by some insurers to discourage all but the most determined claimants from pursuing their cases?

Those questions arose after I wrote a column four weeks ago on a Las Vegas couple’s difficulties in getting Prudential HealthCare to pay the wife’s claims of more than $90,000 for lung cancer treatment.

John B. Wickman and his wife, Michael, had been insured through Prudential for 28 years, but when they made this first major claim, the company declined to pay on grounds the couple weren’t policyholders. And it stuck to that position for three months, until Unocal, the company Wickman had retired from, put pressure on Prudential to fess up and pay.

The day the column appeared, I received an e-mail message from a man identifying himself as a Prudential employee:

“I’ve been employed by Prudential as a customer service rep and claims examiner for the past year and it’s my observation that the type of scenario you describe tends to be the rule rather than the exception,” he said. “Your article reinforces the fact that I need to do what’s right as opposed to what I’ve been trained to do.”

He asked not to be identified. But I was able to definitely confirm that he was with Prudential.

Then, on Aug. 13, a former Prudential employee, the wife of a current employee, sent me an e-mail on troubles she had collecting from Prudential for treatment during and after her pregnancy.

She too said that for long periods she had been denied benefits and told she wasn’t covered, until after “many, many” phone calls, some by her husband to colleagues, the payments finally came.

“Then, after I had the baby, we received a bill from PruCare stating that they couldn’t pay the hospital because the patient was not covered,” she wrote. “And the reason: They had my husband’s ex-wife listed as the patient.”

Not everything has been paid yet, she said, adding, “I just wanted to let you know that the Prudential HealthCare problems are widespread.”

She too wanted anonymity.

With this second message involving Prudential employees, I decided to seek company response.

The most provocative remark, of course, had come from the service rep on the company’s training of its employees. In further contacts he said he and others had been inadequately trained to perform satisfactorily. He revealed he has secured a new job and will be leaving Prudential shortly.

In the meantime, I had passed on to Prudential what the two e-mails said and asked if it does train its employees to act in a manner to frustrate policyholders.

After providing a none-too-specific response, Kevin Heine, chief corporate spokesman, late Tuesday, upon my earnest solicitation, provided a more pointed and effective answer.

“Any suggestion that Prudential HealthCare has a policy in place to delay or deny claims is unfounded,” he said. “Our policies and training programs are focused on making sure claims get paid correctly and promptly. . . .

“Our training programs teach employees about our internal customer service and claims paying standards, as well as the legal and regulatory requirements we must abide by. We set individual performance goals. . . . When those goals are not met, we work with our employees through additional coaching and training activities.”

Heine did, on this second try, “acknowledge that some of our customers have experienced delays in getting their claims paid as we have transitioned the claims and customer service functions from other offices to the new National Service Center in Los Angeles.”

However, he said, “we have implemented several steps to improve our performance.”

In Los Angeles at the new service center, “we have already hired nearly 400 people since January of this year--a 23% increase in staff--to bolster our capabilities. . . .

“These efforts are paying off,” he said. “We currently process approximately 85% of all claims within 30 days. Our own standard is to process 85% within 15 days, and we expect to reach that goal in the next 60 days.”

Heine had said earlier that despite Prudential examining the option of selling its HealthCare division after several years of losses, it has “recently invested hundreds of millions of dollars in new customer service and claims centers, including the facility in Los Angeles.”

It is none too soon, either, because in the last two years, at least two major entities that used Prudential’s health insurance services, Unocal and the American Assn. of Retired Persons, have moved to other providers because they were dissatisfied with the company’s performance.

The employee who first e-mailed me about training procedures acknowledged that Prudential has indeed been investing in new facilities and new hiring.

But, he said, this has its drawbacks, because the company has been hiring “new customer service reps who have no experience with customers, service or insurance.”

“They’re hiring warm bodies and, interestingly, paying them more than experienced representatives,” he said. “As experienced reps are becoming aware of this situation, they get resentful and frustrated, and this is the voice and attitude that often greets a caller.”

This hints that labor relations are part of the problem at Prudential HealthCare.

Still, in their own convoluted way, disgruntled employees and the company itself both avow they are preoccupied with the importance of improving customer service.

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Ken Reich can be contacted with your accounts of true consumer adventure at (213) 237-7060, or by e-mail at [email protected]