Blue Cross customers fume as insurer scrambles to fix ACA enrollment errors

Anxious customers of Blue Cross and Blue Shield should know by next week whether they will have health care coverage for the month of January, as North Carolina’s largest health insurer scrambles to fix technical problems that have affected thousands of people in the state.

The Chapel Hill-based insurer is dealing with the fallout from a troubled health insurance enrollment for state residents on individual policies, most of them through the Affordable Care Act. Customers have been unable to verify coverage or unable to submit payment for coverage. Some say they have been assigned to the wrong policies or even signed up for multiple policies.

Many of the company’s individual policy members did not receive their insurance ID cards on time, and some are still waiting for their cards to arrive in the mail. A number of complaints involve ID cards with numbers that are not valid, rendering the cards useless.

Blue Cross had expected enrollment problems, according to internal corporate communications obtained by The (Raleigh) News & Observer, and the company had prepared to conduct a mop-up operation in the first week of January to retroactively activate customers who had been accidentally dropped from the system.

But the scale of the malfunctions exceeded anything Blue Cross officials had expected, and customers worry the insurance giant’s miscues could leave them uninsured for weeks until the situation is resolved.

The difficulties have become so widespread that the N.C. Department of Justice sent Blue Cross a letter this week asking it to explain what went wrong, how many customers were affected and how it plans to rectify the billing errors that were made in recent weeks.

Blue Cross says the number of customers affected was about 25,000, but internal documents show that considerably more people were likely caught up in the disruptions. For example, the internal documents show that most customer ID cards were mailed in early January, later than when customers were supposed to receive them.

Blue Cross is doing everything it can to address the issues that remain for the affected customers, Blue Cross CEO Brad Wilson said in an email Friday night.

“Ninety-four percent of our individual customers were enrolled timely and accurately,” he wrote. “We have admitted there (are) issues, most of which are caused by the complexities and inaccuracies provided to us by the Federal Exchange, over which we have no control. Notwithstanding, we stand accountable for trying to fix these issues on behalf of our customers and we will continue to do so.”

‘I’m tapped out’

Some customers are reporting bizarre glitches. The Blue Cross online customer portal this week showed that Beth Anne Corriveau of Raleigh had a valid insurance policy with a termination date of 12/13/2199 – nearly 185 years hence. It also shows her Visa credit card expiration date as 01/1753 – that would be more than 250 years ago. The site says Corriveau is delinquent on her account.

Jim and Kathy Kluth, both 60, of Charlotte, said they’ve received three different ID numbers for a new Blue Cross policy they purchased, starting Jan. 1, and they got duplicates of the third number in the mail last week.

But they were more frustrated by the insurer’s confusion over their premium payment. The Kluths said Blue Cross mistakenly debited $1,245 (the amount of last year’s premium for Jim’s single policy) from their bank account on Jan. 6 even though they had already paid their new premium of $1,991, for a 2016 policy that covers them both.

Kathy Kluth said this happened even after a Blue Cross representative assured her on the phone on Jan. 4 that no premium would be deducted from their bank account.

Blue Cross has since returned the money, but the Kluths said they’re angry they had to spend 12 hours on the phone with Blue Cross over three days, much of the time on hold.

“The bottom line is we’re paying a whole lot of money for health insurance, and we ain’t getting a whole lot of service,” Kathy Kluth said.

Jim Kluth, a self-employed Realtor, said they were fortunate to have had extra money in the bank. “Nothing bounced. Nobody turned off my lights. Nobody turned off my power. But it could have been.”

Of the estimated 25,000 customers who didn’t get the health insurance policy they had selected, about 17,000 remained to be processed Thursday, Blue Cross officials said Thursday. The company’s goal is to activate coverage retroactively to Jan. 1 for customers who made their first payment to Blue Cross.

But customers are concerned that amid the chaos, if their policies turn out not to be valid on Saturday, Jan. 16, they not only will go uninsured in January but they also would have missed Friday’s federal deadline to apply for health insurance for a Feb. 1 effective date. If that happens, these customers would likely have to go without health insurance for two months as a result of Blue Cross’ mistakes.

“For those of us in this position, we need to know (Friday),” said Kara Haywood, a Cary resident who enrolled in early December and has not been able to confirm ifwhether she and her family are covered. “I’d just like an answer from somebody.”

Haywood said she has canceled a routine checkup for her 8-year-old son and delayed taking her 4-year-old son to the doctor for ear pain. Her husband will likely have to cancel an upcoming appointment at a pain center for his chronic back problems. “Almost everyone in my family is affected by this,” she said.

As of Thursday, the N.C. Department of Insurance had received 168 complaints from Blue Cross customers. The department is forwarding names to Blue Cross of individual customers who should be prioritized for health coverage, flagging priority matters with “very sad case,” and “urgent!” and “we can feel the frustration mounting from consumers!”

Mitigating factors

The agency also expressed its own frustration with Blue Cross.

“I am concerned that we are still hearing that ID#s given out by BCBS are not valid,” Becky Thornton, manager of life and health services for the department’s Consumer Services Division, wrote in an email to Blue Cross on Wednesday. “Something is not working ...”

Blue Cross is voluntarily providing daily updates to the state insurance department, upon the agency’s request, said DOI spokeswoman Kerry Hall.

Wilson, the company CEO, has been personally apologizing to customers and taking blame for the problems. The company also cites mitigating factors, and says insurers in other states have been experiencing similar problems.

“The issues our customers are experiencing are not solely a result of system performance. The primary factor in customer issues has been call volume,” Blue Cross spokeswoman Ryan Vulcan said in an email. “We forecasted and expanded staff for a 40 percent increase over last year’s peak month, but experienced a 500 percent increase in call volume.

“In addition to volume, a confluence of factors including new products, new service areas, and late and extended payments contributed to this customer service challenge,” Vulcan said.

However, Blue Cross’ internal communications, including Blue Cross employee intranet communication called “The Zone,” show that, despite the mounting public outcry, company officials deem the overall outcome to be largely successful.

‘A few bumps’

Blue Cross blamed some of the complications on a technology transfer of 400,000 individual customer accounts migrated from a legacy software platform to Topaz, a technology system operated by the nation’s leading health care billing and administrative vendor, TriZetto. The specific Topaz system used by Blue Cross is called Facets.

“As we expected with a job this size, there have been a few bumps, which we are addressing quickly,” The Zone told Blue Cross employees on Jan. 6, at a time that tens of thousands of customers were clogging customer service lines and waiting for hours on hold. “Our proactive planning has helped limit the member and provider impacts.”

Blue Cross says the Jan. 6 issue of The Zone was written before call volumes exploded.

Within the health care sector, TriZetto has a reputation for inconsistent quality control, according to the Gartner research firm. Last September, a Garnter analyst worte that TriZetto “still has work to do to overcome negative perceptions of its service levels in its core lines of business.”

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The transition of individual customers to TriZetto technology is one of the biggest tasks Blue Cross has ever taken on, according to Stevie McNeal, Blue Cross’ Topaz program executive overseeing the data transmission.

“We knew there would be challenges,” McNeal was quoted in The Zone on Jan. 6. “Our proactive strategy has helped us work successfully with members and doctors so our customers could get the care they need while we address issues that have come up.”

Blue Cross’ proactive strategy included giving customers until Jan. 7 to pay for their insurance, notifying them by letter that their ID cards would be arriving late, and beefing up customer service staff to handle customer questions in January.

Those measures were put in place during the runup to the the Jan. 1 effective date for 2016 health insurance. As the deadline loomed, Blue Cross managers received weekly status updates on the Topaz technology upgrade, as chronicled in internal documents.

The Dec. 4 “NC Program Integrated Status Report,” covers the events of the previous week, going back to late November. “TriZetto is working to resolve defects for all issues,” the status report said, noting that about 17,000 customer transactions out of 53,000 contained defects – a 32 percent error rate.

When asked to comment on the internal status reports, Blue Cross warned about misinterpreting the internal communications.

“The documents shared are misleading and a snapshot of a larger picture,” said Vulcan, the Blue Cross spokesman, in an email. “They actually show the extensive vetting process BCBSNC takes to identify risks and mitigate customer impact through our business contingency planning.”

Observer staff writer Karen Garloch contributed

This story was originally published January 15, 2016 at 2:50 PM with the headline "Blue Cross customers fume as insurer scrambles to fix ACA enrollment errors."