THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Thursday, December 15, 1994 TAG: 9412150444
SECTION: BUSINESS PAGE: D4 EDITION: FINAL
SOURCE: ASSOCIATED PRESS
DATELINE: ROANOKE LENGTH: Medium: 54 lines
Trigon Blue Cross Blue Shield is trying to improve communications with its customers, in response to criticism for failing to pass on cost savings to consumers.
The Richmond-based health insurance company is creating a consumer affairs department and regional consumer councils. Trigon President Phyllis Cothran said the new system stems from the public-relations problem the company had with billing practices outlawed by the General Assembly. She described the problems as a ``wake-up call.''
Trigon is providing refunds to consumers for a portion of reduced co-payments it had received from hospitals since 1981. Instead of being refunded directly to affected consumers, the savings were used to reduce premiums in the competitive marketplace, Cothran said.
The State Corporation Commission ordered the refunds.
Cothran said Trigon will provide ``a two-way educational stream'' between the company and its 970,975 policyholders. The company will explain what it does and the councils will tell the company about customers' needs, Cothran said.
The head of the company's new department will become a consumer advocate, Cothran said, helping the company to change its business materials or practices that consumers find hard to understand.
Cothran said that some practices develop over time that do not harm consumers but are difficult to explain. She said no company should have a practice that cannot be explained in two sentences in a newspaper or brochure.
As of Monday, the company had mailed 413,583 letters to consumers who may be affected by the refund program. It also had placed 384 ads in 120 newspapers around the state. As a result, the company received 100,791 telephone calls about the campaign by Monday.
Trigon had received 124,786 claim forms. Of the claimants, 84,358 had been paid a total of $10,957,864. Cothran said that the average refund has been just under $200. Trigon Chairman Norwood Davis said he had a refund of $64.
Of the claims, 11,167 were rejected as ineligible and, of that number, 192 had filed appeals.
The deadline for filing claims was extended from last week to Jan. 7. The refund program covers hospitals and other treatment facilities, but it does not include bills from physicians and practitioners.
The practice stopped Jan. 1. the Virginia General Assembly outlawed it as of July 4. by CNB