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Press Release May 8, 1998 |
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SAN FRANCISCO, CA – After a five-month investigation, the Kentucky Department of Insurance concluded that Anthem Insurance Companies, Inc. (Anthem) conducted a "highly misleading" public relations campaign in violation of Kentucky law. Yet the Department decided to take no action against Anthem, and will not call for a retraction so that policyholders and the public have correct information. Consumers Union and Kentuckians for Health Care Reform sent a letter to the DOI critical of this decision.
During a public debate about its charitable obligations, Anthem launched a public relations campaign last October against the Attorney General and national and local consumer groups in an effort to influence public opinion. Consumer groups immediately called upon the DOI to take action against Anthem, calling for a retraction of the inaccurate and misleading information Anthem provided to its policyholders and the public. The DOI called on Anthem to support its claims, and found Anthem’s first response insufficient. In a letter to Anthem in November, the DOI declared the campaign to be "misleading." The DOI, however, then allowed Anthem an additional ten-day opportunity to provide further documentation to support its claims.
In early March 1998, the Department sent a final letter to Anthem, concluding that the public relations campaign was "highly misleading." The Department did not make this letter available at the time to the public, policyholders or the consumer groups which Anthem attacked in a misleading way. After pressing the DOI for further information, Consumers Union received a letter this week in which Commissioner George Nichols stated "the investigation has been completed and the matter has been resolved in the best interest of Kentucky policyholders." The Department decided to take no action against Anthem for violating Kentucky law, because, it said, the company had voluntarily terminated its advertising campaign. The Department also chose not to require Anthem to correct the misleading information that was sent to policyholders and included in ads, arguing that a retraction would only cause more "confusion."
"The losers are the public and policyholders in Kentucky. They were fed highly misleading information by their own insurance company, who has been let off the hook," said Julie Silas, staff attorney with Consumers Union. "The DOI announced with great fanfare that it would protect the Kentucky public and policyholders. In the end, that commitment was hollow. This decision sets a horrible precedent: any company in Kentucky could launch a brief, highly misleading public relations campaign, and get away with it."
