California Fines Blue Shield for Illegally Charging Patients for Contraceptives

State health regulators have fined Blue Shield of California $250,000 for illegally charging hundreds of its members for contraceptive health care services.

The insurance company also paid $228,254 in reimbursements to the members who were incorrectly billed, the California Department of Managed Health Care announced on Thursday.

Under state law, health insurance companies must cover contraceptive drugs, devices and products such as birth control and intrauterine devices (IUDs) at no cost to the patient. The Department of Managed Health Care found that from 2016 through 2019, Blue Shield had charged more than 330 members for those services.

“We always encourage health plan members who are having issues with their health plan — including billing issues like this, any kind of denials of healthcare services — file a complaint with your plan,” said Kevin Durawa, a spokesperson for the Department of Managed Health Care.

Blue Shield of California, based in Oakland, has over 4.8 million members across the state. The department started its investigation after receiving a complaint from a member who was charged for an IUD removal.

In October 2017, the member requested the device to be removed after experiencing complications with it. Doctors were unable to remove it during a routine office visit and had to perform an outpatient surgery to pull out the device.

The patient was billed $3,439 after the procedure. After Blue Shield denied a grievance filed by the patient, they turned to state regulators.

“The member did the right thing — they filed a complaint with the Department of Managed Health Care help center, which led to a broader investigation by the DMHC, which uncovered a much bigger issue,” Durawa said.

A Blue Shield spokesperson said the company has been “cooperative throughout the process of this investigation” and has taken steps to correct the issue but did not respond to a KQED inquiry into why the members were charged for contraceptive health care services in the first place.