Oregon Public Broadcasting

The state has fined a health insurance company $46,000 for improperly denying claims.

The problem surfaced after a woman complained PacifiCare Life Assurance refused to cover her medical costs.

An investigation discovered the company had denied nearly 5000 legitimate claims over three years.

Cheryl Martinis of the Oregon Insurance Division, says the law requires companies to conduct a reasonable investigation before refusing to pay.

Cheryl Martinis: “They sent a denial letter and then they would ask people to send more information, instead of just sending a letter that asked for the information. So I’m sure it was confusing for a lot of insured members.”

PacifiCare Life Assurance reviewed more than 10,000 claims and determined it should have paid half of them. It notified the state of the problem.

The company insured nearly 13,000 Oregonians in 2007, earning $42 million.