California’s managed-care regulator announced Wednesday it hasfined insurance giant Anthem Blue Cross $5 million for repeatedlyfailing to resolve consumer grievances in a timely manner.

The state Department of Managed Health Carecriticized Anthem, the nation’s second-largest health insurer, forsystemic violations and a long history of flouting the law inregard to consumer complaints.

“Anthem Blue Cross’ failures to comply with the law surroundinggrievance and appeals rights are long-standing, ongoing andunacceptable,” said Shelley Rouillard, director of the Departmentof Managed Health Care. “Anthem knows this is a huge problem, butthey haven’t addressed it.”

Before this latest action, California had already fined Anthemmore than $6 million collectively for grievance-system violationssince 2002.

The state said it identified 245 grievance-system violationsduring this latest investigation of consumer complaints at Anthemfrom 2013 to 2016.

Rouillard cited one example in which Anthem denied a submittedclaim for an extensive surgical procedure, even though it hadissued prior approval for the operation. Twenty-two callscontesting the denial — placed by the patient, the patient’sspouse, the couple’s insurance broker and the medical provider —failed to resolve the complaint. It was not until the patientsought help from the managed-care agency, more than six monthsafter the treatment, that Anthem paid the claim.

In a statement, Anthem acknowledged there are some legitimatefindings in the audit, but it strongly disagreed with the state’sassertion that the problems are “systemic and ongoing.” The companysaid it will contest the fine.

“Anthem has taken responsibility for errors in the past and hasmade significant changes in our grievance and appeals process, aswell as investments in system improvements,” the company said. “Weremain committed to putting the needs of our members first.”

Anthem Inc., based in Indianapolis, sells Blue Cross policies inCalifornia and 13 other states.

California is known for having tough consumer protection laws onhealth coverage and for assisting policyholders when they exhausttheir appeals with insurers. In other actions, the state has finedinsurers for overstating the extent of their doctor networks andfor denying patients timely access to mental health treatment.

Jamie Court, president of Consumer Watchdog, an advocacy groupin Santa Monica, Calif., said the regulatory response to theseproblems varies greatly by state. He singled out New York,Washington and Kansas as some of the states with good track recordsof holding health insurers accountable.

“The real problem is when states don’t act there is not a greatavenue for the consumer. It’s very hard to bring legal action,”Court said. “Anthem definitely needed a wake-up call. But this willalso send a message to other insurers.”

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This story was produced by Kaiser Health News, whichpublishes California Healthline, a service ofthe California Health Care Foundation.

Nationally, consumers continue to express their displeasure withhealth insurers over a wide range of issues, including denials fortreatment, billing disputes and the lack of in-network doctors.

Verified complaints related to health insurance and accidentcoverage rose 12 percent in 2016 compared to the previous year,totaling 53,680, according to data compiled by the NationalAssociation of Insurance Commissioners. The data only includesincidents in which state regulators confirmed there was a violationor error by the insurer involved.

Court and other advocates welcomed the significant fine inCalifornia and said this is just the latest example of Anthem’sfailure to uphold basic consumer protections.

Overall, state officials said that calls to Anthem’s customerservice department often led to repeated transfers and that thecompany failed to follow up with enrollees.

“If you look at the history of Anthem and the penalties assessedover the years, they are definitely an outlier compared to otherhealth plans,” Rouillard said.

“All the plans have some issues with grievances, but nothing tothe degree we are seeing with Anthem.”

The managed-care department said a health plan’s grievanceprogram is critical, so that consumers know they have the right topursue an independentmedical review or file a complaint with regulators if theyare dissatisfied with the insurer’s decision. The grievance systemcan also help insurers identify systemic problems and improvecustomer service, state officials said.

The state’s independent medical review program allows consumersto have their case heard by doctors who are not tied to theirhealth plan. The cases often arise when an insurer denies apatient’s request for treatment or a prescription drug.

In 2016, insurance company denials were overturned in nearly 70percent of medical review cases and patients received the requestedtreatment, according to state officials.

This story was produced by Kaiser Health News, whichpublishes California Healthline, a service ofthe California Health Care Foundation.