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The Perils of Health Insurance Auto-Pay

Recently, I help a friend change her individual insurance policy to a company policy with Florida Blue. Her individual plan’s monthly premiums were auto drafted from her bank account about 10 days before the 1st of each month.

While canceling the policy she asked Florida Blue to stop the payment auto draft and actually to remove her bank information from the account. Florida Blue continued to automatically draft payments from her account. Not only is the money out of her account, but upon contacting Florida Blue again, she was told it may take them 6 to 8 weeks to refund her money by check.

My initial reaction was that this cannot be legal. I also wondered how widespread a problem this is for other Floridians.

First, I contacted my bank and asked them for advice. I was informed that insurance companies are notorious for disregarding notices to stop auto-drafting. The bank actually advised to close the bank account and open a new one, “so the insurance company would not have your banking information.”

Paying your premium on time is extremely important to maintaining health coverage. Auto draft or auto-pay is a convenient solution and has other advantages. It allows consumers to avoid late fees and lapses in coverage. However, there are real concerns, including stopping the auto-draft or auto-pay.

The best way to pay the recurring premiums is to either mail a check on time, 10 days before the due date, or set the insurance company up as a payee in your online banking portal. You then set the monthly premium up as a recurring payment from your bank to the insurance company, keeping you in charge of your money and your bank account.

Do you have a similar experience or another health care experience that you would like to share? Your story can make the difference in the lives of other Floridians dealing with the same.

Louisa McQueeney is a former ACA Navigator, the health plan coordinator for a small business, and currently works as the Program Director at Florida Voices for Health.


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