People left holding bag when policies revoked

0 Comments | USA TODAY, January, 2007 | by Julie Appleby

Denise Wheeler, an artist in Laguna Beach, Calif., thought she and her family had health insurance.

So did Tony Seals, a self-employed businessman in nearby Riverside. Across the country in Connecticut, Maria Locker and Linda Gaskill each bought short-term insurance policies to protect themselves against catastrophic costs.

But each was left with tens of thousands in unpaid medical bills when their insurers -- all major companies -- retroactively canceled their policies after they faced expensive health problems. "It's the most devastating thing that's ever happened to us," says Seals, 43.

Their stories illustrate a little-recognized fact about insurance purchased by individuals: Even after being approved, policyholders can see their coverage...