Your Liberty National Cancer Policy May Provide Full Payment for Chemo Expenses

Liberty National Tried to Pull the Bate and Switch on Its Cancer Policyholders

In the late 1970s and early 1980’s, Liberty National Insurance Company issued cancer

policies that did not place a cap on the amount of chemotherapy or radiation payments

made. When Liberty National realized that they were paying more in claims than they

wanted to, they ceased selling these policies and in many cases tried to substitute

policies that provided for caps on these expenses. However, many of these old policies

remain in effect. In Liberty National Life Insurance Company v. McCaskill, The Alabama

Supreme Court described the scheme:

The 1982 policy provided coverage for various costs associated with

cancer treatment; these included limited hospital expenses, surgical

expenses, and private nursing costs. Of particular importance to this case,

however, was the 1982 policy's coverage for expenses stemming from

radiation, chemotherapy drugs, and prescription drugs. In the 1982 policy,

Liberty National set no maximum limit for coverage of these expenses;

therefore, Liberty National agreed to provide total coverage of these

expenses.

Evidence at trial indicated that 65% to 80% of cancer patients are treated

with radiation, chemotherapy, or a combination of the two. Prescription

pain medication, described in trial testimony as the “dominant expense in

taking care of long-term cancer patients,” is used by 50% of those patients

who continue treatment beyond their initial cancer treatment. The price of

treatment by radiation, chemotherapy, and related prescription medication

is very high. The prescription pain medication can cost up to $2 per dose;

with several doses of different types of medication a day, the costs for a

patient may easily reach over $1,000 a month. The cost of chemotherapy

may range from nearly $700 to over $1,600 per day of treatment.

Radiation and medicine relating to its use may cost over $3,600 a day

during certain periods of the radiation treatment cycle. Expensive

prescription anti-nausea and antibiotic medications are also used in these

cancer treatments.

In the 1980s, Liberty National developed a steadily increasing amount of

expenses stemming from claims under these full-coverage policies. At the

same time, Torchmark Corporation, Liberty National's parent corporation,

ordered Liberty National to cut its expenses. Liberty National then embarked on a program to persuade its cancer insurance policyholders to exchange the older policies for new cancer policies. These new policies increased coverage or created additional coverage in certain aspects; for example, the new policies provided a $2,000 cash payment for the first occurrence of cancer and provided coverage for certain “dread diseases,” such as polio and tetanus, that was unavailable under the old policy.

However, the new policies limited their coverage to $500 per day for

radiation and chemotherapy treatments and $8,000 a year for prescription

chemotherapy drugs; no coverage was provided for prescription anti-

nausea, antibiotic, or pain medicine.

You May Be Entitled to Payment Under Your Cancer Policy

If you purchased one of these old policies and you have recently begun treatment for

cancer you want to make sure to make a claim right away. Depending on the policy

language, these benefits may apply even another insurer or Medicare has paid for these

benefits. Liberty National is now owned by Globe Life and you can find instructions for

filing a claim at this link from Globe Life’s website.

If you run into any problems with payment on your cancer policy, please don't hesitate to

give us a call. We proudly represent Liberty National policyholders.