Uproar spurs firm to restore pricey insurance

Guardian Life Insurance Co. said Thursday that it would restore coverage for severely disabled Ian Pearl, 37, one of 500 employees and dependents in New York state whose policies were canceled in a cost-cutting move.

Mr. Pearl’s plight was the subject of a front-page article in The Washington Times on Oct. 14 and was subsequently highlighted on MSNBC and CNN. Guardian’s decision was announced as Mr. Pearl’s mother, Susan, was in Washington to lobby for health care reform and meet with members of Congress about her son’s case.

A victim of muscular dystrophy who has been wheelchair-bound since he was 6, Mr. Pearl suffered respiratory arrest at 19 and has been hooked to a tracheal tube and breathing apparatus ever since.

He requires 24-hour nursing care and Mrs. Pearl and her husband, Warren, say he must have in-home care. Being in a hospital ward on Medicaid would be a “death sentence” for their son, they say.

Ian Pearl’s medical bills are $1 million per year. His coverage was to expire in December, a year after Guardian’s initial decision to discontinue the line of coverage he had.

Mrs. Pearl said late Thursday she was elated by Guardian’s decision, but she expressed concern for the hundreds of policyholders who lost their coverage, including at least one other severely ill beneficiary in New York.

“I’m very encouraged to see Guardian taking responsibility for its conduct and to hear their intention of rescinding this plan withdrawal at least in Ian’s case,” she said.

“We would have to make sure that whatever deal is worked out with Guardian, absolutely [restoring the other policyholders] would have to be one of the conditions.”

Guardian’s e-mailed statement focused on Ian Pearl. It did not refer to the canceled policy types or to the other policyholders. Rather than canceling the coverage of specific people, Guardian discontinued a type of small-business plan dating to the 1980s that provided much more generous benefits, such as 24-hour in-home nursing, than nearly any other insurance plan available today.

Neither Medicare nor Medicaid provide such coverage.

Guardian spokesman Richard Jones said the company is not bringing back the policy line it discontinued in several states, but is committed to continuing coverage for Ian Pearl as well as that of one other customer in New York whom he did not identify.

The Pearls live in Fort Lauderdale, Fla., but are covered by the New York plan because Mr. Pearl’s business, Warren Pearl Construction, is in Manhattan, N.Y. The Pearls moved to Florida because the humidity benefits their son. Mr. Pearl, a wealthy businessman who could afford to pay for his son’s care for several years before going broke, commutes back and forth every week.

The company’s statement said that Chief Executive Officer Dennis Manning will meet with the Pearls to apologize “for the time it took to reach this resolution and for the language used in internal documents cited in this matter.”

In documents uncovered as part of the Pearls’ unsuccessful lawsuit against the company, Guardian executives referred to high-cost beneficiaries such as Mr. Pearl as “dogs” that the company should “get rid of” in order to lower its costs and market cheaper plans to businesses.

“Insurance companies are comprised of human beings and sometimes we make mistakes,” Mr. Manning said. “This was one of them, but we also learn from those mistakes and we seek to correct them. This is the right action to take because it is consistent with our values as individuals and as a company.

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