THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, March 3, 1996 TAG: 9603050365
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY TOM SHEAN, STAFF WRITER
LENGTH: Long : 149 lines
When Gerald B. Haeckel found an discrepancy in his bill for an insurance payment, he wrote to Trigon Blue Cross Blue Shield for an explanation.
Haeckel wasn't satisfied with the response, so he wrote a second letter to the state's largest health-care insurer. Then a third. And a fourth.
``My letters to Trigon were entirely ineffective,'' says Haeckel, a retired corporate executive who lives in Scottsville, near Charlottesville.
He followed up with letters to state insurance regulators and a U.S. senator. That persistence led to investigations in 1993 and 1994 by state regulators and more than $70 million of customer refunds.
Consumer complaints rarely produce such spectacular results. But too few people make their dissatisfaction known when they have problems with a business, say consumer advocates and others who handle consumer problems with businesses.
Some figure a company won't listen to their complaint. So they decide it's not worth the effort. Others don't know where to start.
``We find that many businesses do respond,'' says Jerry Grohowski, president and chief executive of the Better Business Bureau of Greater Hampton Roads.
That's partly because complaints can provide feedback about the quality of their service, he says.
Before firing off a letter, a dissatisfied consumer should try to resolve a problem with someone at the business.
``Be courteous and give the company the benefit of the doubt,'' says Jean Ann Fox, president of the Virginia Citizens Consumer Council. ``Maybe someone made a mistake.''
Fox, Grohowski and others who handle consumer issues offer some tips for getting results:
Explain your problem as concisely as possible.
Provide evidence of your transaction, such as a receipt or canceled check. If you have a contract, bring that along or include a copy in a letter.
Explain what you would like the business to do.
Avoid making threats or using abusive language.
Include your name, address, telephone number and how you can be reached during working hours.
If the problem can't be remedied in a face-to-face discussion, a letter may be the best way to get attention.
``It sends a complete and consistent message that can be passed along, intact, to the appropriate person for a response,'' the Virginia Office of Consumer Affairs says. ``A phone call, on the other hand, may be misdirected, reinterpreted or even lost before action can be taken.''
Even if you plan to call or visit a business about your problem, it helps to write down the details of your complaint ahead of time, Grohowski says.
In some situations, including landlord-tenant disputes, complaints have to be put in writing, says Cathy Parks, director of the Consumer Affairs division for the city of Virginia Beach.
``Be reasonable,'' Parks says. ``An angry or threatening letter may create more problems. You don't want your letter to alienate the reader right off the bat.''
It's also important to give a business sufficient time to respond. If the business doesn't act, you may have to follow up with additional calls and letters.
Is it worth sending copies of a complaint to consumer agencies?
Not initially, says Robert Gill, director of the city of Norfolk's Officeof Consumer Affairs.
Some disgruntled consumers immediately send copies of a complaint to several consumer organizations and government agencies. ``They hope this will cause an uproar, but it may make the business less willing to cooperate, Gill says.
However, receiving copies of complaints may signal to a consumer-affairs office that several individuals are having difficulty with the same product or service, says Fox of the Virginia Consumers Citizens Council.
``If there are no complaints on file at a particular agency, it's hard to prove that something needs to be done about a problem,'' she says.
For people who cannot reach a business or cannot get a response, several organizations and agencies offer assistance. Those with staff investigators include state consumer-affairs in Richmond and city offices in Norfolk and Virginia Beach.
Another source of help is the Better Business Bureau of Greater Hampton Roads in Norfolk, which serves as as a go-between for consumers seeking a remedy and local businesses. The BBB also offers dispute-resolution services for more difficult conflicts.
Tackling a problem with a regulated company like a bank, insurance company, securities brokerage firm or public utility can be more complicated. State and local consumer-affairs offices must defer to state and federal regulatory agencies.
The State Corporation Commission in Richmond, which has broad regulatory powers over business activity in Virginia, provides a toll-free hotline for consumers seeking help.
But a complaint with the SCC must be in writing, says Ken Schrad, a commission spokesman. And it's important that a consumer include copies of receipts, contracts or other records with the complaint, Schrad says.
Gerald Haeckel's letter-writing campaign suggests that persistence may be just as important as providing adequate documentation.
When he failed to get an adequate explanation from Trigon, Haeckel wrote to to the SCC's Bureau of Insurance. Trigon, he noted, sought a 20 percent co-payment of $190 for a surgical procedure that had cost $950.
According to Haeckel's bill, Trigon had paid $760 of the $950 cost, or 80 percent. However, a voucher from the University of Virginia facility, where the surgery had been performed, said the procedure had cost $564. Trigon, according to the voucher, paid only $451.20.
So Haeckel figured his 20 percent co-payment should have been $112.80, not the $190 that Trigon sought.
The discrepancy suggested that Trigon received a discount from health-care providers but wasn't passing along the savings to customers. If that were the case, the cost to Trigon customers of higher co-payments was significant, Haeckel said in his letter to the SCC's Bureau of Insurance.
The bureau, however, told Haeckel that it lacked jurisdiction in the matter and could not intervene.
Haeckel wasn't deterred. He heard that Sen. Sam Nunn was looking at Blue Cross Blue Shield billing practices in other states and wrote to the Georgia Democrat about the Trigon matter.
Nunn, who was chairman of the Senate permanent subcommittee on investigations, responded that he didn't have the funds to look into Haeckel's dispute with Trigon. But the senator said he would contact the head of Virginia's Bureau of Insurance, Haeckel says.
An investigation by the bureau in 1993 and 1994 turned up a pattern of abuses by Trigon. The result: Trigon agreed in 1994 to refund $23 million to customers and to pay a $5 million fine. Late last year, the insurer agreed to refund another $50 million to customers.
When Haeckel challenged Trigon over the way it determined customer co-payments, he was better prepared than most consumers. He had spent a career in corporate finance, first with a large life insurance company and then in executive posts at gas-pipeline and oil companies.
But Haeckel says he has rarely complained about consumer transactions. The only other time he voiced dissatisfaction about a product in writing was in the 1970s. Ice-cream manufacturer Swensen's Inc. had changed one of its flavors. The flavor - an orange-Swiss chocolate combination - happened to be Haeckel's favorite.
``I wrote them a tongue-in-cheek letter saying that if they were going to change it, they could at least send me the recipe,'' Haeckel jokes.
Swensen's responded by sending him $7.50 of coupons for more of its ice cream. ILLUSTRATION: Graphic
TIPS FOR COMPLAINING EFFECTIVELY:
Provide details about the transaction, including the date, place
and amount of money involved.
Provide evidence of the transaction, such as receipts and
canceled checks.
Explain what the business can do to remedy the problem.
Avoid using abusive language, making threats or getting angry.
Allow the business a reasonable amount of time to respond.
Be persistent if you do not get an adequate response.
by CNB