Autopay gone bad - Florida Blue

[MichaelB]

Florida Blue (BCBS) autopay went haywire this month. For some members, it apparently withdrew the scheduled monthly payment more than once - until there were no funds left - entirely draining many bank accounts. From the Sun-Sentinel

Instead of a single deduction for their May health insurance premium, customers logged into their checking accounts and discovered multiple withdrawals.
The company, which was plagued by a series of glitches earlier this year, said it has shut down its electronic payment system and plans to refund money to customers for any improper withdrawals or late fees.
Florida Blue auto-pay glitch wipes out some customers' bank balances - Sun Sentinel

The report documents multiple examples of tens of thousands of $$ withdrawn erroneously and included confirmations by Chase and BoA. Scary how easily this happened.

We have two accounts on autopay, had multiple payments withdrawn for March and April, and when I called to complain, they insisted it was user error setting up the autopay. Right.

The back office systems for insurers are stone age. Hopefully they will see the light and update them.

 

[euro]

That's why I use the feature sparingly - I inherently mistrust it. That said, I must admit that on the whole, it is probably still much more reliable than the conventional paper billing. However, it is not perfect as your example shows - nothing is.

 

[littleb]

I set up auto pay years ago to withdraw my automobile insurance payment. This was long before auto pay became a normal option. One month they took out 2 payments and caused me to bounce a check.

Never again.

I pay all my bills through my online banking where I designate when the payments will be deducted from my checking account.

 

[MichaelB]

It's not a surprise that BCBS Fl has an autopay issue. The system is ancient and not well designed.

What is unexpected is Chase and BoA have no alert or escalation process in place to prevent this from happening. Repeated transactions for the same amount draining an account are sure signs something is wrong. Consumer protection laws do not cover business accounts, so many of these account owners could be SOOL if not detected and reported immediately.

Extended family members had issues regarding fraudulent transactions with these two banks a decade ago. One was similar to this. It does not appear that banks are doing enough for security and still may be more concerned about reducing costs.

 

[broadway]

20 years ago, a co-worker told me that the local telephone company Ameritech took out more than it should have with AutoPay. That was a warning to me to not do AutoPay.

 

[ExFlyBoy5]

Interesting...you would think that would be a pretty easy code to write that would recognize the multiple drafts, especially of the same amount. I guess until the government TELLS them they have to put these protections in place, it will be a risk.

As a precaution against this very thing, I use an account that is for the auto drafts only, so I don't keep much money in there (there is an automatic transfer of a set amount each month that goes into it from my primary account) and I think the most that has ever been in there is about $300.

I have two payments that auto draft from a checking account, one for the water and one for the electric (they won't do autopay from a CC). Since I do this, I don't ever get mail/bills from either entity. Just yesterday, my USPS informed delivery showed a "bill looking" letter from the water company and I thought, "Well, I wonder if there is a billing issue?" but it was just a notice about the meter being replaced.

 

[exnavynuke]

Only my mortgage is paid from my checking account. All my other bills are paid by credit card automatically. I'd do the same for my mortgage if they'd let me.

 

[broadway]

As a precaution against this very thing, I use an account that is for the auto drafts only, so I don't keep much money in there (there is an automatic transfer of a set amount each month that goes into it from my primary account) and I think the most that has ever been in there is about $300.

Does this account have a minimum balance requirement?
If so, then it is still a hassle if they drained everything to $0.

 

[broadway]

Florida Blue (BCBS) autopay went haywire this month. For some members, it apparently withdrew the scheduled monthly payment more than once - until there were no funds left - entirely draining many bank accounts.

I suppose those customers should count themselves "lucky" that he software stopped at zero balance. Theoretically buggy software could mean an endless loop of withdrawals.

 

[Chuckanut]

I pay all my bills through my online banking where I designate when the payments will be deducted from my checking account.

Bingo!

Exactly what I do. I don't give anybody permission to go into my checking account and withdraw money. I ether use the bank BillPay feature where I tell the bank to send $NNN to a certain business, or I have them charge my credit card (even better since I have CC rights and get points).

I like Bill Pay a lot. I have gone as far as to have them automatically send the minimum payment each month for the two credit cards I use the most. Normally, I always pay off the entire balance, but in the case I forget for some reason, at least I don't have that awful late payment fee. Interest yes, but the late payment fee is bigger and easy to avoid this way.

 

[ExFlyBoy5]

Does this account have a minimum balance requirement?
If so, then it is still a hassle if they drained everything to $0.

Nope, it's a credit union account and since I have a CC with them, it comes with a free checking account.

 

[Just_Steve]

Thats why I only do push pay and never allow pull pay.

 

[FlaGator]

I'm in the minority of posters (so far) - I have everything on autopay that I can. Mostly CC, 4-5 are direct from checking.

Worked at a bank and been around large scale data management systems for 30+ years, so I understand what can go wrong. My belief is the hassle of dealing with a periodic event, while aggravating, takes less time than it does to manually pay those bills very month.

Regarding Florida Blue, I noticed that the May payment was drafted on the 2nd, not the 1st as usual. Agree their systems are archaic.

 

[Sunset]

Does this account have a minimum balance requirement?
If so, then it is still a hassle if they drained everything to $0.

True, but he won't be penniless for days while waiting for it to be corrected.

 

[W2R]

I'm in the minority of posters (so far) - I have everything on autopay that I can. [...]My belief is the hassle of dealing with a periodic event, while aggravating, takes less time than it does to manually pay those bills very month.[...]

I have paid everything possible with autopay since May of 2000. I check the payments each month, and have never had the slightest problem with it. Not only has it saved me considerable time and aggravation, I think it helped my credit score because I haven't been late with any payments for 17 years. And no late fees, ever. I am extremely satisfied with this service.

What finally got me to use autopay was that back in early 2000, I was traveling for work and was late paying a small bill at home because I accidently threw it aside (I think it was less than $5), and all h*ll broke loose. So, I figured I'd rather just have these things taken care of automatically with autopay.

 

[MichaelB]

I use autopay as much as possible, although my first choice is always credit card. Some businesses, especially utilities, allow only direct deduct.

This situation is unusual, but still a reminder that things can go wrong, ans when they do, they get messy very quickly.

 

[Car-Guy]

I pay most everything I can on-line but Netflix is the only autopay I have setup and that's VIA a credit card. I'm not going to give anyone autopay access to one of my checking accounts.

 

[FIREd]

I try to avoid autopay from my checking account as much as possible. I only use autopay when I can charge it to a credit card (Netflix, AT&T, BCBS, etc...)

 

[Cobra9777]

Most of our auto-pays are on cash-back credit cards. If they don't allow CC, then we do manual bill pay. The only case like this currently is one of our local utility companies. We also do manual bill-pay for the CCs themselves, although I've thought about changing that to auto-pay recently after being late once while we were on a long cruise.

One exception is our health insurance premiums. DW and I both have heavily-subsidized retiree HI via our former employers. One required auto-pay, but no CC option. The other... I got tired of doing bill-pay every month for the exact same amount. In both cases, the entity pulling the money is our former employer, not an insurance company. Never any problem, but if there was, I agree with FlaGator's take:

...My belief is the hassle of dealing with a periodic event, while aggravating, takes less time than it does to manually pay those bills very month...

 

[Bestwifeever]

This happened with our mortgage, the only thing we had on autopay. We had about three months' of payments in our checking account and that was pulled out by the mortgage bank. Checks bounced right and left as a result, and I immediately assumed I had done something wrong in balancing the checkbook. The mortgage bank took care of everything including writing letters of apology to the bouncees, but we refinanced as soon as we could through our credit union. The mortgage bank went under not soon after. That was back in 1982--before the everyday use of the term "user error."

 

[45th Birthday]

Florida Blue is THE WORST all the way around. Enrollment, billing, policy documents, etc. I had a huge number of problems with them this year. Just yesterday I received my fourth or fifth set of member cards (requested in December). Two of the sets were for last year's plan.


I didn't have anything taken out even though I'm on auto pay. Good thing, because that account is tied to my brokerage line of credit and they would have been able to take millions if they were truly doing it until the account was drained.


That said, I use auto-pay as much as possible, and this won't cause me to change that.

 

[braumeister]

The old eyeballs are playing tricks on me again.
When I saw this thread I thought it said Autopsy gone bad.

I was a bit reluctant to open it, thinking "Well, this is going to be grisly."

 

[Blue Collar Guy]

NYC took double taxes

i have auto pay on my house taxes, i pay once a year, 2 years ago everyone on auto pay paid double, they took out an extra 6000 bucks, they returned it a few days later, i did not bounce anything, but thousands of people did. i didnt even know it happened till after my neighbor told me it happened,https://therealdeal.com/2014/07/02/city-vendor-withdrew-property-tax-payments-by-mistake/

 

[athena53]

I pay most everything I can on-line but Netflix is the only autopay I have setup and that's VIA a credit card. I'm not going to give anyone autopay access to one of my checking accounts.

There were two cases where I had no other options. One is my Planet Fitness membership and the other was the year I had BCBS although maybe BCBS would have been OK with paper bills. So far, so good.

 

[Texas Proud]

Florida Blue (BCBS) autopay went haywire this month. For some members, it apparently withdrew the scheduled monthly payment more than once - until there were no funds left - entirely draining many bank accounts. From the Sun-Sentinel
The report documents multiple examples of tens of thousands of $$ withdrawn erroneously and included confirmations by Chase and BoA. Scary how easily this happened.

We have two accounts on autopay, had multiple payments withdrawn for March and April, and when I called to complain, they insisted it was user error setting up the autopay. Right.

The back office systems for insurers are stone age. Hopefully they will see the light and update them.

As I have said many times, I do not allow anybody to pull money from my checking account... I only push...

If I go autopay I use a CC.... if they started to charge like posted the CC company would have closed it down and alerted me right away...