Better Business Bureau: Beware of phony health insurance plans
Health care and health insurance are costly and complicated, making them fodder for scammers. In a recent enforcement action, the FTC alleged a company and its affiliates took advantage of people searching for comprehensive health insurance coverage that qualified under the Affordable Care Act (ACA), also known as Obamacare.
Benefytt Technologies and affiliated telemarketers and lead generators marketed health insurance policies they claimed were ACA-qualified or offered the same coverage as ACA-qualified plans but at a lower price. They operated websites with names like “Obamacareplans.com.”
Qualified plans must offer specified benefits including preventive care, coverage for pre-existing conditions at no additional charge, and a cap on out-of-pocket costs. Unfortunately, may people who bought a Benefytt plan didn’t find out until too late that they really had little to no coverage at all. Some couldn’t schedule a doctor visit or fill a prescription, while others were left with hundreds or thousands of dollars of medical bills.
A nurse with a cardiac condition complained to the BBB that she was told her insurance plan would cover medical treatments, doctor visits, physical exams, and urgent and emergency care. But an appointment with her cardiologist was canceled when they determined she had no coverage. Other people complained that “I would have been better off with no insurance at all” and “I’ve paid over $4,000 for insurance that didn’t exist or cover anything at all.”
To make matters worse, the FTC says that Benefytt charged junk fees for additional services consumers didn’t know about or had been told were included in the cost of their policy. They included life or accident insurance plans, telemedicine access, and fitness programs. Some consumers who managed to cancel the health insurance policy itself continued to be billed for the additional products.
The FTC alleges Benefytt deluged people whose numbers were on the Do Not Call Registry with illegal robocalls. And finally, the company made it very difficult for people to cancel their policies, even going so far as to transfer them back to the agent who deceived them in the first place.
The proposed settlement requires Benefytt to pay $100 million for consumer redress, inform customers about the settlement and allow them to cancel their plan, refrain from making misrepresentations in the future, get customers’ express informed consent before billing them for anything, and closely monitor other companies selling its products. It bars the two principals from ever again participating in the advertising, marketing, promotion, or sale of any healthcare-related product.
The FTC and BBB offer this advice to consumers shopping for health insurance:
Compare plans, coverage, and prices at a trusted source. HealthCare.gov and state marketplaces are the first stop for information about ACA-compliant health insurance coverage.
Research any company offering health coverage or products. Search online using the name of the company plus “complaint,” “scam,” or “fraud.” Read reviews and check with your state insurance commissioner’s office to find out if there are any complaints. Check them out with the BBB.
Ask for information in writing. Is the plan really comprehensive health insurance?
The FTC asks that you pass this information on to anyone you know who bought health insurance from Benefytt Technologies.
Randy Hutchinson is president & CEO Better Business Bureau of the Mid-South. This column is in partnership with Better Business Bureau of Middle Tennessee & Southern Kentucky.
This article originally appeared on Jackson Sun: Better Business Bureau: Beware of phony health insurance plans
