This Open Enrollment Season, Look Out For Health Insurance That Seems Too Good To Be True

It was about a year ago that Kelly McCauley realized that the health package she bought when she bought insurance last October wasn't really insurance. Of course, there were red flags along the way, but when she called to complain, she said she had a reasonable explanation and made her pay the $700 monthly premium.

He said he was told medical bills would not be paid due to a typo at the hospital. Jericho Shares, a nonprofit organization that sent him a membership card that says "This is not insurance," is only the policy insurer, not the actual insurance company. He doesn't get a welcome package of policies because the company saves on paper and passes those savings on to the customer.

Then, this summer, the 62-year-old retired teacher, who had recently moved to South Carolina from the Philadelphia area, learned that her plan was to pay only $120 of last year's hip replacement bill and give him the rest. $40,000 He said he made sure the procedure was covered when he requested insurance. But it turns out that the plan he bought is not insurance at all, but part of the Ministry of Health.

Healthcare sharing services are an alternative to health insurance where members agree to share medical expenses. According to a report by the Commonwealth Trust, it is often religiously based and can be cheaper than traditional insurance, although it does not always cover its members' medical expenses.

"I was never told," McCauley said. "Actually, I think I have statutory health insurance."

Starting Nov. 1, millions of Americans will sign up for health insurance in 2023 during a period known as "open enrollment." Through state and federal insurance marketplaces, consumers can find affordable Affordable Care Act health insurance plans and see if they qualify for financial assistance.

However, experts warn that the rush to buy insurance also creates opportunities for people to sell alternative products. While the option itself is legal, experts warn that deceptive marketing can entice consumers seeking universal coverage to buy health plans that exclude coverage for pre-existing conditions and put patients at risk of higher medical bills.

"Now is the best time to find and mislead consumers looking for insurance," said Joann Volk, co-director of Georgetown University's Center for Health Insurance Reform.

Volk identifies the main symptoms of this misdirection: When the person who sold you the package starts asking about your medical history, refuses to send you information about the package, or agrees to provide that information, report it immediately after payment. And for this. According to a confidential 2021 buyer report on deceptive marketing practices he co-authored with Volk, a broker incorrectly cited HIPAA, the Patient Privacy Act, as a reason for not sharing health plan information.

"I made it," Falk said. "There is no limit to deception."

Jericho Shares spokesman Mark Hubbard told KHN that the organization cannot discuss McAuley's work without prior written approval, but does not tolerate misinformation or unethical behavior by its programs.

Statewide, lawmakers and regulators are closely monitoring how health plans are sold. The chairman of the Senate Finance Committee, Democrat Ron Wyden of Oregon, is investigating allegations about the marketing of Medicare benefit plans. In May, the Centers for Medicare and Medicaid Services found that complaints about marketing practices for Medicare benefits and prescription drug benefit plans rose from 15,497 in 2020 to at least 39,617 in 2021.

"Healthcare fraud has grown exponentially," said Delaware Insurance Commissioner Trinidad Navarro, who also chairs the National Association of Insurance Commissioners Anti-Fraud Task Force.

Several factors are driving the increase, Navarro said. Higher health care costs can increase the cost of regulated health plans, such as those eligible for the Medicare Act. Higher costs are pushing more Americans to look for cheaper options that typically don't offer much coverage and can confuse consumers. Such plans have increased during President Donald Trump's administration, Navarro said.

"I don't want to talk politics," said Navarro, an elected Democrat, but the previous presidential administration offered a very simple, alternative plan to the ACA, and I don't think they understood the fraud of the plan. . "

Ultimately, Navarro said, because states are the primary regulators of insurance, preventing health care fraud can be like fraud — when one state moves, fraudsters move to another to set up a business.

To combat this tactic, Navarro said, national insurance regulators have created what they call "consolidation" to share information about bad actors with each other. For consumers, Navarro said regulators are considering creating a public inquiry tool to look into complaints about health insurance brokers, similar to the BrokerCheck tool developed by the Financial Industry Regulatory Authority to monitor stockbrokers.

Currently, he recommends working with a health navigator that helps consumers sign up for plans through the official health insurance marketplace, health.gov. Also, regulators have taken legal action for deceptive sales tactics. In August, the Federal Trade Commission issued $100 million in refunds to consumers it said had been "scammed" by fake health plans. Last year, the Massachusetts attorney general won $515,000 in a consumer compensation lawsuit from an insurance company accused of deceptive sales practices.

Court documents from October show California Attorney General Jericho Shear is investigating the Department of Health and Human Services, which Kelly McCauley said bought the plan without her knowledge, to determine whether it met state requirements for the health department.

Jericho spokesman Sher Hubbard said the company is responding "appropriately" to the attorney general's investigation.

Macauley contacted KHN after reading a June survey of consumers who said they would buy insurance, only to find out later that they had been sold health department memberships.

Hubbard notes that since this story was published, Jericho Shares automatically offers a 72-hour refund to new customers who request a refund within 30 days of signing up and does not allow "outside subscription marketing," member directories and pop-ups. Website added Jericho Share is a healthy sharing service.

The online company responded to McCauley's poor review on the Better Business Bureau website and requested more information about her case. He said he gave this information but did not respond.

McCauley said that after Jericho tried to cancel his direct plan with the company, he called his credit card company to ask the company not to authorize the overpayment. When describing the situation, McCauley said the credit card representative told her, "This is a scam," and offered to try to get all of McCauley's gifts back.

Even if those efforts are successful, McAuley will unknowingly be left with thousands of dollars in medical expenses while uninsured.

He returned to the health insurance market and planned to go with a company he had heard about before.

"Anyway, I just wanted to know that I already have insurance," McCauley said.

Bram Sable Smith: brams@kff.org, besables

ACA registration deadline