Beware of health insurance that sounds too good to be true – InsuranceNewsNet

It took almost a year to Kelly Macauley realizing the health plan she purchased when looking for insurance coverage last October was not, in fact, insurance.

Of course, some red flags popped up along the way, but when she called to complain, she said, she received an explanation that sounded reasonable enough and forced her to pay it. $700 monthly premiums.

She said she was told her medical bills weren’t being paid because the hospital was submitting them incorrectly. This Jericho Share, the non-profit organization that sent him a membership card that said “THIS IS NOT INSURANCE”, was only the underwriter of his policy, not the actual insurer. That she hadn’t received a welcome package because the company was saving paper and passing those savings on to customers.

Then, this summer, the 62-year-old retired teacher who recently moved from philadelphia cream area to Caroline from the southlearned that his plan only paid off $120 of his hip replacement bill last year, leaving him with a balance of more than $40,000. She said she was assured the procedure would be covered when she sought insurance. But it turns out that the plan she bought wasn’t insurance at all, but rather part of what’s called a shared healthcare ministry.

Shared Health Care Ministries are an alternative to health insurance in which members agree to share medical costs. They are often faith-based and can be cheaper than traditional insurance, although they may not cover medical costs for their members, according to a Commonwealth Fund report.

“It was never mentioned to me,” Macauley said. “I honestly believed I was buying legitimate medical insurance.”

Beginning November, 1st, millions of Americans will purchase health insurance for 2023 during a period known as “open enrollment.” Through the federal and state insurance marketplaces, consumers can purchase Affordable Care Act-compliant health insurance plans and find out if they are eligible for financial assistance.

But experts warn that the rush to buy coverage also presents an opportunity for people selling alternative products, such as short-term health plans and shared healthcare ministries, which are often less expensive than full coverage but offer much less protection. While these alternatives are themselves legal, experts warn that deceptive marketing can trick consumers into buying comprehensive coverage to buy health plans that exclude protections for pre-existing conditions and expose patients to large bills. medical.

“Now is a great time to seek out consumers who are looking for insurance and lead them down the wrong path,” said JoAnn Volkco-director of Georgetown University Center on Health Insurance Reforms.

Volk has identified telltale signs of this wrong path: if the person selling you a plan starts asking about your medical history, or refuses to send you information about the plan altogether, or agrees to provide this information only after you have given them your payment information. According to a 2021 Secret Shopping Report on Deceptive Marketing Practices, co-authored by Volk, a broker incorrectly cited HIPAA, the law to protect patient privacy, as a reason not to share information. health plan information.

“Just made up stuff,” Volk said. “If you commit fraud, there are no limits.”

In a statement to KHN, spokesperson for Jericho Share Marc Hubbard said the organization could not discuss Macauley’s case without his prior written approval, but does not tolerate any misrepresentation or unethical conduct by its programs.

Nationwide, lawmakers and regulators are taking notice of how health care plans are sold. Senate Finance Committee President Ron Wydena democrat from Oregon, investigates complaints about the marketing of Medicare Advantage plans. And in May, the Medicare and Medicaid Service Centers noted that complaints about marketing practices for the Medicare Advantage and Medicare drug plans have increased from 15,497 in 2020 to at least 39,617 in 2021.

‘Healthcare scams have increased exponentially,’ Delaware insurance commissioner says Trinidad Navarrewho also chairs the anti-fraud working group of the National Association of Insurance Commissioners.

Several factors are behind the increase, Navarro said. Rising health care prices can drive up the cost of regulated health plans, such as those that comply with the Affordable Care Act. Higher costs are causing more Americans to seek out cheaper alternatives that typically don’t offer as much coverage and can confuse consumers. These types of plans have proliferated under President that of Donald Trump administration, Navarro said.

“I don’t want to sound political,” said Navarro, an elected Democrat, “but the previous presidential administration was really pushing lean plans and alternatives to the ACA, and I don’t necessarily think they understood the fraud. who was associated with these plans.

Finally, Navarro said, because states are the primary insurance regulators, cracking down on health care scams can be like playing a game of moles — when a state acts, scammers move to a another to open a shop.

To combat this tactic, Navarro said, insurance regulators nationwide created what he described as a “confluence page” to share information about bad actors among themselves. For consumers, Navarro said, regulators are considering creating a public search tool to search for complaints against health insurance brokers, similar to the BrokerCheck tool created by the Financial Sector Regulatory Authority monitor securities brokers.

For now, he suggests working with healthcare navigators, which help consumers sign up for plans through the formal health insurance marketplace, health.gov. Additionally, regulators have taken legal action over misleading sales tactics. In August, the Federal Trade Commission won $100 million in reimbursements for consumers who he says have been “cheated” into bogus health plans. Last year the Massachusetts the attorney general won $515,000 to help consumers from an insurance company accused of misleading sales practices.

Court documents from October indicate California the attorney general is investigating Jericho Share – the health care sharing ministry that Kelly Macauley said she unwittingly purchased a plan from – to see if it met state requirements for shared health care departments.

Jericho Share spokesman Hubbard said the organization was “responding appropriately” to the attorney general’s investigation.

Macauley contacted KHN after reading a June survey of consumers who said they were thinking of buying insurance only to later learn that they had been sold memberships to this health care sharing ministry.

Hubbard noted that since this story was published, Jericho Share automatically provides 72-hour refunds for new consumers who request one within 30 days of signing up, no longer allows “outsourced marketing for signups,” and added a member guide and pop-up to their website that Jericho Share is a health care sharing ministry.

The company responded online to Macauley’s bad review on the Better Business Bureau website, asking for more information about his case. She said she provided this information but never heard back.

After Macauley unsuccessfully tried to directly cancel her Jericho Share plan with the company, she said, she called her credit card company to stop it from approving any further charges from the society. When she described her situation, Macauley said, the friendly credit card representative told her, “It’s a fraud” and offered to try and collect all of her bonuses.

Even if this effort succeeds, Macauley will end up with the tens of thousands of dollars in medical bills she unknowingly incurred while uninsured.

She is new to the health insurance market and is considering choosing a company she has heard of before.

“Whatever it takes,” Macauley said, “I just want to know that I really have insurance.”