The U.S. District Court agreed with The Federal Trade Commission (FTC) request to temporarily shut down the operations of the South Florida company Simple Health Plans – a precursor to a permanent shut down.
Since October 2013, the health plan pitched consumers comprehensive health insurance or its equivalent – sometimes luring shoppers on lead generation websites claiming to provide information on ACA plans.
Simple Health Plans or their affiliates led consumers to believe they would receive a preferred provider organization (PPO) health insurance policy for a nominal copay.
Shoppers believed they were purchasing plans that covered:
- preexisting conditions
- prescription drugs
- primary and specialty care treatment
- inpatient and emergency hospital care
- surgical procedures and
- medical and lab testing
In some of its advertising materials and campaigns, the health plans’ falsely claimed an affiliation with AARP and the Blue Cross Blue Shield Association.
What consumers received from Simple Health Plan’s promises were an assortment of products including limited benefit plans, medical discount and wellness program memberships. It also hawked GOP supported short-term, limited duration insurance products as an alternative to ACA plans.
The complaint reads,
In the past three years alone, Defendants’ scheme has generated over $100 million in revenue. Unfortunately, Defendants’ scheme also has left tens of thousands of consumers who thought they had purchased comprehensive health insurance without such coverage. In addition to paying monthly “premiums” for Defendants’ limited benefit plans and medical discount memberships, many of these consumers have incurred substantial medical expenses under the mistaken belief that these expenses would be covered by the health insurance they thought they had obtained from Defendants.
The judge froze Simple Health assets and appointed a receiver to take control of the companies.
Read more from The New York Times
Read the article from Fierce Healthcare