Gov. Tim Pawlenty recently alerted Minnesota consumers to misleading health plan advertisements that have been faxed to Minnesota businesses and individuals. These plans do not provide insurance coverage and do not directly pay hospital or doctor bills, the governor said in a statement.
The Minnesota Department of Commerce, which regulates insurance, issued cease and desist orders to 12 entities that have allegedly engaged in false and misleading advertising of health care plans:
—Affordable Health Care/Continental Health, San Diego, Calif.
—US Healthcare /Family Care/File, Houston, Texas
—Smart Health Care Solutions, Tempe, Ariz.
—Family Choice, Newport Beach, Calif.
—Peoples Health Plan/Health Care Advantage, Deerfield Beach, Fla.
—Med Health Plus or One
—Equal Access Health, Arlington, Texas
—Colonial Health, Houston, Texas
—All American Health Plan, Houston, Texas
—Protective SmartHealth Plus
—Extra Health Family
—American Medical Services, Clearwater, Fla.
None of these entities is authorized to sell insurance in Minnesota, according to the statement.
The advertisement for each company employs a similar approach and include terms such as “health plan,” “healthcare,” “insurance,” “benefits” and “medical program.” One advertisement used Spanish terms such as “beneficios” and “programa medico.”
The plans offer to enroll individuals or families for a monthly fee to receive discounted services from participating health0care providers, both medical and dental. In some cases, a one-time enrolment fee was required.
In 2004, cease and desist Orders were also issued to:
—Family Health, also known as Family Health Benefits, Family Healthcare, A&B Marketing, AB National Marketing, of Bellaire and Houston, Texas
—Health One Inc. of Houston, Texas and Med One Gold of Plainfield, New Jersey.
Minnesota law defines “health plan” as a policy or certificate of accident and sickness insurance. The advertisement only offers discounts in a preferred provider organization. For example, if a person who purchases one of the advertised programs visits a physician participating in the PPO, they would be entitled to a discount, but would not otherwise be “covered.” The advertised program would make no payment to the physician on behalf of the patient.
The Department of Commerce is alleging that each of the 12 entities have violated Minnesota insurance law in regard to solicitation of a health care plan. They are ordered to stop any further deceptive or misleading advertising and may not make any other misrepresentations relating to the business of insurance in Minnesota.
Each may request a hearing.
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