California Insurance Commissioner John Garamendi has issued a cease and desist order to the National Employers Network, LLC, for operating without a license, putting its policyholders in serious financial peril.
The firm, doing business as ePEOLink, offered and provided medical, dental, and workers’ compensation insurance to small employers in California who were victimized by the company. It accepted premiums, issued proof of coverage, and handled and paid claims, all without proper licensing from the California Department of Insurance.
Consequently, firms that bought this “coverage” from ePEOLink now face financial danger if claims are filed and the policies they secured are found to be invalid. Several employers who bought policies from ePEOLink have since discovered that premiums they paid have not been used to secure coverage for employees’ hospital and provider medical bills.
Also named in the Cease and Desist order is Integrated Professional Insurance Services Inc., (IPS) of Bakersfield, a licensed Third Party Administrator that acted as ePEOLink’s claims administrator. Individuals named include Roger and Dawn Jeffrey of San Diego, Steven W. Hendricks of Turlock; Fred Roh and Jacqueline Holovka of Coeur d’Alene, Idaho.
Hendricks a licensed Life Agent, solicited, negotiated and effected contracts of insurance on behalf of ePEOLink. Roger Jeffrey, Dawn Jeffrey, Roh and Holovka are charged with soliciting, negotiating and effecting contracts of insurance on behalf of ePEOLink in this state without holding a license.
Jeffrey and his daughter, Dawn, currently operate OutsourceNow, Inc., a business processing organization headquartered in La Mesa, San Diego County. Their Web site, OutsourceNowInc.com says that they provide health care plans and human resources, benefits and payroll systems for small to mid size companies.
Investigators found that in one case the unpaid medical claims of one El Cajon family, Don and Maria Gastineau, are estimated at close to $1 million. The Gastineau’s 2-year-old daughter Carli has had three heart surgeries at Children’s Hospital in San Diego, but ePEOLink has failed to pay the Gastineau’s medical bills.
If the firms and individuals violate the order, Commissioner Garamendi can impose a fine of up to $5,000 for each day that the cease and desist order is violated.
PEOs, also known as labor leasing or employee leasing organizations, provide a variety of services, such as payroll, human resources services and health and workers’ compensation insurance to employers. PEOs often claims to provide insurance at discounted group rates, which is not always the case.
Employers who have any leads to further this ongoing investigation or who have contracted with National Employers Network, LLC, ePEOLink, or any of the individuals named in the cease and desist order, are urged to contact the California Department of Insurance, Valencia Investigation Division at (661) 253-7500.
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