A California healthcare company and a Washington healthcare company just pay $145 million in separate matters to resolve Federal Trade Commission charges over misleading consumers.
Assurance IQ, LLC and MediaAlpha, Inc. will pay a total of $145 million to settle Federal Trade Commission charges that they misled millions of healthcare consumers in two separate actions.
The FTC alleged both Assurance and MediaAlpha deceived consumers and led them to purchase plans that did not provide the promised healthcare coverage, and bombarded consumers with telemarketing and robocalls.
Seattle-based Assurance IQ, also doing business as Assurance, Assurance IQ, and National Family Assurance Corporation, allegedly used telemarketing to deceptively market and sell health plans, specifically short-term medical and limited benefit indemnity plans bundled with supplemental products like telemedicine plans, prescription discount plans, and dental and vision discount plans.
According to the FTC’s complaint, Assurance’s telemarketers made deceptive statements to consumers about the health plans’ actual costs and benefits, including that they provided coverage for preexisting conditions, did not have caps on benefits, allowed access to medical provider networks that would lower consumers’ costs significantly and incorporated supplemental products. The complaint also alleges that Assurance unfairly charged consumers without first getting their express informed consent.
The proposed court order imposes a $100 million judgment against Assurance for violating the Telemarketing Sales Rule, which will be used to provide refunds to consumers. It also prohibits Assurance from making a range of express and implied misrepresentations relating to health plans.
Los Angeles-based MediaAlpha, Inc. and its operating subsidiary QuoteLab, use advertisements and websites claiming to provide health insurance quotes to collect information from consumers looking for insurance, so the information can be sold to telemarketers. In 2024, MediaAlpha sold 119 million leads about consumers, according to the. FTC.
The complaint alleges MediaAlpha has attracted consumers to their healthcare-related lead generation websites using misleading domains such as “ObamacarePlans.com” that imply they are associated with the government and claim that consumers will be able to buy low-cost, comprehensive health insurance that complies with the ACA.
The FTC also alleged that MediaAlpha has hired actors and celebrities to promote a non-existent government “Health Insurance Give Back Program” to drive consumer traffic to its health sites.
The proposed court order resolving the FTC’s allegations imposes a $45 million judgment against MediaAlpha.
Topics California Washington
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