Insurers Misled Customers on ObamaCare: Report

Hid benefits from customers, says Talking Points Memo

By Ruth Brown,  Newser Staff

Posted Nov 4, 2013 4:57 PM CST

(Newser) – Insurers nationwide are scrambling to retain customers who might ditch them for a better plan through the ObamaCare marketplace—and some have engaged in questionable practices to do so. Talking Points Memo has identified several instances of insurers contacting customers to tell them their current policies are expiring, and encouraging them to sign on for new, sometimes higher-priced ones before the marketplaces launched in October. In one case, a woman in Seattle received a letter saying the insurer had found a new plan for her, and if it didn't hear from her, she would be rolled over to this new policy. "If you're happy with this plan, do nothing," LifeWise of Washington wrote.

What LifeWise didn't mention was that the new policy would cost her $300 more a month—or that she had much better options available to her on the insurance exchange. When she visited the marketplace, she found a cheaper plan and a number of new tax credits for which her family was eligible. In all, she saved $1,000 a month compared with the new plan the LifeWise had tried to sign her on to. Insurers say it's just business, but regulators are not impressed. Last month, Humana was fined $65,000 for sending similar letters in Kentucky, and also got a slap on the wrist in Colorado. "The letter appeared threatening," says a spokesman for Colorado's insurance division. "You've got to let people know their options. You can't make it seem like they have to stick with your company."

An unidentified person clasps his hands as a representative for Marketplace Nebraska, a health insurance broker under the new Affordable Care Act, explains the health insurance enrollment process.
An unidentified person clasps his hands as a representative for Marketplace Nebraska, a health insurance broker under the new Affordable Care Act, explains the health insurance enrollment process.   (AP Photo/Nati Harnik)
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