Health care navigators, insurance regulators see increase in questionable sales pitches

With a growing number of people signing up for health coverage under the Affordable Care Act, regulators and health insurance navigators are seeing a troublesome counter-trend: an uptick in people enticed to sign up for coverage that isn’t right for them.

“Every day I hear from people who are grateful to have their health insurance that’s affordable and that allows them to get the health care they need,” says Julia Garvey, who helps patients sign up for coverage in the Fox Valley.

Then, from time to time, there are the red-flag cases — clients who unwittingly get hooked by unscrupulous agents or brokers who pressure them with misleading pitches, often costing them more than they’d otherwise have to pay.

“This is an issue nationally,” Garvey says. “It’s happening in other states as well.”

In February the Wisconsin Office of the Commissioner of Insurance (OCI) issued a bulletin alerting insurers, insurance brokers and agents as well as others of an increase in complaints “alleging the improper sale of Affordable Care Act-compliant health plans.” Some of those have involved agents and brokers who “have sold unsuitable policies and/or misrepresented the terms of these policies,” the bulletin stated.

Misrepresenting an insurance contract and recommending a health insurance policy that is “unsuitable to the applicant” are both against Wisconsin laws, the Feb. 21 OCI bulletin pointed out.

National problem

“This is an issue we’re seeing across the country,” says Sarah Smith, OCI director of public affairs, and it’s a subject that has been under discussion at the National Association of Insurance Commissioners.

The right health insurance is important for people to be able to access health care, Smith said, and it also helps ensure better financial security. When people get drawn into the wrong plan, “that can put both their health and financial security at risk.”

The Affordable Care Act wrote into law new protections for health insurance customers, such as preventing insurers from excluding or charging prohibitively expensive premiums for people with a preexisting health condition. It also established a national network of health insurance marketplaces — HealthCare.gov — for individual consumers to buy coverage if they are not covered by a health insurance plan, such as through their work.

Caroline Gomez-Tom, enrollment network and accessibility manager for Covering Wisconsin, said the increase in problem signups surfaced in the middle of 2023. It coincided with the resumption of a requirement for Medicaid patients to qualify  annually for the low-income health plan after three years of continuous coverage during the COVID-19 pandemic.

Covering Wisconsin is a federally approved navigator that helps people free of charge to understand the health care marketplace and their health insurance options.

“There were a large number of people transitioning from Medicaid to the health insurance marketplace,” Gomez-Tom says. While many of those former Medicaid patients may have been able to sign up for a plan through HealthCare.gov or with the help of navigators, others found their way to similarly named websites that weren’t among the trusted state, federal or nonprofit agencies.

Garvey is a policy advisor and navigator for the Partnership Community Health Center, another authorized navigator agency serving the Fox Valley.

“When you use a search tool to seek out health insurance, it’s very easy to land on a website that is not one of the secure government websites” or that of an official nonprofit partner, Garvey says.

A costly wrong call

A client who had worked with Gomez-Tom in 2022 and signed up for a plan at HealthCare.gov decided when the renewal time came in 2023 to handle it independently. The woman later told Gomez-Tom she thought she was calling a HealthCare.gov call center, but wound up talking to an insurance broker’s call center in Florida.

A call center operator signed the woman up for a HealthCare.gov policy and told her she would owe a $241 premium.

“When she reached out to me to double check their work, I was able to see in her HealthCare.gov account that they did enroll her in a plan, but the premium was only $65, and she had a charge on her debit card for the remaining amount of $174,” Gomez-Tom wrote in a complaint to OCI. “They essentially tacked on a fee without her knowledge.”

Gomez-Tom explained to the woman that the fee was unnecessary and helped her cancel the plan and re-enroll directly at HealthCare.gov.  

“When we called them to cancel, they would not acknowledge that they added an additional fee to her HealthCare.gov premium,” Gomez-Tom wrote in the OCI complaint. The Florida agency was “adamant that they [were] the only affiliated group through the [HealthCare.gov] Marketplace and that she would not find others who could help her for less.”

In the end the woman was able to recover the money she paid out by lodging a fraud complaint through the credit card company whose card she had used to sign up with the Florida broker.

Bobby Peterson, executive director of ABC for Health, says the Madison-based nonprofit staff “have seen an uptick in fraudulent Marketplace applications submitted by unauthorized third parties.” ABC for Health assists low- and moderate-income people who are addressing health coverage, medical debt and related issues, and just this week has been working with an elderly man who doesn’t speak English well and was improperly enrolled in a HealthCare.gov plan, Peterson said.

What to watch for

Professionals tasked with helping  people obtain appropriate health care coverage cite several red flags that people who are trying to sign up for health insurance under the ACA should watch for.

Those include cold calls from someone offering to sell health insurance, and high-pressure tactics from agents who call.

“People should be vigilant if someone is being aggressive in getting you enrolled in a particular plan or signing you up for something you’re not sure you understand,” Smith says.

Navigators also warn consumers to watch out for pop-up ads on social media or other internet sites, particularly highlighting “zero-dollar coverage.”

The ACA does include premium subsidies that can sharply lower the cost of health care for low- and moderate-income people. But the ads that turn up online often are accompanied by fine print that many prospective policyholders won’t understand.

“Consumers who do not know program rules may in fact qualify for Medicaid by their income,” Garvey says. “But if a bad actor is reaching out claiming to offer a plan that will also cost nothing, they may be enticed to enroll in something they don’t understand — without understanding whether they’re better served by Medicaid.”

When problems do arise, Smith says, OCI encourages customers to file complaints with the agency. Specific details will help the agency understand what particular violations if any might have been committed and how best to respond, she says.