October 14, 2013

Brokers simplify, confuse health exchange shopping

An industry group warns of bogus websites and unsolicited calls by people claiming they need personal information to help customers enroll in insurance.

By Emery P. Dalesio
The Associated Press

This month’s glitch-filled rollout of the health insurance marketplaces created by federal law is a business opportunity for brokers and agents, but regulators warn that it also opened the door for those who would seek to line their pockets by misleading consumers.

click image to enlarge

The Associated Press Insurance broker Jeff Lindstrom, right, meets with Brandi and Darren Litchfield to discuss health insurance plan options, at their home in the Seattle suburb of Bothell, Wash. Darren works for a startup company that doesn’t yet offer an employee insurance plan, so they invited Lindstrom to outline the options of different healthcare plans that he offers as a broker.

New Hampshire’s insurance commissioner sent a cease-and-desist letter last week to an Arizona company he accused of building a website to mislead health care shoppers into thinking it was the official marketplace. The site was taken down Friday.

Regulators in Washington state and Pennsylvania also have told agents to change websites that seemed likely to convince consumers they were connecting to government-run sites. Connecticut’s insurance department warned agents and brokers this summer that it will take action against agents who mislead consumers or design sites to replicate the state-run exchange.

An organization run by the top insurance regulators in each state recently issued an alert on the potential for scams related to the marketplaces. The National Association of Insurance Commissioners advised consumers that bogus sites have been spotted and warned people to beware of unsolicited calls by people claiming they need personal information to help them enroll in insurance.

Not all insurance agents are licensed to sell insurance on the exchanges, and buying a policy from one of them could leave consumers without the tax subsidies that make the health insurance affordable. Consumers who seek an insurance professional’s help are urged to make sure they know who they’re dealing with.

“We all need to be on the lookout right now. We don’t want consumers to get confused,” said Jessica Waltman of the National Association of Health Underwriters, a trade association representing agents and brokers.

Susan Johnson, the Northwest regional director for the U.S. Department of Health and Human Services, said while some brokers are passionate about helping, others are seeking to take advantage.

In one such case, a state-licensed broker in suburban Seattle bought the domain name washingtonhealthplanfinder.org and built a website with fewer computer glitches than the state’s new health insurance marketplace, wahealthplanfinder.org. The brokerage’s site told customers: “Welcome to the Exchange!” in big print until the state insurance commissioner asked for changes to avoid confusion.

“You don’t want to go to the wrong portal,” Johnson said.

The insurance broker, Jeff Lindstrom, said he thought he was being creative when he bought 40-50 domain names to bring in new customers. He said he is not trying to confuse the public. Lindstrom’s toll free phone number was also very close to the official call center number, said Stephanie Marquis, a spokeswoman for Washington’s insurance commissioner.

In New Hampshire, newhampshirehealthexchange.com offered free price quotes on insurance, but it wasn’t affiliated with the state or the federal government, which is running New Hampshire’s official online market. The site was taken down days after the state sent a cease-and-desist letter.

“It put itself forward as offering health insurance through the exchange, and consumers are naturally misled by that into thinking it’s the government site,” said Deputy Insurance Commissioner Alex Feldvebel.

The insurance department took action after getting a complaint from a small business owner who called a phone number on the misleading site.

“He called and ended up talkng to someone who said, ‘Unless you make a choice today, the price is going to go up,”’ Feldvebel said.

A man who answered the phone declined to comment at the company identified as running the site, Arizona-based Steffen Financial.

In Pennsylvania, a consumer law group this summer tipped off regulators about a licensed broker’s website that featured a logo mimicking the state seal and telling visitors: “Welcome to the Pennsylvania Health Exchange!” The broker took down PAhealthexchange.com a day after the state insurance department’s enforcement bureau called.

(Continued on page 2)

Were you interviewed for this story? If so, please fill out our accuracy form

Send question/comment to the editors




Further Discussion

Here at PressHerald.com we value our readers and are committed to growing our community by encouraging you to add to the discussion. To ensure conscientious dialogue we have implemented a strict no-bullying policy. To participate, you must follow our Terms of Use.

Questions about the article? Add them below and we’ll try to answer them or do a follow-up post as soon as we can. Technical problems? Email them to us with an exact description of the problem. Make sure to include:
  • Type of computer or mobile device your are using
  • Exact operating system and browser you are viewing the site on (TIP: You can easily determine your operating system here.)