Missouri cracks down on fake health plans

The Missouri Department of Insurance is going after companies that market fake medical insurance, the St. Louis Post-Dispatch reports. It has fined eight companies more than $1 million for allegedly selling "bogus health insurance plans" and issued cease and desist orders to 14 companies and individuals that reportedly defradued Missouri consumers.

"In a difficult economy and a time when health insurance is becoming more expensive, these companies took the money from Missouri consumers and ran," state Insurance Director John Huff said in a statement.

Companies sold health-discount plans masked as comprehensive medical insurance, the state's head insurance regulator said. At least 150 Missouri consumers bought memberships with the plans.

The groups market the fake products through junk faxes with phrases like "Group health plan" and "Control your health care costs."

Consumers have found their coverage was less than what they were led to expect. And in other cases, they were not able to reach anyone at the company to cancel their contract or get their medical bills covered.

If the operators of the fake plans continue to violate Missouri law or fail to pay their $130,000 fines, they may face criminal chrages and prison time.

To learn more:
- read the Missouri Department of Insurance, Financial Institutions & Professional Registration's press release
- read the Claims Journal article
- see the Businessweek article
- read the St. Louis Post-Dispatch story

Related Stories:
Fake health plans increasing
FTC, states work to stop fraudulent medical discount plans
Florida tells Association of Independent Managers to stop selling fake health insurance