Securities Arbitration Lawyers Blog37,000 Victims Still Paying 6.3 Million Monthly For Limited Health Insurance With Simple Health Plans
Almost 37,000 consumers are left paying $6.3 million in monthly premiums for insurance plans with Simple Health Plans LLC. The Federal Trade Commission is working on permanently closing the company. However, until a federal judge keeps the company permanently closed, the consumers still need to pay.
Simple Health has been shut down since October 31 when it was served a temporary restraining order. The FTC is accusing the health insurance company of running a huge scam that convinced thousands of consumers into thinking they were buying high quality health insurance policies. They were led to believe that the health insurance they were buying would cover things like hospital stays, visits to primary care physicians and specialists, and prescription drugs. In actuality, Simple Health LLC sold their consumers a package of discount plans and limited-benefit hospital coverage that only paid a maximum of $3,200 a year. Simple Health’s co-founder Steven J Dorfman and his affiliated companies made more than $150 million since 2013.
The FTC has filed statements from consumers that state the Simple Health sales representatives assured them that they were purchasing excellent medical coverage. The consumers only realized the truth after they were deeply in debt after medical procedures and unable to pay for their prescription medication with the “health insurance cards” provided by the fraudulent company.
On December 4th 2018, the FTC stated that it learned about the nearly 37,000 consumers still paying for the scam from a third-party administrator of Simple Health, called Health Insurance Innovations. Based on the figures they gave to the FTC, the average customer was paying $170 a month for the insurance.
Representatives from Health Insurance Innovations did not respond to emails asking whether the company is going to refund the premiums for insurance that consumers bought from Simple Health Plans. Health Insurance Innovations is also having issues with regulators.
On December 12th, 2018 the company announced that it had entered into a settlement agreement with regulators, leading into a serious investigation into its sales and marketing practices.
The settlement called for Health Insurance Innovations to pay $3.4 million to improve its monitoring of sales and to develop a disclosures plan so that way consumers are made completely aware of what they are buying.
Once the FTC secured the temporary restraining order and closed down Simple Health, Health Insurance Innovations released a statement on November 2nd saying it was ending its relationship with Simple Health
Bank records examined by the FTC shows that Health Insurance Innovations paid about $145.7 million in commissions to Health Benefits One, also owned by Dorfman.
Silver Law Group is a nationally-recognized consumer fraud law firm headquartered in South Florida representing investors worldwide with their claims for losses due to securities and investment fraud. The firm has successfully recovered multi-million dollar awards for its clients. To contact Scott L. Silver to discuss your legal matter, call toll-free (800) 975-4345 or e-mail him at SSilver@silverlaw.com.