A Florida-based insurance agency, Health Plan Intermediaries Holdings, LLC (“HPIH”) d/b/a Health Insurance Innovations has entered into a consent decree with the Massachusetts Attorney General to settle allegations that it used deceptive and unlawful practices to sell health plans to Massachusetts consumers.
The Massachusetts settlement with HPIH follows HPIH paying a $2 million market conduct fine in California and settling a nationwide class action over its sales practices for $27.5 million (see below).
Complaint filed by the Attorney General alleged deceptive selling of unauthorized health policies
According to the Attorney General’s complaint filed in Suffolk Superior Court, HPIH’s agents and independent contractors sold health insurance plans to Massachusetts consumers from the Unified Life Insurance Company. The Unified Life policies were not authorized for sale in Massachusetts. The complaint alleged that HPIH and its agent engaged in deceptive selling tactics including claiming that the unauthorized health insurance covered services that the policies sold, in fact excluded, describing limited health insurance as “comprehensive,” and passing off coverage limitations as positives, rather than negatives.
The practices complained of by the Attorney General all arose before HPIH stopped selling Unified Life’s policies in Massachusetts in 2017. The insurance company involved, Unified Life, settled in 2017 with the Attorney General by the payment of $2.8 million in restitution and penalties. See Agency Checklists’ article of April 4, 2017, Mass. AG Stops Illegal Health Insurance Sales and Recovers $2.8 Million From Insurer.
Consent decree requires payment of consumer restitution, a fine, and the costs of the investigation
HPIH resolved the Attorney General’s complaint by agreeing to a consent decree. Under the terms of the consent decree approved by the Superior Court, HPIH will pay up to $515,000 in restitution to insureds who bought the health plans, $10,000 for the cost of the Attorney General’s investigation, and a $100,000 penalty payable to the Commonwealth.
Under the consent decree, HPIH is also banned from selling non-Medicare-related health plans in Massachusetts for a year.
The Attorney General’s recovery follows other actions against HPIH for its sales practices
The sales practices of HPIH in selling health policies to consumers have recently resulted in HPIH paying a $2 million fine in California and the $27.5 million settlement of a nationwide class action in Florida.
In August 2021, HPIH agreed to pay a $2 million fine to the California Insurance Department. The fine resolved a pending administrative complaint that HPIH, and its third-party agents knowingly marketed and sold insurance policies that were being misrepresented as Affordable Care Act-compliant to consumers, misleading consumers with limited coverage and large out-of-pocket costs.
In February 2021, a federal court in Florida certified a nationwide class of 200,000 insureds which accused HPIH of defrauding customers out of millions of dollars by misrepresenting the benefits of their insurance policies.
In September 2021, HPIH agreed to settle the class action. The settlement agreement provides that the HPIH defendants companies will pay a total of $27.5 million to settle all claims in the class action and will follow certain business practice changes relating to the sale of limited benefit indemnity health insurance.
Attorney General seeks consumers to report deceptive health insurance sales
“Massachusetts has strict regulations regarding the marketing and sale of health insurance for a reason: to prevent companies like this one from taking advantage of people regarding something as serious and essential as healthcare” Attorney General Maura Healey said, in announcing the consent judgment. “We took action against this company for engaging in deceptive practices in violation of these regulations and secured monetary relief for harmed consumers.”
In the past, the AG’s Office has taken action against other insurance companies for related and similar issues regarding health plans. The Attorney General is recommending that consumers concerned about illegal health insurance practices in Massachusetts to call the AG’s Health Care Helpline at (888) 830-6277.
The Attorney General’s team involved in the HPIH settlement
This matter was handled by Assistant Attorney General Emiliano Mazlen, with assistance from Division Chief Eric Gold of AG Healey’s Health Care Division, and Anthony Crespi of AG Healey’s Civil Investigations Division.