Insurance Agent Prohibited from Selling Medicare Advantage Plans

Insurance Agent Prohibited from Selling Medicare Advantage Plans

The California Department of Managed Health Care (DMHC) has issued an order barring a Folsom health insurance agent from selling Medicare Advantage plans, due to unscrupulous and deceptive practices against nearly a dozen local senior citizens. The agent, Nadia King, cancelled the Medicare coverage of elderly consumers without their consent or knowledge, and then enrolled them in private Medicare Advantage plans she represented, causing some to unknowingly incur unexpected medical bills.

Deceptive marketing of Medicare Advantage products to senior citizens is a growing problem in California and across the nation. California Health Advocates started receiving complaints from beneficiaries about deceptive marketing of Medicare Advantage products over 3 years ago, and has been working with both DMHC and California Department of Insurance (CDI) in finding resolution and ways for the 2 departments to work together in stopping such practices. California Department of Insurance has the power to revoke an agent’s license (as agents are licensed by CDI), and DMHC, according to state law, has the power to bar an agent from selling certain products if it is determined that a solicitor makes misrepresentations to consumers or acts in a manner that may expose them to substantial risk.

In this case of Naida King, the DMHC has indefinitely barred her from operating as a solicitor of Medicare Advantage plans to individuals eligible for Medicare. The order alleges that King solicited unsuspecting Medicare enrollees, using deceptive sales tactics to enroll them into the particular Medicare Advantage plans that she was selling.

Eleven local victims are identified in the order. In most cases, unsolicited contacts with elderly Medicare recipients either in their homes, by telephone, or some other means, resulted in Ms. King enrolling the victims in various Medicare Advantage plans, often without their knowledge or consent. Some of these victims experienced delays in medical treatment as a result of the unwanted change to their health coverage, or unexpected out-of-pocket charges, of up to $6,000 in one case.

DMHC, CDI, CHA and our Senior Medicare Patrol (SMP) program are collaborating in ongoing efforts to protect consumers from health care fraud and fraud insurance products. Both CDI and DMHC are actively investigating Medicare Advantage marketing abuse cases, CDI revoking some insurance licenses and DMHC issuing sanctions against insurance agents engaged in fraudulent activities. In addition, the DMHC has also been ordering unlicensed and fraudulent discount health plans to cease operation or seek licensure to ensure that the plans are selling a legitimate product, and has shut down a phony labor union health coverage scheme that put hundreds of consumers at risk of losing coverage.

Consumers and advocates with questions about health care fraud can contact our SMP program at 714-560-0309. People can also contact the DMHC Help Center for assistance in identifying legitimate health products at 888-466-2219, and CDI’s consumer hotline at 800-927-4357 for reporting insurance agent misconduct.

Also, below are a few reminders on how to avoid deceptive health care marketing schemes:

  • Do not give personal information, such as Social Security numbers, bank account numbers, or credit card information.
  • Be wary of unsolicited calls or visits at home, or an approach by someone at your doctor’s office, pharmacy or hospital.
  • Do not take calls from someone claiming to be from Social Security or Medicare. Legitimate representatives from these programs will not call or come to your home unless you have contacted them to request it.
  • Read and understand the health plan information.
  • Consult family and friends before purchasing any health plan.

For general information on Medicare fraud and abuse, see our section Medicare Fraud.

Our blogger Karen J. Fletcher is CHA's publications consultant. She provides technical expertise, writing and research on Medicare, health disparities and other health care issues. With a Masters in Public Health from UC Berkeley, she serves in health advocacy as a trainer and consultant. See her current articles.