Tuesday, April 13, 2010

Health insurance scams?

Bogus health plans that advertise comprehensive coverage at bargain prices are on the rise, luring desperate consumers to pay for policies that won't cover their medical bills, state insurance commissioners say.

In recent weeks, Missouri regulators have cracked down on 13 companies. California has ordered firms to stop selling misleading and unlicensed health discount cards. Tennessee regulators have seized a company they allege has collected more than $14 million from people across the U.S. — then stranded them with unpaid bills.

"I've never seen anything like this," said Oklahoma Insurance Commissioner Kim Holland, who said the bad economy has fueled the uptick in scams.

James Quiggle, spokesman for the Coalition Against Insurance Fraud, which represents consumers and insurance companies, said: "There's high unemployment, health premiums are expensive and tens of millions of people have no health coverage. This is an ideal breeding ground for scams."

Among 37 insurance bureaus responding to a coalition survey last fall, 57% reported increases in health plan scams.

Wait until Obamacare kicks in, with its mandatory membership, big deductibles, large co pays and limited coverages. Everyone who thinks they're going to get "free health insurance for all" will feel they were scammed.

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