NSCLC Submits Marketing Complaint

On October 1, 2008, NSCLC submitted a complaint to the Center for Medicare & Medicaid Services (CMS) to alert them to misleading and illegal marketing practices used by brokers to enroll dual eligibles into Health Net’s Special Needs Plan, Health Net Seniority Plus Amber II.

In the complaint, NSCLC told CMS that advocates in the San Francisco Bay Area have received “robo-calls” (automated telemarketing calls with a prerecorded message) that use inaccurate and/or misleading information about Health Net Seniority Plus Amber II, a Medicare Advantage Special Needs Plan (SNP). These pre-recorded messages promised a special program with no premiums for those who have both Medicare and Medi-Cal. If listeners followed the instructions for more information they were connected to sales agents who appeared to be independent brokers soliciting enrollments on behalf of Health Net.  The information provided by the agents included many false or misleading statements. For instance, one agent assured the listener that the new benefits were in addition to and would have no impact on existing benefits. Another agent suggested that the SNP membership would allow the enrollee to go to any doctor without mentioning the doctors would have to be part of Health Net’s network. Agents also made misleading statements about the coverage dual eligibles currently get from Medi-Cal. They emphasized that the Health Net plan they were marketing had no monthly fee and no deductible without acknowledging that dual eligibles already receive the same services with no monthly premiums or deductibles. Agents also provided inaccurate information about enrollment periods, and others refused to provide important follow up information.

NSCLC noted that these robo-calls violate CMS’ marketing regulations and guidance which prohibits activities that could mislead, confuse, or misrepresent the MA organization. Medicare Marketing Guidelines allow outbound telemarketing “solely to solicit requests for pre-enrollment information, describe benefit, and to alert existing beneficiaries to new benefits or health related offers,” but not to sign potential beneficiaries as one of the agents suggested. The Guidelines also require organizations to comply with the National-Do-Not-Call Registry. In addition, the Medicare Improvements for Patients and Providers Act (MIPPA) explicitly prohibits outbound telemarketing.

The NSCLC complaint also reported that brokers marketing Health Net products have been targeting low-income Spanish speaking beneficiaries in Kern County, California. With the use of misleading and inaccurate information, brokers have enrolled monolingual beneficiaries in a Health Net Seniority Plus Amber II plan that is not accepted by their providers. Beneficiaries sign up without fully understanding the plan and continue to see their providers believing that their benefits have not changed. This has resulted in significant medical debt to a number of beneficiaries. Unable to pay the bills, beneficiaries have lost access to the providers and medically necessary healthcare.

NSCLC has requested that CMS investigate the marketing activities of Health Net and its agents, and if violations are discovered, to stop ongoing violations and reprimand Health Net.

Click here to read the Health Net marketing complaint.

Dingell and Stupak Call For Investigation of Health Net and Ask Health Net’s CEO to Cease Outbound Calls

House Energy and Commerce Committee Chair John Dingell and Energy and Commerce Oversight and Investigations Subcommittee Chair Bart Stupak have requested CMS to investigate Health Net’s telemarketing abuses reported by the National Senior Citizens Law Center. In an October 14 letter to HHS Secretary Michael Leavitt and HHS Inspector General Daniel Levinson, they asked CMS to require Health Net to immediately suspend further marketing activities, to impose monetary sanctions, and to consider prohibiting Health Net from participating in the Medicare Advantage program. The Committee has also requested that CMS provides dual eligible beneficiaries enrolled by Health Net within the past year with information on the limitations imposed by their plans, and to ensure that enrollees are given the option to retroactively disenroll from the plan. Dingell and Stupak have also requested that the Office of Inspector General investigate whether Health Net or its agents have engaged in Medicare fraud. Click here to read the full version of the letter.

In addition, Chairmen Dingell and Stupak notified Health Net that they are under Committee investigation for allegations of fraudulent marketing of their Medicare Advantage (MA) plan. Writing to Jay Gellert, Health Net’s President and CEO, the Committee noted that the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) expressly prohibits companies that offer MA plans from engaging in outbound telemarketing and that, based on NSCLC’s report, Health Net has violated Federal law when its sales agents attempted to persuade beneficiaries to enroll during outbound calls. The letter also raised the Committee’s concerns about fraudulent and minsleading information provided in such calls as well as about aggressive and misleading sales tactics targeted at Spanish speaking beneficiaries.  Dingell and Stupak requested that Health Net immediately notify all its agents selling its MA plans to cease outbound sales calls and to identify any agents that have violated Federal prohibitions. They also requested Health Net to contact all dual eligible Medicare beneficiaries enrolled in its plans within the past year to ensure that they understand their plan. Click here to find the full version of the letter.

Senate Special Committee on Aging Calls for Immediate Action by the FCC, FTC, and CMS on Unscrupulous Marketing Practices

Ranking Member Gordon Smith of the Senate Special Committee on Aging, wrote to the chairmen of Federal Communications Commission and the Federal Trade Commission and the Administrator of the Centers for Medicare and Medicaid Services requesting reports on current enforcement actions and on legislative changes needed to prevent further abuses..  In an October 17 letter, Senator Smith cited NSCLC’s complaint about telemarketing abuses and expressed his concern about inadequate oversight of third-party telemarketers. He stated that plans are using “third-party telemarketers for sales leads and enrollment activities to circumvent the new regulations.” With open enrollment season approaching, Smith has requested that the FCC, FTC, and CMS work in cooperation to immediately identify any enforcement gaps on the oversight of telemarketers offering MA and a PDP plans and to ensure accountability for unscrupulous sales and marketing practices. Click here to find the full version of the letter.

Open enrollment season for Medicare Advantage and the Prescription Drug Program will begin on November 15^th and seniors will once again become the target of high pressure sales tactics. Advocates and beneficiaries should be alert for unscrupulous marketing practices and report any violations immediately to CMS.  NSCLC would also be very interested in hearing about abusive marketing practices.  Please contact Oakland@nsclc.org.