Companies pay for ‘deceptive’ health plans

BOSTON – An insurance company and its subsidiary have agreed to pay $1.3 million to settle allegations that they deceptively marketed and sold a discount health plan to hundreds of Massachusetts consumers, Attorney General Martha Coakley announced last week.
According to a release, the settlement with Guarantee Trust Life Insurance Co. and its subsidiary Vantage America Solutions Inc. is in addition to a previous default judgment of $2.4 million against two other companies that were co-defendants in the lawsuit first filed in 2009.
The consent judgment requires the companies to pay $1.3 million, including restitution and civil penalties. The settlement prohibits the companies from misrepresenting a discount health plan as sufficient to comply with Massachusetts laws requiring health insurance coverage.
The companies are also prohibited from marketing or selling a product that is not an insured health plan as defined by state law referenced in the settlement as health insurance, and from violating the regulations governing discount health plans and organizations.
Filed in 2009, the complaint alleges the companies “deceptively marketed” and sold a discount health plan to consumers, falsely representing a plan as meeting the state’s health insurance coverage mandate, and misleading consumers to believe that the plan was health insurance. •

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