The Federal Trade Commission is sending refunds to consumers it says bought into fake health plans falsely marketed by Benefytt Technologies as comprehensive health insurance or an Obamacare plan under the Affordable Care Act.
Benefytt, operating under various names such as Health Insurance Innovations, used aggressive marketing and fraudulent websites in a scheme to lure consumers in search of health insurance into buying bogus policies with high monthly fees, according to the FTC's August 2022 complaint. After buying the bad insurance, which offered little coverage, Benefytt customers where often billed for additional items they never agreed to purchase, even if they had requested a cancellation.
In addition to being billed hundreds of dollars monthly, Benefytt customers often racked up huge medical bills under the belieft they were protected by their insurance, according to the agency.
"Benefytt pocketed millions selling sham insurance to seniors and other consumers looking for health coverage," Samuel Levine, director of the FTC's Bureau of Consumer Protection, said in a statement at the time the original complaint was filed.
Benefytt has agreed to pay approximately $100 million in order to provide refunds to customers as part of a settlement. This settlement also includes a permanent ban on former CEO Gavin Southwell and former vice president Amy Brady from selling or marketing any health care-related products. Additionally, Brady is prohibited from engaging in telemarketing activities as part of the settlement.
Who is eligible for a refund?
The FTC has announced that it will be sending checks to 463,629 customers who paid Benefytt $1,000 or more between 2017 and 2022. Here are some key points to keep in mind:
- Customers who paid Benefytt $1,000 or more between 2017 and 2022 will receive a refund.
- As is common in FTC cases, affected customers do not need to file a claim in order to receive a refund.
- Refund checks will be sent out automatically and should be received within the next two weeks.
- Upon receiving the refund checks, customers are advised to cash or deposit them promptly as they expire after 90 days.
- For more information, consumers can contact the refund administrator, Epiq Systems, at (888) 574-3126.
