The FTC is issuing refunds to 463,629 customers who allegedly purchased fraudulent health plans misrepresented by Benefytt Technologies as Obamacare or comprehensive health insurance.
Benefytt, operating under various aliases including Health Insurance Innovations, used aggressive marketing tactics and fake websites to deceive customers into buying fake policies with high monthly payments, resulting in minimal coverage and unexpected charges.
As part of a settlement, Benefytt agreed to reimburse over $100 million to affected customers, with former executives permanently barred from marketing healthcare-related products. Affected customers who paid Benefytt $1,000 or more between 2017 and 2022 will receive refunds automatically, without the need to file a claim, with checks expected to arrive within two weeks. It is advised to cash or deposit refund checks promptly upon receipt, as they expire after 90 days. For further inquiries, consumers can contact the refund administrator, Epiq Systems, at (888) 574-3126.
Refunds are being sent by the Federal Trade Commission to customers it claims purchased fraudulent health plans that Benefytt Technologies misrepresented as Obamacare plans or comprehensive health insurance.
Refunds are being sent by the Federal Trade Commission to customers it claims purchased fraudulent health plans that Benefytt Technologies misrepresented as Obamacare plans or comprehensive health insurance. (Photo : by CHARLY TRIBALLEAU/AFP via Getty Image)
Benefytt's Deceptive Practices and Legal Action
According to the FTC's August 2022 lawsuit, Benefytt, operating under many identities including Health Insurance Innovations, employed aggressive marketing and phony websites in a plan to trick individuals looking for health insurance into purchasing fake policies with exorbitant monthly payments. Customers of Benefytt were frequently charged for extra things they never agreed to buy after purchasing the poor insurance, which provided minimal coverage, even if they had sought a cancellation.
The organization claims that in addition to receiving monthly invoices totaling hundreds of dollars, Benefytt clients frequently incurred enormous medical expenses because they mistakenly believed their insurance would cover them.
Samuel Levine, head of the Federal Trade Commission's Bureau of Consumer Protection, stated in a statement at the time the initial lawsuit was filed, "Benefytt pocketed millions selling sham insurance to seniors and other consumers looking for health coverage."
As part of the settlement, Benefytt agreed to pay over $100 million to reimburse customers, and former vice president Amy Brady and CEO Gavin Southwell were permanently barred from marketing or selling any items linked to health care. In accordance with the settlement, Brady is also prohibited from telemarketing.
The Federal Trade Commission (FTC) revealed on Tuesday that it is issuing checks to 463,629 customers who paid Benefytt $1,000 or more between 2017 and 2022. Here are the key points to be aware of regarding this development: Affected customers who made payments of $1,000 or more to Benefytt during the specified period will receive a refund.
As is customary in most FTC cases, impacted customers are not required to submit a claim to receive compensation. The refund checks will be sent out automatically and are expected to arrive within the next two weeks. Upon receipt, it is advised to promptly cash or deposit the refund checks, as they have a validity period of 90 days. For further information, consumers can contact the refund administrator, Epiq Systems, at (888) 574-3126.
