Online Ads for Skimpy Health Plans Follow Consumers

(This story, by Steven Findlay, was provided by Kaiser Health News)

Consumers shopping for insurance online last fall — using search terms such as “Obamacare plans,” “ACA enroll” and “cheap health insurance” — were most often directed to websites that promote individual health plans that didn’t meet consumer protections of the Affordable Care Act, according to a new study.

They also failed to get adequate information about those plans’ limitations, according to the analysis by researchers at Georgetown University’s Center on Health Insurance Reforms. The study probed online marketing practices in eight states.

“It was disturbing, but not unexpected, to find such a high proportion of misleading ads and come-ons,” said Sabrina Corlette, the lead author. “That raises the risk that consumers could be duped into buying health insurance that they think offers comprehensive and secure coverage but does not.”

The study focused primarily on the marketing of short-term plans, which don’t have to meet most ACA provisions, such as the requirement to cover preexisting conditions. The researchers found that regardless of the search term used, companies promoting or selling only these kinds of plans dominated the results.

Insurance regulators from each of the states told Corlette’s team that tracking the marketing and sales of short-term plans is challenging, as is educating consumers about the risks of limited coverage.

Michael Conway, Colorado’s interim insurance commissioner, told Kaiser Health News in an interview that he has a “high level of concern” that the marketing tactics the study found could have drawn unsuspecting consumers into selections that do not meet their needs.

“We are on alert for complaints,” Conway said. “If we have to strengthen our regulations on marketing, we will.”

Eric Cioppa, Maine’s insurance superintendent, said in an interview that his office has no evidence that consumers unknowingly purchased short-term plans based on misleading online marketing.

“We’ll respond accordingly and aggressively if we find that took place,” Cioppa said.

But Corlette said the findings provide early evidence that after regulatory changes by the Trump administration, some insurers are aggressively marketing short-term plans as a replacement for traditional health insurance, without fully informing consumers of the limits of the skimpier coverage.

That could warrant stronger federal and state oversight, she said.

The study, funded by the Robert Wood Johnson Foundation, looked at online marketing in Colorado, Florida, Idaho, Maine, Minnesota, Missouri, Texas and Virginia. Those states were selected to reflect diverse geography and regulatory approaches, according to the researchers. Of the eight, Colorado and Minnesota require short-term plans to adhere to a shorter contract duration than required by federal law.