Initial Discount Medical Plan Examinations Show Problems
TALLAHASSEE, Fla. – The Florida Office of Insurance Regulation (Office) today finalized its first three examinations of Discount Medical Plan Organizations (DMPO). DMPOs are not health insurance, but offer negotiated discounts on health, dental, vision and/or other medical services. Legislation passed two years ago was intended to regulate this growing industry, as Florida's consumers were often misled into confusing the less expensive DMPOs with comprehensive health insurance plans.
"The first three exams show problems with this industry. We found several instances of companies using unapproved forms, using misleading and prohibited words like ‘co-pay' and ‘comprehensive', and not being upfront with the required disclosures. These problems are precisely why the Legislature took action to regulate these programs," Commissioner McCarty stated. "The good news is we have seen a significant decline in the number of consumer complaints regarding DMPOs, so the new law is working to protect consumers."
The Market Investigations Unit intends to examine all newly licensed Discount Medical Plan Organizations for the period beginning when the new law became effective April 1, 2005. These examinations are being performed in an effort to identify areas of noncompliance as soon as possible so corrective action can be taken to prevent harm to the consumers of Florida. The first three companies examined included Starmark Benefits Incorporated, Aetna Life Insurance Company, and Compbenefits Company.
The examination also discovered instances of improper refunds for cancellations, disclosures not being the required size on the websites, and the use of other misleading language in company advertising such as: health, pharmacy, disability, long-term care, and fee-for-service.
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