The state Commerce Department said it has issued a $50,000 civil penalty plus a cease-and-desist order to a California company in connection with letters to Minnesotans about Medicare health insurance options that it said were misleading.
Commerce said Tuesday that a company called eHealthInsurance Services Inc. purchased the domain name "Medicare.com" and mailed more than 600,000 letters that used the website address and offered services for picking a new insurance plan.
Last year, about 300,000 people across the state were forced to shop for new coverage with the elimination of Medicare Cost health plans, which provided government benefits via private insurers.
"Respondent mailed misleading correspondence regarding the discontinuation of Medicare Cost plans to Minnesota consumers that reference the federal Medicare program on the envelope and in the correspondence," Commerce said in a consent order dated March 26.
The company "failed to include a sufficiently prominent statement that respondent is not in any manner connected with the government, Medicare, or Medicaid on every page referencing the federal Medicare or Medicaid programs, and that it is for insurance or intended to obtain insurance prospects," the order states.
In a written statement, a representatives for eHealthInsurance Services said that while the company disagrees with Commerce's position, "We're happy to make changes to satisfy its concerns." A company official signed the settlement agreement, which Commerce released on Tuesday.
The Medicare shopping season for 2019 coverage featured the elimination of Cost plans across 66 counties in Minnesota, forcing a choice between original Medicare and newer Medicare Advantage health plans. In October, Commerce issued a general warning to consumers not be fooled by deceptive advertising in the midst of the change.
Commerce said it was alerted to the mailings by several consumers including a woman in Bemidji who received letter addressed to her father, who died several years ago.
