Benefytt Technologies, Inc. would have to refund $100 million and stop misleading customers about coverage.
Benefytt Technologies, Inc., a marketer of health care plans, could have to refund $100 million to customers and face additional penalties under a complaint filed against the company by the Federal Trade Commission (FTC).
According to an FTC news release, the complaint alleges that Benefytt, two subsidiaries, and two of its top executives lied about the coverage the company’s plans provided. It also says that Benefytt used deceptive lead generation websites to lure customers and charged for add-on products without customers’ permission. The complaint names former Benefytt CEO Gavin Southwell and former vice president of sales Amy Brady.
Benefytt, based in Tampa, Florida, sells association memberships and other health care-related products, often through telemarketing companies and lead generators. Southwell was president and CEO of the company from 2016 to 2021, while Brady was vice president of sales for more than a decade before also leaving in 2021.
“Benefytt pocketed millions selling sham insurance to seniors and other consumers looking for health coverage,” Samuel Levine, JD, director of the FTC’s Bureau of Consumer Protection, said in the release. “The company is being ordered to pay $100 million, and we’re holding its executives accountable for this fraud.”
The complaint alleges that Benefytt and its partners used high-pressure sales tactics to deceive consumers into believing they were buying comprehensive health insurance plans and charging hundreds of dollars per month for products and services that left them unprotected in a medical catastrophe. It charges that Benefytt’s sales process harmed consumers by:
The release says that Benefytt and two of its subsidiaries have agreed to a proposed court order that would require them to:
Separate proposed court orders would prohibit Southwell and Brady from playing any role in selling or marketing any health care-related product or service.
The complaint and proposed final orders were filed in the U.S. District Court for the Middle District of Florida. They become enforceable after they are signed by a judge.
This article originally appeared on Medical Economics®.