Attorney General Bonta Announces $2.1 Million Settlement Against Companies Over Sham Health Insurance Plans
"ASH and SHA promised peace of mind and security to Californians looking for health insurance," said Attorney General Bonta. "What these companies didn't mention was that their plans had shoddy coverage that could leave members holding the bag on medical bills in case of a health crisis. Our settlement today holds ASH and SHA accountable, and should serve as a warning to other sham insurers. I urge all Californians looking for affordable healthcare to beware of sham health plans, do their research, and most importantly -- consider applying for reliable, inexpensive coverage through Covered California."
HCSMs began as a way for people with common ethical or religious beliefs to pool together their money and share the cost of medical care. However, HCSMs are not required to provide the crucial and lifesaving aspects of standard health insurance plans, because they are exempt from Affordable Care Act (ACA) mandates to cover pre-existing conditions, preventative care, reproductive care, and mental healthcare. After the ACA was passed, some companies began to capitalize on the ACA exemptions granted to HCSMs by entering into agreements with churches, then presenting themselves as HCSMs and marketing their plans as a cheaper alternative to ACA-compliant health insurance.
In 2021, after receiving multiple complaints from consumers alleging that their HCSM plans refused to cover treatments and pay their medical bills, Attorney General Bonta issued a consumer alert, warning Californians about illegitimate HCSMs.
As part of its investigation into ASH and SHA, DOJ found evidence that the companies falsely advertised ASH as a legitimate HCSM even though it did not qualify as one. Further, ASH and SHA allegedly violated
Today's settlement agreement requires ASH and SHA to pay more than
* A requirement to cease all marketing, sales, and operations in
* A prohibition on its executives from holding leadership or ownership positions in an organization that purports to be an HCSM in
A copy of the complaint can be found here (https://oag.ca.gov/system/files/attachments/press-docs/ASH-SHA%20Complaint%20%281%29_0.pdf). A copy of the stipulated judgment, which is subject to court approval, can be found here (https://oag.ca.gov/system/files/attachments/press-docs/Stipulation%20for%20Entry%20of%20Final%20Judgment%20%28with%20Ex.%20A%29.pdf).
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Original text here: https://oag.ca.gov/news/press-releases/attorney-general-bonta-announces-21-million-settlement-against-companies-over
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Attorney General Bonta Announces $2.1 Million Settlement Against Companies Over Sham Health Insurance Plans
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