Scammers prey on health care confusion

Victoria Colliver / San Francisco Chronicle /

Published Aug 22, 2013 at 05:00AM

As California prepares to roll out its effort to market the Patient Protection and Affordable Care Act, criminals have increasingly been working schemes to take advantage of consumers who may not be fully informed about the complex health reform law that will require them to buy insurance if they don’t have it.

The scams include high-pressure emails, phone calls from people masquerading as representatives of the federal government or a visit from a seemingly official enroller trying to persuade people to buy a policy, sign up for a bogus medical card or give out their personal information.

“Obamacare scams are popping up all over the country. They’ve been identified in at least half of the states, and possibly more,” said Jim Quiggle, spokesman for the Coalition Against Insurance Fraud, a Washington, D.C., group that works with consumers, insurance companies and government agencies to combat fraud.

The perpetrators have a wide range of tactics and could come from anywhere, he said. “Nobody knows whether the scams are carefully orchestrated by an organized criminal enterprise or whether this is simply buckshot phone calls by individual entrepreneurs who think they can make a quick dollar off of the impending launch of health reform,” Quiggle said.

Either way, consumer experts say the ploys are designed to take advantage of a large segment of the population that may not yet understand the details of the most comprehensive overhaul of the nation’s health system in decades.

In one mass email scheme that has been circulating in recent weeks, recipients are told that failure to obtain health insurance under the Affordable Care Act could result in incarceration.

“Are you breaking the law?” reads the e-mail from a “Health Insurance Expert.” “With the President’s health care mandate now passed into law, you could face prison time if you do not get healthcare coverage immediately. We can help you avoid penalties and find an affordable plan.”

The threatening come-on is false because the health care law will not imprison anyone for not getting coverage. Additionally, signups for the new health program will not begin until Oct. 1, so no “immediate” action can be taken.

In another reported scheme, scammers have been trying to swindle an “enrollment fee” from consumers to sign up for coverage under the law, even though no fee is required to participate.

Scams started as soon as the law passed in 2010, but they are becoming more widespread as the law gets close to being implemented, Quiggle said. “Now there’s another wave during the run-up to the launch of whole system,” he said.

“Your best defense against these cons is simply close the door or hang up the phone,” Quiggle said. “Don’t let these crooks engage you in conversation. They are very smooth and well-trained, and they might try to sweet talk you into giving up your sensitive information.

“Confusion is a scammer’s best friend, and these criminals are exploiting the confusion and people’s lack of understanding of health reform and what it means to their lives.”

A poll by the Kaiser Family Foundation this spring showed 42 percent of people surveyed didn’t know the health law is actually the law of the land. That includes the 12 percent who believe the law has been repealed by Congress and 7 percent who believe it has been overturned by the Supreme Court.

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