ACA Plans Are Being Switched Without Enrollees’ OK

Lambert here: Thanks, Obama!

By Julie Appleby, Senior Correspondent at KFF Health News, reports on the health law’s implementation, health care treatments and costs, trends in health insurance, and policy affecting hospitals and other medical providers. Originally published at KFF Health News.

Some consumers covered by Affordable Care Act insurance plans are being switched from one plan to another without their express permission, potentially leaving them unable to see their doctors or fill prescriptions. Some face large IRS bills for back taxes.

Unauthorized enrollment or plan-switching is emerging as a serious challenge for the ACA, also known as Obamacare. Brokers say the ease with which rogue agents can get into policyholder accounts in the 32 states served by the federal marketplace plays a major role in the problem, according to an investigation by KFF Health News.

Indeed, armed with only a person’s name, date of birth, and state, a licensed agent can access a policyholder’s coverage through the federal exchange or its direct enrollment platforms. It’s harder to do through state ACA markets, because they often require additional information.

It’s rampant. It’s horrible,” said Ronnell Nolan, president of Health Agents for America, a nonprofit trade association representing independent insurance brokers.

The growing outcry from agents who have had their clients switched by rivals — which can steer monthly commissions to the new agent — casts a shadow on what otherwise has been a record year for ACA enrollment. More than 21 million people signed up for 2024 coverage.

Federal regulators are aware of the increase in unauthorized switching and say they have taken steps to combat it. It’s unclear, though, if these efforts will be enough.

On Feb. 26, the Centers for Medicare & Medicaid Services sent a “plan switch update” to industry representatives acknowledging “a large number” of 2024 cases and outlining some of its technical efforts to resolve problems when complaints are lodged.

“CMS is committed to protecting consumers in the marketplace,” said Jeff Wu, deputy director for policy for CMS’ Center for Consumer Information & Insurance Oversight, in a written statement to KFF Health News.

His office refused to provide details on how many complaints it has seen or the number of agents it has sanctioned but his statement said when action is taken, CMS reports it to state insurance departments, whose authority includes revoking licenses.

Wu did not answer specific questions about whether two-factor authentication or other safeguards would be added to the federal website, though he wrote that CMS is “actively considering further regulatory and technological solutions to some of these problems.”

In June, new rules kicked in that require brokers to get policyholders’ written or recorded verbal consent before making changes, although brokers said they are rarely asked for those documents.

Finding Out the Hard Way

Some unwitting enrollees, like Michael Debriae, a restaurant server who lives in Charlotte, North Carolina, not only end up in plans they didn’t choose but also bear a tax burden.

That happens when enrollees are signed up for coverage that includes premium tax credits paid by the government to insurers, even though the enrollee is ineligible, either because their income was misstated by the broker making the switch, or they had job-based insurance, like Debriae.

Unbeknownst to him, an agent in Florida with whom he had never spoken enrolled him in an ACA plan in March 2023. It was two months after he canceled his Obamacare coverage because he was able to get health insurance through his job. In June, he discovered he had a new ACA policy when his longtime pharmacy said it could not fill a 90-day prescription, which it had done with no problem in the past.

“That’s when I realized something horribly wrong had happened,” said Debriae.

Debriae got contact information for the Florida broker, but when he called, the office said the agent no longer worked there. He filed a complaint with the federal marketplace and canceled the plan. But he still owed the IRS part of the $2,445 in premium tax credits paid to the insurer from March until July on his behalf.

To be sure, some switches could be legitimate, when enrollees choose a different broker or plan. And agents do have a vested interest in raising the issue. They lose out on commissions when their clients are switched by other agents. But brokers whose clients have been switched through unauthorized transactions say the real losers are consumers.

“People literally losing their plans is fraud, absolute fraud, not a squabble between agents,” said Leslie Shields, an insurance broker in Fort Worth, Texas.

Patients’ new plans might not include their doctors or might come with higher deductibles than their former coverage. Because the agent on the policy is generally switched, too, enrollees don’t know whom to call for help.

“You have surgeries that can’t happen, providers that can’t be seen, or have been changed,” said Shields. It’s happened in the past, but now it’s literally the worst I’ve seen.”

Ease of access to policyholders’ accounts on the federal marketplace is a double-edged sword, agents say: It aids enrollment, but also makes it easier to switch plans without consent.

“Those bad eggs now have access to all this private information about an individual,” including household income, Social Security numbers, and dependents, said Joshua Brooker, a broker who follows the issue closely as chair of a marketplace committee for the National Association of Benefits and Insurance Professionals, a trade group.

Complaints gained momentum during the most recent open enrollment period, agents say. One worker in a government office that helps oversee operations of the federal exchange told KFF Health News of personally handling more than 1,200 complaints about unauthorized switches or enrollments in the past three months, averaging about 20 a day. About 30 co-workers are working on similar complaints. It can take multiple days to resolve the most urgent cases, and two to four weeks for those deemed less urgent, the worker said.

Florida, Georgia, and Texas appear to be plan-switching hotbeds, agents say. Florida and Texas officials referred questions to federal regulators. Bryce Rawson, press secretary for the Georgia Department of Insurance, says the state saw no switching complaints last year and has about 30 so far in 2024, a small number but one it is taking seriously: “It’s still an active and ongoing investigation.”

By contrast, states that run their own marketplaces — there are 18 and the District of Columbia that do — have been more successful in thwarting such efforts because they require more information before a policy can be accessed, Brooker said.

In Colorado, for example, customers create accounts on the state’s online market and can choose which brokers have access. Pennsylvania has a similar setup. California sends a one-time password to the consumer, who then gives it to the agent before any changes can be made.

Adding such safeguards to could slow the enrollment process. Federal regulators are “trying to thread a needle between making sure people can get access to coverage and also providing enough of a barrier to capture anyone who is coming in and acting nefariously,” said Brooker.

How Does It Happen?

Many people have no idea how they were targeted, agents say.

Jonathan Kanfer, a West Palm Beach, Florida, agent, suspects names and lists of potential clients are being circulated to agents willing to bend the rules. He said his agency has lost 700 clients to switching.

The agents doing the switching “don’t care about the people,” Kanfer said, only the money, which can amount to a monthly commission of roughly $20 to $25 per enrollee.

“Two weeks ago, someone telemarketed me, gave me a number to call to get leads for Obamacare,” said Kanfer, who turned down the offer. The person told him: “You don’t even have to speak with the people.”

Online or social media advertising is a way some outfits troll for prospects, who then end up on lists sold to brokers or are contacted directly by agents. Such lists are not illegal. The problem is the ads are often vague, and consumers responding may not realize the ads are about health insurance or might result in their policies being changed. Such ads promise free “subsidies” worth up to $6,400, often implying the money can help with groceries, rent, or gas. Some do mention “zero-dollar” health insurance.

Yet agents say the ads are misleading because the “subsidies” are actually the premium tax credits many people who enroll in ACA plans are eligible for, based on their income.

“They’re portraying it like it’s money going into your pocket,” said Lauren Jenkins, who runs an insurance brokerage in Coweta, Oklahoma, and has seen about 50 switching cases in recent months. But the money goes to insurers to offset the price of the new plan — which the consumer may not have wanted.

Ambetter Health — a division of Centene that offers ACA plans in more than two dozen states — sent email alerts to brokers in September and November. One noted a jump in complaints “stemming from misleading advertisements.” Another warned of “termination actions” against bad actors and directed agents not to collect consumer information or consent via “online forms or social media ads.”

In response to the switching, Ambetter also instituted a “lock” on policies starting at midnight on Dec. 31, meaning the agent on the policy by that deadline would remain on it for all of 2024, according to an email the insurer sent to brokers.

Results are mixed.

Adam Bercowicz, a licensed independent broker in Fort Lauderdale, Florida, said he and his staff worked New Year’s Eve, monitoring their client lists and watching as some were switched before their eyes.

“If I saw one of my clients was stolen from me at, let’s say, 11:57 p.m., I put myself back on,” said Bercowicz, who estimates he’s had 300 to 400 policies overtaken by other agents not connected to his staff in recent months. “And by 11:58 — a minute later — they were already switched back.”

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. mrsyk

    His office refused to provide details on how many complaints it has seen or the number of agents it has sanctioned…. Many complaints/zero agents sanctioned perhaps? “Fighting for” maybe?

    1. Objective Ace

      Similiarly, “Federal regulators are aware of the increase in unauthorized switching and say they have taken steps to combat it.”

      What steps? Throw some people in jail for a very long time and I imagine the issue goes away quickly, even if they dont improve the secutiry of their website

      1. mrsyk

        I’m guessing those “steps” are recommendations to congress, where they are duly ignored.

    2. tegnost

      “CMS is committed to protecting consumers in the marketplace,”

      My thoughts exactly when I saw this line.
      They need to change “committed to” to “fighting for” so everyone will know there’s no hope.

  2. The Rev Kev

    Some agents lose out on commissions when their clients are switched by other agents. Maybe the former agents should, using the same techniques as those slimeball agents, go in and switch the healthcare plans of those agents to the most expensive available. But signing a person up to another plan without their knowledge is tantamount to switching contracts on them. And in my books that is fraud which in the US just happens to be a felony.

    1. Whiteylockmandoubled

      Maybe all the agents should just go do something actually productive. Health insurance sales is pure make-work, tens of thousands of people running around doing something that should routinely happen at birth or upon entry to the country and need only happen once in a person’s life.

      Sure, track down the creeps who are doing this, but the existence of the “good” agents is a far bigger problem than adding a layer of criminality to the existing, almost indescribably corrupt “system.” Brokerage fees are graft.

      And by the way, the good and bad agents are ferociously and fraternally united in opposition to fully-funded, improved Medicare for All or any other decent universal coverage system, through their trade associations’ spending, DC lobbying and, must importantly, their own grassroots in-district lobbying. Ask any Congresscritter.

      I know some nice people who do this work. Collectively, they’re mass killers and thieves.

      1. Jim

        The growing outcry from agents who have had their clients switched by rivals — which can steer monthly commissions to the new agent

        I’m shocked that there’s a monthly commission. Not even real estate agents are bold enough to do more skimming than a one-time fee.

  3. timbers

    “He filed a complaint with the federal marketplace and canceled the plan. But he still owed the IRS part of the $2,445 in premium tax credits paid to the insurer from March until July on his behalf.”

    The IRS is saying in plain sight that it paid money to Sally, and that is why Jane owes the IRS the taxes on Sally’s income.

    Does that mean if I buy a car or any product that companies get tax subsidies for from the government and I return the product, I should get a bill from the IRS for portion of the government subsidy that went to the corporation for that return?

    Seems to me, those awesome Supremes should step in and tell IRS it “lacks standing” to access on taxes on folks who didn’t the get the government subsidy. But then, lacking standing is only used when the Supremes want to strip individuals and the public of their constitutional rights to so as to protect corporations, business interests, and freedom suppressing governments. Because a majority of The Supremes know U.S. Citizens “lack standing” in any constitutional right that affects them and any public or not public policy of the government that affects them.

    1. mrsyk

      Indeed. The wrongness is pretty straight forward. Maybe Lina Kahn can fix it, but that would involve the supremes. It would be surprising if they decided against the FIRE sector.

    2. Objective Ace

      My understanding is you cant return your insurance. Your locked in for the full year. Given that, the victim still receives the benefit of the subsidy

      While I’m always a fan of a simpler tax code, the proper venue for fighting this is fraud and penalty fees used to pay back the victims

      1. mrsyk

        This would differ from other kinds of insurance, say auto, home, which refund you the exact amount you over paid if you terminate your policy. This in Vermont, may vary from state to state.

  4. Alice X

    Ah, sweet NeoLiberalism, I remember thee well…

    And some among us thought they were no longer serfs.

  5. playon

    Wow, these slimeballs are willing to do this for $20 to $25 per enrollee? Things are tough out there I guess. The lawlessness is creeping down the food chain.

    1. JBird4049

      People are already being sued for debts that they either never had or are so old that legally are unenforceable. Then there was the robosigning of often illegal foreclosures during the Great Recession. Civil asset forfeitures by the police are another massive problem.

      It is just corruption everywhere.

  6. JonnyJames

    “Don’t take it personal, it’s strictly business”

    Despite a clear majority of US dwellers who, for decades, want a single-payer style, universal health care system (like most of the world), our institutionally corrupt Congress (and SCOTUS) is legally bribed by the Health Extortion Complex. (Insurance, BigPharma, AMA etc) to maintain the current extortion system which represents anywhere from 17-19% of GDP, with some of the lowest health outcome indicators in the world.

    Keeping people in ill-health is good for their business model. BigAg, BigFood Inc. are also part of the racket. The US spends almost double what the rest of OECD countries spend for “health care” yet has some of the most dismal health outcomes. In most cases, health indicators are the WORST in the OECD, and worse than many developing countries.

    Yeah, thanks Obama, Pelosi and the entire duopoly (including the R faction, of course) “single payer is off the table”, (Public opinion and public welfare don’t matter, the oligarchy dictates policy).

    We can’t expect to ameliorate this unless some form of democratic accountability can be brought about. Instead of “voting” for an amoral, genocidal, geriatric sociopath-freak, maybe we should have a nationwide protest to demand meaningful choices. None of the current candidates for Puppet Emperor have any plan to fix the mess, and it is only getting worse. (Jill Stein or any other candidate not in the D/R duopoly, has almost zero chance of winning the BigMoney Media game)

    That’s how “freedom and democracy” goes in the “indispensable, exceptional nation”

    1. Hepativore

      We have already had nationwide protests over many things, such as the genocide going on in Gaza that Biden and the rest of the US government is funding, and our leadership refuses to listen, there have been outcries over the obvious vote-rigging of the primaries by the DNC and they have basically flipped voters the bird, and the largest anti-war protests in the history of the US did nothing to dissuade W. Bush from invading Iraq.

      This basically shows that the presidency is a monarchy under a different name that is chosen by a largely-ceremonial “election” and Congress is basically a house of nobles. Our political leaders do not care what the populace thinks or how much it protests as they will suffer no real consequences from thumbing their noses at their subjects. You might get a few insurrection attempts here and there by a few groups of people that have gotten fed up with how bad things are, but the MIC and surveillance state would make short work of anything like that in the US before it could ever get anywhere.

      1. JonnyJames

        Sad but true. I guess the only thing left is to just leave the country. When the western empire and city of Rome was declining and decaying, the smart thing to do was move to Constantinople or somewhere in the prosperous East. Many did, and the population of Rome declined rapidly.

  7. CA

    Would this be a possible result of an insurance switch? I do not understand whether this article relates to the post, though I read both carefully:

    April 7, 2024

    Insurers Reap Hidden Fees by Slashing Payments. You May Get the Bill.
    A little-known data firm helps health insurers make more when less of an out-of-network claim gets paid. Patients can be on the hook for the difference.
    By Chris Hamby

    Weeks after undergoing heart surgery, Gail Lawson found herself back in an operating room. Her incision wasn’t healing, and an infection was spreading.

    At a hospital in Ridgewood, N.J., Dr. Sidney Rabinowitz performed a complex, hours long procedure to repair tissue and close the wound. While recuperating, Ms. Lawson phoned the doctor’s office in a panic. He returned the call himself and squeezed her in for an appointment the next day.

    “He was just so good with me, so patient, so kind,” she said.

    But the doctor was not in her insurance plan’s network of providers, leaving his bill open to negotiation by her insurer. Once back on her feet, Ms. Lawson received a letter from the insurer, UnitedHealthcare, advising that Dr. Rabinowitz would be paid $5,449.27 — a small fraction of what he had billed the insurance company. That left Ms. Lawson with a bill of more than $100,000.

    “I’m thinking to myself, ‘But this is why I had insurance,’” said Ms. Lawson, who is fighting UnitedHealthcare over the balance…

  8. none

    With phone companies this was called slamming. I haven’t heard about it in a while. Has it been fixed somehow?

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