Federal Trade Commission staff sent warning letters to 25 companies on Thursday regarding deceptive marketing practices for healthcare plans. The letters put the recipient companies on notice about deceptive or unfair claims that likely violate laws enforced by the agency.

The correspondence targets firms that market or advertise Affordable Care Act Marketplace health insurance, limited indemnity plans, and medical discount programs. Prohibited claims cited in the letters include misrepresenting the benefits, limitations or costs of a healthcare plan, as well as misrepresenting that a plan is major or comprehensive medical health insurance when it is not. The letters also cite falsely claiming that consumers who enroll will receive free offers, cash rewards, rebates or other incentives.

"Today’s letters remind companies that open enrollment is not an invitation to misrepresent what their plans actually cover," said Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection. "Americans experiencing rising healthcare costs should not also have to worry about whether a healthcare plan or program is what it claims to be."

The warning letters do not allege any wrongdoing by any of the current recipients. Instead, they encourage the companies to conduct a thorough review of their advertisements to ensure compliance with applicable laws and rules. The FTC expects to send additional warning letters on a rolling basis.

Why It Matters

The Federal Trade Commission is a United States federal government agency tasked with enforcing consumer protection laws.