FTC cracks down on companies selling phony health insurance

The firms sold consumers a discount card but it offered no health insurance benefits. Also in the news, a government researcher says federal officials need to monitor billing errors and overpayments to Medicare Advantage plans.

CBS News: FTC Cracks Down On A Health Insurance Scam
Several marketing companies accused of leading people to believe they were buying health insurance when the companies were offering only a supposed discount card issued by a made-up trade association were banned from selling health care-related products, the Federal Trade Commission said on Tuesday (Lipka, 10/14).

The Center For Public Integrity: A Call For More Scrutiny Of Private Medicare Advantage Plans 
Federal officials need to do a better job ferreting out billing errors and overpayments to Medicare Advantage plans -; mistakes which are estimated to cost taxpayers billions of dollars every year, a top government researcher says. Medicare pays the privately-run Advantage health insurance plans, which cover more than 15 million elderly and disabled Americans, using a complex formula called a "risk score." Sicker patients command higher rates than healthier ones, but the industry has been criticized for allegedly overstating how sick some patients are to boost Medicare revenue, a practice known as "upcoding" (Schulte, 10/15).