Dive Brief:

• The Federal Trade Commission said Tuesday it is sending warning letters to 21 companies that market or generate leads for healthcare plans, according to a release.  
• Noting that it is currently open enrollment season for healthcare plans, the agency said it is putting on notice companies that provide marketing or advertising, including lead generation, related to Affordable Care Act Marketplace health insurance and healthcare-related products such as limited benefit plans and medical discount programs. 
• “It is critical for consumers’ health and financial well-being that marketers of health plans be honest about the plans they and their partners are offering,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a comment contained in the release. 

Dive Insight:

The warning comes less than a week after UnitedHealthcare CEO Brian Thompson was fatally shot in midtown Manhattan in what appeared to be a targeted attack. His death sparked an outpouring of grief, raised questions about executive security and unleashed expressions of frustration and anger on social media about health insurers and claim denials.  

It also comes as CFOs who have been finishing up 2025 budgets are once again making adjustments for rising healthcare costs. The price tag for U.S. health care benefits will likely rise 10.2% next year compared with a 9.3% gain seen this year, driven by inflation, shortages of health care workers and the demand from providers for higher prices on the renewal of multi-year contracts, CFO Dive reported.     

The FTC did not name the companies that were put on notice and did not immediately respond to requests for comment. A template of the letter on the FTC’s website detailed that Section 5(a) of the FTC Act, 15 U.S.C. § 45(a) prohibits such practices as misrepresenting the benefits included in healthcare-related products including any insurance, misrepresenting the costs of healthcare-related products, and misrepresenting that a healthcare-related product is comprehensive. 

The letter also noted prior enforcement actions it has undertaken to protect consumers from related practices. They include a $195 million judgment against Simple Health Plans, a lead generation and telemarketing operation that sold medical discount and limited benefit programs falsely marketed as comprehensive health insurance, and an $8.7 million judgement against Partners In Healthcare Association found to have falsely marketed medical discount cards as health insurance. 

Sending warning letters is a practice by which the FTC seeks to let companies know that their “conduct is likely unlawful and that they can face serious legal consequences, such as a federal lawsuit, if they do not immediately stop,” the FTC said. However, the letter template sent to marketers of health insurance and health-care related products states that the FTC is not “singling out your company or suggesting that you have engaged in illegal conduct,” but urges the company to review its marketing and advertising practices.