On Tuesday, the Department of Managed Health Care took steps to bar a Folsom insurance agent from selling Medicare Advantage plans after she allegedly defrauded at least 12 capital-area seniors, who then incurred thousands of dollars in unexpected medical bills.
The agent, identified by state officials as Nadia King, allegedly canceled the existing Medicare coverage of her clients and enrolled them in Medicare Advantage plans run by private insurers. King could not be reached for comment. She has until the end of the month to appeal the decision to revoke her privilege to sell Medicare Advantage products.
She is one of two dozen agents across the state getting legal scrutiny because of what officials said was deceptive marketing aimed at seniors. Pauline Eckels, 98, of Citrus Heights was identified by the state as one of King's alleged victims.
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Eckels, who has been on Medicare since 1977, recalls a day sometime before Christmas when King knocked on her door. She said they spent about a half hour talking, and that she provided personal information to King during the conversation. "I already had insurance, but she said she was going to try and help me get cheaper insurance."
Eckels said she never authorized King to cancel her current plan. But to her surprise a week later, her pharmacist said her prescription coverage was no longer in effect. She said she doesn't remember much of what was said during her talk with King. "Put yourself in the shoes of a 98-year-old," she said, adding that "It messed me up good."
Federal health officials have reached out to states to stamp out fraud and deception in the Medicare program. "Every time there is a change in one of our programs, it always creates an opportunity to take advantage of someone who doesn't understand the change," said David Sayen, administrator for Medicare's San Francisco regional office.
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As the national debate over health care legislation intensified, state and federal officials said they began seeing a marked increase in complaints from consumers about possible scams and insurance agents seeking to persuade seniors to change their Medicare coverage.
Confusion over changes to the country's health care system "opened up a floodgate of deceptive sales practices and fraudulent products," said Cindy Ehnes, director of the Department of Managed Health Care.
"Deceptive marketing is nothing new," she said. "Because of the recent rhetoric around health insurance, the lack of detail -- it has created a real opportunity for less-than-scrupulous operators who are out there."
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State officials say scores of other seniors may have fallen victim to scams and unethical marketing ploys.
People who prey on vulnerable populations do so because they know their victims are less likely to contact authorities, said Michael McClelland, the chief of enforcement for the California Department of Managed Health Care.
The financial rewards for unscrupulous agents can quickly add up. Agents who enroll new customers in a Medicare Advantage plan typically receive commissions of $350 to $500, McClelland said.
In a traditional Medicare policy, the federal government acts as an enrollee's insurance company. Under Medicare Advantage, among the most powerful programs within Medicare, the federal government pays premiums to a private insurer to administer benefits.
According to the state's complaint, King enrolled her elderly clients into Medicare Advantage plans without their consent. She allegedly made misrepresentations while marketing the plans.
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