Scammers often follow the news headlines, crafting their schemes around real events to make them seem more plausible.
For example, after Congress passed financial "bailout" bills in 2009, scammers tried to convince ordinary Americans they too could qualify for money from the government. People who had not followed the news closely were easy prey.
Now that Congress has passed health care reform, consumers are being warn about scammers trying to convince Americans the new law requires them to buy health insurance immediately. Actually, the law does require all Americans to be insured, but the mandate does not begin until 2014.
"It comes as little surprise that the federal government's requirement that individuals buy health insurance starting in 2014 would embolden scammers to defraud people into buying it needlessly now," said Indiana Attorney General Greg Zoeller. "The Indiana Attorney General's Office has not yet received complaints of salespeople pushing dubious or phony health insurance policies onto Hoosiers. But the situation is ripe for fraudsters to sow misunderstandings among the public and then sell them worthless financial products."
Last week U.S. Department of Health and Human Services Secretary Kathleen Sebelius sent a letter to state attorneys general nationwide, warning that HHS has received reports of scammers going door-to-door selling phony insurance policies and urging people to obtain coverage during a non-existent "limited enrollment" period they falsely claim the new law created. Sebelius' letter urges state authorities to investigate any such scams if they surface.
Zoeller said the Attorney General's Consumer Protection Division stands ready to investigate scams and assist anyone who has received such unsolicited sales offers. Beyond violating Indiana's own state insurance regulations, phony health insurance offers could violate Indiana's law in other ways, especially if they call consumers on the Do Not Call list, or employ robo-callers.
Too early to buy 'qualifying' policies
The new federal healthcare law passed in March contains a mandate that individuals who don't already have health coverage must purchase a commercial insurance product from a private company starting in 2014. That is when states will be required to start operating insurance exchanges where insurance companies will offer health policies that uninsured individuals can purchase.
Also, not every health insurance plan will qualify under the new legislation. A decision on which policies will and won't qualify will be made between now and 2014, but there is no way a company could sell policies now and guarantee they would meet the government mandate.
"That mandate is three years away, and while many details still are unknown, I would be extremely surprised if door-to-door salespeople would be enlisted to sell plans under this scheme," said Deputy Attorney General Abigail Kuzma, director of the Consumer Protection Division. "People who want private insurance coverage now and don't qualify for a public plan should consult with established, licensed insurance agents and obtain multiple quotes before buying any policy, even short-term."
To sell insurance policies in most states, a company must be licensed with that state.