Watch Out For Medicare Scams

The March issue of Kiplinger’s features an article that will help you spot a medicare health scam before you (or your family) get taken for a ride. Watch out for sneaky insurance agents who ask for personal information or say they are from medicare and can reduce your premium:

When medicare introduced Part D coverage to pay for prescription drugs in 2006, it gave seniors a golden opportunity to save money — and crooks a golden opportunity to steal it.

The law offers Medicare beneficiaries a bewildering array of new health-insurance options. They can now choose from dozens of Part D prescription-drug plans to supplement Medicare, or they can opt out of traditional Medicare and enroll in a Medicare Advantage plan to get both medical and drug coverage from a private insurer. All of the new choices have resulted in “an immense amount of confusion,” says Micah Roderick, of the Illinois attorney general’s office.

Kiplinger’s says that corrupt agents have been known to sign people up without their knowledge or without properly explaining the limitations of the plans, and have even been caught posing as employees of medicare to sneak into buildings where seniors live. Some agents are not above stealing IDs, too. Huge commissions are paid to agents because the subsidies given to these programs are so lucrative for the private insurance companies. Naturally, this leads to all kinds of fraudulent behavior.

Barbara Jean Davis, 72, and her husband, Esty, 75, who live in Wilmington, N.C., had been covered by Medicare and retiree health benefits through Barbara’s former employer, DuPont. Their premiums and co-payments were reasonable, and without the coverage, Esty, who suffers from a number of ailments, would have had to pay hundreds of dollars a month for his medications.

About a year ago, Barbara was contacted by an insurance agent offering a Humana Medicare Advantage policy, subsidized by the government, with a zero-dollar premium. Suspicious but curious, Barbara invited the agent to her home. In the middle of his pitch, Barbara and Esty received a phone call and found out that one of their best friends had suffered a heart attack.

Distracted, Barbara tried to get rid of the salesman. But he persuaded her and Esty to sign papers that would give them a “head start” should they decide to buy the Humana policy later. “He made it sound like we hadn’t signed up for anything yet,” says Barbara.

But the next time she ordered Esty’s prescription, the pharmacist told her the DuPont insurance was no longer in effect. The agent “had canceled my insurance and signed me up with Humana without my say-so,” says Barbara.

It’s apparently quite easy to sign someone up for these plans without their consent. One expert interviewed in the piece had this to say: “If I had certain information about you, I could sign you up for Medicare Advantage and be paid a commission, and you wouldn’t know it until you filed a claim.”

If you think you’ve been the victim of a medicare scam or have information about one, you should report it to your State Health Insurance Assistance Program, says Kiplinger’s.

How to Spot a Health Scam


Edit Your Comment

  1. darkened says:

    Watch out for sneaky insurance agents who ask for personal information

    I feel you should reward this. To offer any type of insurance consultation an insurance agent needs a wide range of information. Selling insurance is a tough business so even adding unsolicited to this statement doesn’t clarify it as even cold calling is a source of leads for insurance.

    I think you should replace sneaky with unscrupulous.

  2. winstonthorne says:

    “Never invite a vampire into your house you silly boy; it renders you powerless.” – Max, from “The Lost Boys”

  3. SuperLisa says:

    As a healthcare consultant, I’ve seen cases where Medicare Advantage reps get kidney failure patients to opt out of traditional Medicare and into a MA plan, only to find out that dialysis isn’t a covered service. It shouldn’t be so easy to switch plans.

  4. JustinAche says:

    I used to sell insurance. I was even good at it without having to be a crook. But, there are creepy agents out there, and I worked with some, so now, I build starter homes and do graphic design on the side, a much more rewarding career

  5. Elvisisdead says:

    Anyone who feels that they were fraudulently signed up for a Medicaid plan they didn’t ask for should report it to the HHS Office of Inspector General.

    Contacting the HHS OIG Hotline

    Phone: 1-800-HHS-TIPS (1-800-447-8477)

    Fax: 1-800-223-8164


    TTY: 1-800-377-4950


    Office of Inspector General
    Department of Health and Human Services
    Attn: HOTLINE
    PO Box 23489
    Washington, DC 20026

    Each caller is encouraged to assist the OIG by providing information on how they can be contacted for additional information but CALLER MAY REMAIN ANONYMOUS.


    Type of complaint:

    * Medicare Part-A
    * Medicare Part-B
    * Child Support Enforcement
    * National Institute Of Health
    * Indian Health Service
    * Food and Drug Administration
    * Centers for Disease Control and Prevention
    * Substance Abuse and Mental Health Services Administration
    * Health Resources and Services Administration
    * Aid to Children and Families
    * All Other HHS agencies or related programs

    HHS department or program being affected by your allegation of fraud waste or abuse/mismanagement:

    * Administration for Children and Families (ACF)
    * Child Support Enforcement (CSE)
    * Centers for Medicare & Medicaid Services (CMS)
    * Food and Drug Administration (FDA)
    * National Institutes of Health (NIH)
    * Office of Disease Control and Prevention (CDC)
    * Indian Health Service (IHS)
    * Office of Inspector General (OIG)
    * Office of the Secretary (OS)
    * Health Resources and Services Administration (HRSA)
    * Substance Abuse and Mental Health Administration (SAMSHA)
    * Administration on Aging (AOA)
    * Agency for Health Care Policy and Research
    * Other (please specify)

    Please provide the following, if you would like your referral to be submitted anonymously please indicate in your correspondence or phone call:

    * Your Name
    * Your Street Address
    * Your City/County
    * Your State
    * Your Zip Code
    * Your email Address

    Subject/Person/Business/Department that allegation is against:

    * Name of Subject
    * Title of Subject (if applicable)
    * Subject’s Street Address
    * Subject’s City/County
    * Subject’s State
    * Subject’s Zip Code

    Please provide a brief summary relating to your allegation.

  6. shadow735 says:

    I am taking my Beagle to the vet today, but he is just getting his nails clipped.

  7. memphis9 says:

    When I get old, please tatoo these 3 reminders onto my document-signing hand.

    (1) – if you must decide NOW, tell salesdroid to go fuck him/her/itself.

    (2) – if s/he absolutely has to come and pitch to you in your *home*, see #1.

    (3) – if s/he turns up at your door or cold calls phone or email, see #1. (The one you pick is rarely as bad as the one who picks YOU.)

    Oh, I’d really like to think I will always be smarter than that, short of outright dementia, but have dealt with too many older relations with jaw dropping complaints like “I was confused and they were hurrying me, so I just signed”. AND I’m talking about ppl who were obviously sharp and survival-oriented enough to do quite well pre-retirement, can still tell you what day it is, who their state representatives are, and how many food exchange points are in their salad dressing, so WTF?

  8. polyeaster says:

    I work for Medicare, very familiar with these issues. I’m not sure that SHIP is really able to do anything about that type of issue, but I know that if a person in that type of situation calls 1-800-MEDICARE we will do our best to correct the situation, give them appropriate referrals to governing agencies if they request.