State regulators slapped a cease and desist order yesterday on a San Diego company that sells discount health cards to people without health insurance.
First Choice Health Care, which operates out of an office on F Street, is violating California law by using “misleading” advertising to sell bogus health care service plans and operating without a license, according to the order issued by the California Department of Managed Health Care.
Yesterday's order against First Choice was the seventh issued by the department since it began cracking down on issuers of discount cards in 2004, and the second against a San Diego-based company. “We focus our enforcement actions on operations that are behaving in the most fraudulent and deceptive fashion,” said Cindy Ehnes, the department's director.
A First Choice Health Care representative could not be reached for comment yesterday.
A year ago, the department issued a similar order against Affordable Health Care Solutions Inc. The company shut down its San Diego operation and is no longer selling its products in California, Ehnes said.
She said companies like First Choice prey upon the more than 45 million Americans – 6 million in California – without health insurance. Using Spanish-language television, telemarketers and faxes, they sell the cards to people in poor, non-English-speaking areas.
“These people are so desperate to get health insurance for their families that they are very easily deceived by these ads,” Ehnes said.
The ads use terms like “no deductible” and “co-pay” to mislead people into thinking they are getting health insurance for an enrollment fee of $99 to $200 and monthly payments ranging from $40 to $100, Ehnes said.
When the consumers go to the doctor or hospital they find that their cards are either worthless or only get them a modest discount.
“They lose up to $1,500 on a scam that leaves them nothing but unpaid medical bills,” Ehnes said.
Consumers who think they have been defrauded by a company selling these cards can call the managed care department's help line at (888) 466-2219.
David Washburn: (619) 542-4582; david.washburn@uniontrib.com
