Health Costs Lure Some Oregonians Into Insurance Scam


Health insurance costs are tempting consumers to buy phony low-cost coverage — plans that collect premiums but don’t pay claims. Regulators said the scams are leaving hundreds of Oregonians stuck with unpaid bills, reports the Oregonian. Unlicensed health insurers — including between five and 14 in Oregon — covering more than 200,000 people nationwide between 2000 and 2002 resulted in at least $252 million in unpaid claims, according to a General Accounting Office report issued earlier this year. Since then, health care fraud has increased by at least 3 percent a year, according to the National Healthcare Anti-Fraud Association.

Offers abound by phony firms touting low-cost plans that may appear legitimate. The benefit manager for one firm said he receives scores of faxed and e-mailed fliers promising “Health Care for the Entire Family” for monthly premiums of as little as $54 to $99 a person. The state has received more than 40 consumer complaints about fake health insurance in the past two years. In July, state regulators cited Indiana-based My Smart Benefits Inc. for failing to register. The firm went out of business in October after allegedly duping more than 300 Oregon businesses into buying dental coverage that never paid claims.


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