Business
United stops selling AARP limited-benefit insurance
■ The move follows a senator's criticisms about how the plans were marketed.
By Emily Berry — Posted May 28, 2009
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UnitedHealth Group and AARP have stopped sales of limited-benefit health plans that fell under criticism from U.S. Sen. Charles Grassley (R, Iowa) that the marketing was misleading.
About 44,000 people remain enrolled in the two products in question, the Essential Health Insurance Plan and Essential Plus Health Insurance Plan, originally sold as the Medical Advantage Plan, said United spokeswoman Marti Jones.
In a letter last year, Grassley told AARP leaders that the plans appeared to have been marketed improperly so that many enrollees believed they had health insurance, when in fact their benefits were designed to supplement comprehensive coverage, not replace it.
The problem came to Grassley's attention when a cancer patient enrolled in one of the plans went to M.D. Anderson Cancer Center in Houston thinking she was insured, only to discover she was responsible for thousands of dollars in treatment costs.
An investigation by Grassley's office suggested that AARP had marketed the products as an alternative to comprehensive coverage for people who could not afford better coverage.
In response to Grassley's inquiry, AARP in November 2008 asked United to stop marketing the plans, which it had been selling since 2003.
After an internal review, AARP and United announced April 22 that United would stop selling new EHIP or EPHIP policies.
Grassley welcomed the decision. But, he said, he remains concerned about the thousands who remain enrolled in the plans.
"This AARP plan was marketed in a way that wasn't straightforward about the plan's limited benefits. Whether or not it's on the market again, a lot of people already bought the policy, and I want to make sure they're given accurate information about the product they bought," Grassley said in a statement. He asked United and AARP to update him every six months on their progress.
In a news release, United promised to do "continuing education" with policyholders to ensure they understand their benefits.
United continues to sell AARP-branded Medicare Advantage and Medicare Part D plans as well as Medicare supplement plans.
