Florida’s homeless have been duped into Affordable Care Act plans they can’t afford

Florida's homeless have been duped into Affordable Care Act plans they can't afford

MIAMI Mary Zhelyazkova was surprised when pharmacists at Florida’s largest safety-net hospital said they couldn’t fill her prescription.

Zhelyazkova, 40, lived in a homeless shelter and needed Suboxone, a drug to manage opioid withdrawal symptoms.

He said he received Suboxone for free at the Jackson Memorial Hospital pharmacy through the Ryan White HIV/AIDS Program, which provides low- or no-cost medical care to people with HIV.

But in late 2021, she said, a stranger approached her on the street and offered her $5 to sign up for a free health insurance plan with Florida Blue. The person directed her to use a false address and falsify her income so she could be considered eligible for coverage, she said.

When the plan went into effect the following year, Zhelyazkova learned of the drawbacks.

Taking out private insurance disqualified her from Ryan White coverage. And Florida Blues’ network of providers didn’t include the hospital pharmacy; he was supposed to go to Walgreens which would have required transportation. He would also have to find a $20 copay, which he couldn’t afford.

I went into withdrawal. It was horrific, Zhelyazkova said, which she added was without medication for days, until a nonprofit needle exchange program paid for the drug.

Zhelyazkova is one of potentially hundreds of homeless people in Florida who have been approached by agents and brokers seeking commissions, enrolling them in zero-premium health plans on the Affordable Care Act marketplace, according to state insurance regulators, i doctors and counselors membership.

The presumption is that rogue agents and brokers are enlisting homeless people to earn a sales commission and are committing fraud by lying about income and home addresses of subscribers.

And although the federal government pays the monthly premium for low-income qualified consumers under an Affordable Care Act plan, policies often provide for upfront payments, deductibles and other out-of-pocket costs that are unaffordable for people earning little or no income.

Amid increased reports, state and federal regulators are investigating cases of agents and brokers providing fraudulent information on Affordable Care Act coverage applications.

The federal agency that oversees the Affordable Care Act market said that for the fiscal year ended September 30, 2022, the agency received more than 25,000 complaints from people who said they were signed up for policies without their consent or that incorrect information was submitted at the request of an agent or broker. The Centers for Medicare & Medicaid Services also said it performed more than 700 license audits to identify potentially problematic brokers during the same period.

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Opportunistic recruitment of homeless people into Affordable Care Act plans is most likely in states like Florida, one of 10 that have refused to extend Medicaid eligibility to nearly all low-income adults. In a 2015 case, a North Carolina agent enrolled hundreds of homeless people for Affordable Care Act coverage. That state adopted Medicaid expansion in March, though the change hasn’t yet been implemented.

In a state of expansion, most single adults in poverty would qualify for Medicaid. In non-growth states, including Florida, consumers generally must earn at least 100 percent of the federal poverty level to qualify for health care tax credits, which reduce monthly premiums and out-of-pocket expenses. In 2023, that would equate to $14,580 for a single person and $24,860 for a family of three. But having no income this year doesn’t preclude a consumer from predicting that he or she will earn enough next year to qualify for tax credits. Consumers are not required to document their income on a market application if government data shows their income was insufficient in previous years. On the surface, it might appear that the uninsured homeless are gaining coverage, said Sabrina Corlette, a health insurance policy expert at Georgetown University. It’s not such a bad thing, she said.

But that doesn’t make it a victimless crime. The federal government ends up paying subsidies to health insurers to cover people who don’t qualify for the plans. Meanwhile, the homeless are losing eligibility for more suitable programs, such as Hospital Charity Assistance and Ryan White. This is a serious problem, Corlette said.

Physicians who work with the homeless also say interruptions in care put these patients at risk of relapse to drug use, a mental health crisis or having to stop ongoing treatment for chronic conditions, such as cancer and diabetes.

Patients are stuck in this situation where they can’t afford the copays under their insurance plan, said David Serota, an infectious disease specialist at the University of Miami Miller School of Medicine. But they also can’t get those services through our programs for the uninsured indigent.

Serota sees patients at Jackson Memorial, a Miami-Dade County hospital that provides charitable care. Over the past three years, she said, at least 20 of her patients, and many more seen by her colleagues, have been affected.

Canceling a new health insurance policy and applying for public benefits can take weeks or months. And the disruption may reinforce suspicions marginalized communities have about the system, said Erin Richards, a certified applications consultant and Affordable Care Act program coordinator for Pinellas County, near Tampa. She has helped many people reapply for a local homeless resident program after being tricked into signing up for an Affordable Care Act plan.

We’re working to get them to trust the systems again and get the care they need that they may have been neglecting for a long time, Richards said. Agents and brokers have signed up consumers ineligible for Affordable Care Act coverage since market enrollments began in fall 2013. It just hasn’t been at the level we’ve seen recently, said Katie Roders Turner, an enrollment navigator and executive director of the Family Healthcare Foundation, a Tampa nonprofit that helps low-income residents access free or low-cost care.

Richards and Turner said the health insurer they see most often among the homeless is Florida Blue, the state’s largest health insurance company. Fifteen companies offer plans in Florida on the Affordable Care Act market. Only Florida Blue provides coverage in all 67 counties in the state.

A Florida Blue executive said the company’s compliance team investigates people who wrongly enroll consumers for health coverage, but did not answer questions about how often such fraud occurs.

The most common way agents receive commissions is on a monthly per member basis. This means that for every consumer that an agent or broker signs up for, they receive a monthly commission for as long as that consumer is signed up. Most plans pay $20 to $30 per member per month, estimates Dave Sherrill, an insurance broker and executive director of the Florida Association of Health Underwriters. Florida’s insurance regulators are investigating the cases with police and CMS, said Devin Galetta, director of communications for the state Department of Financial Services and chief financial officer.

Since 2020, the state has received three consumer complaints about the matter, in South Florida and the Tampa and Gainesville areas, Galetta said. No arrests or administrative actions were taken, she said.

But Turner fears the incidents go unreported. This type of fraud can be difficult to investigate, he said, because victims who are homeless may fear law enforcement or are unwilling or unable to keep up with reports required to document such crimes.

This was a big challenge, Turner said.

This article was produced in partnership with KFF Health News, formerly known as Kaiser Health News, a national newsroom that produces in-depth journalism on health issues and is a major operating program of KFF, an independent source of health policy research, polling and journalism. The Foundation for a Healthy St. Petersburg also funded this story.

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