Recently, concerns about the security of U.S. consumers’ personal information being accessed from India prompted regulators to swiftly block two major private sector enrollment websites from accessing the Affordable Care Act marketplace in August.
Legal filings made late Friday reveal new details about the suspensions as the two companies strive to regain access to the Obamacare marketplace before the upcoming ACA open enrollment period beginning Nov. 1.
The Centers for Medicare & Medicaid Services sent a letter on Sept. 2 to the companies, stating that they were suspended due to a significant security lapse that could potentially lead to the unauthorized access of marketplace data, including consumers’ personal information, from overseas.
The letter also mentioned that an audit of the companies is planned because regulators suspect involvement in unauthorized enrollments or policy changes for Obamacare coverage without consumers’ consent.
While the legal issues are still pending, fraudulent ACA enrollment schemes continue to be a headache for regulators, with over 200,000 complaints filed by consumers in the first half of 2024. This has also become a political challenge for the Biden administration, with GOP lawmakers attributing the schemes to expanded Obamacare premium subsidies.
President Joe Biden has touted record-breaking ACA enrollment as a significant achievement. Regulators aim to combat deceptive enrollment practices without impeding legitimate sign-ups, recently revoking access for over 200 agents and implementing stricter requirements for brokers before finalizing changes.
The recent CMS letter implicates the Speridian Companies, owned by California-based Speridian Global Holdings, linking them to potential unauthorized enrollment activities. The now-suspended companies, including Benefitalign and TrueCoverage, are accused of enrolling or changing coverage without consumer consent. With a data center in India, these companies face allegations of violating marketplace data protection agreements.
The companies deny any wrongdoing and have filed a complaint against CMS over the suspensions, claiming that the agency’s actions are unjustified. The legal battle continues as the companies seek to overturn the suspension before the upcoming open enrollment period.
The suspension not only affects the companies but also impacts thousands of brokers and millions of consumers who rely on these websites for ACA coverage. The court documents reveal ongoing disputes and the challenges faced by the companies in clearing their name.
Though the suspensions are in place for now, consumers have alternative options for enrolling in ACA coverage through approved websites or directly on federal or state ACA platforms.
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