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Aetna fined $1M for not covering services, false advertising

July 1, 2012 | By
Tools

Aetna failed to cover certain medical services and deceptively marketed its plans to students in Massachusetts and will pay a $1 million fine as a result, according to the state attorney general's office.

Massachusetts Attorney General Martha Coakley filed a complaint and consent judgment on Wednesday with Aetna Life Insurance in state court, spelling out the insurer's violations, reported The Boston Globe.

Coakley said Aetna violated the state's Consumer Protection Act by not covering medical services such as mental health, mammography and preventive care for children. The insurer also allegedly falsely marketed the amount of coverage it offered to college students, overstating in marketing materials that the maximum amount of certain coverage was $500,000 instead of $50,000, the Boston Herald reported.

The complaint said Aetna deceived consumers into buying insurance from the company by "misrepresenting the terms, benefits and coverage of the health insurance, by act and material omission."

"When Massachusetts consumers buy health insurance, they should be able to feel confident that the coverage complies fully with Massachusetts law," Coakley said in a statement. "Our office will continue to monitor the marketing and payment practices of health insurers to make sure that Massachusetts consumers are not being misled or denied benefits to which they are legally entitled."

As a result of the violations, Aetna agreed to pay $500,000 to reimburse consumers, $500,000 in civil penalties to the state, plus $55,000 to cover Coakley's investigative costs. Aetna said it "endeavors to provide clear and comprehensive coverage through plans that serve various customer needs, including student health and limited benefit plans. We believe we have already addressed many of the concerns raised by the attorney general," according to the Globe.

To learn more:
- see the Boston Globe article
- check out the Boston Herald article
- read the Massachusetts attorney general statement

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