Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, October 8, 1994 TAG: 9410100046
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: KIMBERLY N. MARTIN STAFF WRITER
DATELINE: LENGTH: Medium
That was the case a week ago with a Southwest Roanoke resident.
The woman, who asked not to be identified, said a telephone solicitor called her saying the company she represented, which she refused to identify, was conducting a survey on people with Medicare. When the 72-year-old woman asked if the company was selling insurance, the solicitor said no.
So the woman agreed to make an appointment to do the survey at her home.
"When the [insurance agent] came out, he hadn't been there five minutes when he said he wanted to sell me a Medigap policy," she said. "He never even mentioned the survey."
This wasn't her first run-in with this Roanoke-based insurance company. A year and half ago, a representative of the same company approached the woman, saying he wanted to go over her Medicare benefits with her. But when the agent arrived, what he really wanted to do was sell her long-term care insurance, which would help pay nursing home bills.
Hers isn't an unusual scenario, said Fran Stephanz of the Better Business Bureau. She's been getting calls from Medicare recipients like this Roanoke woman for the past couple of years.
"They call and say they want to review your Medicare or your Social Security benefits or do a survey on Medicare or on Bill Clinton's health care proposal, and of course they do not," said Kevin McCullough, director of public relations for the League of Older Americans. "Medicare [representatives] would not come to your home ... they never come to your home."
Ordinarily, such marketing tactics would only be unethical, but in cases of supplemental Medicare insurance such as Medigap, these tactics also are illegal.
According to Virginia law, telephone solicitors must tell prospective Medigap clients that they are insurance agents and are selling insurance products.
The rule for Medigap was put in place in 1990 because these products are marketed to the elderly, said Kenneth Schrad of the Virginia State Corporation Commission.
But it's a difficult rule to enforce, said Shannon Abell, assistant finance director of the League of Older Americans.
"It comes down to your word against theirs," said Abell, who is trying to get fraudulent solicitors on tape.
And the line between compliance and noncompliance often is difficult to find, Schrad concedes.
An executive with a Roanoke-based insurance company that has prompted some complaints says its pitch is legal.
American Health Services gets referrals from companies to their retired employees. Then a company representative sends letters out to the retirees, saying American Health Services will contact them to set up an appointment to sell Medigap insurance.
"When we call, we say we want to go over Medicare supplements and explain to them what's covered and what's not covered. And in many cases, there are gaps in coverage. So we make recommendations to them," said Scott Seitz, American Health regional sales manager.
Abell admits that most people need Medicare supplements, but he warns that the policies some agents peddle are not as good as the insurance the people may already have and may cost more.
But there are ways retirees can protect themselves, said Abell.
"They need to educate themselves by comparing policy benefits and make sure there's someone else listening to the sales pitch. And don't make a decision that night," said McCullough.
The League of Older Americans offers free insurance counseling to people over 65.
But if they do sign on with a policy they're not satisfied with, Virginia gives consumers at least 10 days to change their mind on a policy. And all money is supposed to be refunded, said Schrad.
by CNB