Companies Settle for $2.1 Million with AG Bonta over Allegations Californians Bought Fraudulent Health Plans

Lori Kalani, Bernard Nash
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  • Alliance for Shared Health, Inc. and an affiliated company and affiliated individuals (collectively, “ASH”) settled with California AG Rob Bonta for $2.1 million to resolve allegations that thousands of Californians purchased unauthorized health service plans and insurance in violation of California’s False Advertising Law and Unfair Competition Law, as well several state insurance regulations.
  • According to the complaint, ASH falsely marketed products as “health care sharing ministry” (HCSM) plans when the offerings did not meet the requirements of California law regarding the sale of insurance and health service plans. HCSMs are nonprofit corporations associated with a religious community whereby members contribute money to a shared pool to pay for healthcare. AG Bonta asserts that some companies have attempted to avoid the Affordable Care Act’s mandates to cover pre-existing conditions, preventative care, reproductive care, and mental health care by marketing themselves as HCSMs, which are exempt from some ACA requirements.
  • Under the terms of the settlement, ASH must pay $1.76 million in restitution and approximately $357,000 in civil penalties. In addition, it is enjoined from doing business in California in the future.
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