Professional Documents
Culture Documents
HMA Direct claimed to employers that it had pioneered a new type of self-insured
arrangement that would significantly reduce the cost of health insurance to the employer.
Under this arrangement, HMA Direct told the employer that it required health
information for all of the employees in order to provide the employees with a life
insurance policy as a “bonus”. In fact, HMA Direct did not use the information for life
insurance, but instead used the information to “carve out” sick employees from the
employer’s health plan, and in some instances left those carved out employees with no
insurance whatsoever.
Due to the serious nature of the violations alleged, the Show Cause Order seeks to revoke
the third party administrator and producer licenses held by HMA Direct and to suspend
HM Life Insurance Company’s license to write insurance in New Hampshire for a period
of one year. The Show Cause Order also imposes the maximum administrative fine
allowed under New Hampshire.
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