AARP stops selling some UNH health insurance plans

Last update: November 10, 2008 - 10:01 PM

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AARP, the advocacy group for older Americans, is voluntarily suspending sales of some of its niche health insurance plans after they came under scrutiny by a prominent member of the Senate Finance Committee.

U.S. Sen. Chuck Grassley, R-Iowa, said last week that the plans -- underwritten by UnitedHealth Group of Minnetonka -- were misleadingly marketed as being comprehensive when in fact they have very limited benefits.

Unlike traditional health insurance policies, the so-called limited-benefit plans lack catastrophic coverage and place a cap on what the insurer pays, potentially leaving policy-holders with thousands of dollars in medical bills.

The plans have been marketed by AARP under the names Essential Plus Health Insurance and Medical Advantage Plan.

Grassley sent AARP Executive Director and CEO William Novelli a letter last week asking how the plans are marketed.

AARP said in a statement late Friday that it will stop selling the limited-benefit plans and would hire an independent expert to review their marketing.

The plans are targeted at people ages 50 to 64 who are not yet eligible for Medicare.

More than 44,000 customers, including 498 in Minnesota, have bought the policies, and those will continue to be in effect.

CHEN MAY YEE

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