Screenshot: trumpcarequotes.com

To a lot of people, and a number of its own employees, Simple Health looked like your average insurance purveyor, albeit one that was doing particularly well for itself. There were yearly company-wide barbecues and team-building exercises in its corporate office. The firm’s CEO, Steve Dorfman, a 2015 South Florida Business Journal “40 under 40" honoree, blogged on Medium about being an “ally and advocate” for those seeking coverage and donated to charities funding STEM education for women. The company paid some of its entry-level telemarketers as much as $15 an hour. A state official recently visited the office and commemorated what a great job everyone was doing with a tweet.

Sure, this was South Florida, so the Christmas parties might be held at an extravagant nightclub, and the executive trips to Vegas were the source of some exasperation among the women who ran the accounting desk. But, as one told me, it was these guys’ money. They were doing well in a lucrative business. Who’s to say they shouldn’t enjoy the spoils of their efforts. It’s not like this was one of those boiler room call centers where real grifts are born. Later, she would find it odd she wasn’t offered her own health insurance policy along with her full-time salary. “Oh, you don’t want that,” she recalls an HR rep telling her when she inquired about getting in on the stuff her own company sold.

“Look, there are a lot of shady offices in South Florida,” one manager, who has worked at similar companies all over the region, told Splinter. “Simple Health was not one of them.” Only the cranky, sour-of-heart write negative reviews online, he thought, so he didn’t pay them much mind. That is, until a few weeks ago, when armed feds crashed through the door at 9:00 a.m. on a Thursday, and the Federal Trade Commission immediately filed a restraining order in Florida court, shuttering the company to prevent it from doing business during the Affordable Care Act’s open enrollment period, which began Nov. 1.

Screenshot: FTC Complaint

In all, six companies, all allegedly operated by Dorfman, were named. They each had copy-and-paste office park names like Health Benefits One and Simple Insurance Leads. According to an additional memo filed by the FTC shortly after, the CEO had spent more than $300,000 of the company’s money gambling at the Cosmopolitan in Vegas, and, among other extravagant expenditures, $57,000 during a single night out at the club. He financed his recent wedding—including $133,000 spent just on flowers—and both a Rolls-Royce and a Lamborghini for himself. When the people his companies sold insurance to ended up in the hospital, they found themselves, in some cases, tens of thousands of dollars in debt, according to the FTC. One went to pick up a prescription only to find her “insurance card” was a glorified coupon granting a rebate of less than five bucks.

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This week, an Arkansas-based firm estimated that by 2019, half of all cell phone calls will be placed by charlatans and scammers: The most common areas of attempted grift, it found, were junk health insurance providers, callers pretending to be Amazon, and people peddling student loans. This is appropriate, considering all these things are already kind of scams in their own right. You pay United Health a good chunk of your paycheck and still there’s a chance you’ll be left holding nearly $100,000 in bills, while the CEO takes home $33.4 million a year.

But since open enrollment began this month for ACA plans, the number of legally dubious health insurance-related texts and robocalls jumped five-fold, according to some estimates. A combinations of factors have favored the scammers this year even more than most: There are more options for insurance, far fewer regulations, and a whole lot of room for fraudsters where vetted government employees used to be.

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In August, the Trump Administration issued its long-awaited rules around short term, or “limited-duration” insurance plans, sometimes called “junk insurance,” which during the Obama administration were limited to three-month agreements. Now these plans can be sold in increments of up to three years, and they are not required by law to cover prescription drugs or maternity care. They also, notably, do not have to cover people with conditions that are deemed “pre-existing” by insurance companies. And as was the case for decades before the ACA passed, corporations will again be allowed to determine precisely what qualifies as a pre-existing condition.

Once the new rules were announced, vendors both fraudulent and legitimate adapted to market these short-term plans as the lines between the two became even more blurry. (The plans favored by our scam-happy president are also, unsurprisingly, historically scammy.) Today, there are websites all over the place offering “Obamacare health plans,” “Christian health sharing plans,” and various iterations of short-term insurance: As the administration promised, there are certainly more options, but there’s also not much by way of a filter. Since last summer, the federal budget for “insurance navigators”—the people you can call to parse your government-funded options, including Medicare and state healthcare—has been cut by 80%.

Seema Verma, the head of the Centers for Medicare and Medicaid Services, has said the public is well informed about the options they have, and suggested anyone in need of guidance could go to insurance agents and brokers. But our patchwork system is notoriously difficult to navigate, fluency with premiums and paperwork is low, and until a few weeks ago, one of those agents might very well have worked for Simple Health or one of its affiliate companies. In addition to seeding unsolicited cold calls across the county, the company also ran the websites trumpcarequotes.com and obamacare-plans.com, according to the FTC’s complaint. In some cases, legitimate insurance carriers’ logos appeared, erroneously, on the sites.

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Even before the Trump administration gave the insurance industry the gift of deregulation, Simple Health was making millions of dollars off the confusion around healthcare marketplaces: During the first month of 2017's open enrollment period, the FTC wrote in its complaint, the company experienced a 350% increase in revenue, much of it by signing up people who believed they were buying ACA-compliant policies from people licensed by their state. 

Monthly payments, deducted directly from a bank account, could be as high as $500: An FTC calculation found the maximum benefit a patient could receive was around $3,200—and only after they’d been hospitalized for a full 30 days. The plans, as the FTC alleges, don’t cover pre-existing conditions or prescriptions as advertised. In reality, their benefits mostly added up to to a collection of discounts for packaged services of extremely dubious value, investigators allege: rebates on vitamins, discounted travel, cheaper phone bills, pet insurance, and flowers. Some provided access to “wellness specialists” and, incredibly, “life extension neuropaths.” None of this helped anyone who needed to visit the hospital, but it certainly bettered Dorfman’s company, which the FTC said made about $150 million over the last two years.

Since the first government healthcare marketplace launched online, ACA open enrollment periods have typically seen an uptick in brazen insurance-related grifts, and let’s be honest, it’s always kind of insurance scam season in Florida. There’s just a little more room for each one to run now, with the jumble of legitimate junk plans and fake insurance brokers coexisting for the first time in nearly a decade, competing for air time and dollars. As the Coalition Against Insurance Fraud noted recently, scams like Dorfman’s are reminiscent of the fake insurance marketplaces of the early 2000s, when an estimated $256 billion worth of claims were left unpaid by fraudulent companies.

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Some of Simple Health’s employees appear to have been blindsided by the raid at their nicely air-conditioned office where they sold scammier-than-usual policies. But it also seems that you have to be running a particularly visible, suspicious operation to end up having your entire conspiracy of a company seized: In 2011, Indiana investigated Dorfman for selling insurance without a license, and in the years since, he’s been the target of state-level complaints in Nebraska, Montana, and Pennsylvania, according to the FTC. In Florida, he has been the subject of scrutiny since at least 2015, when the Florida Department of Financial Services conducted at least four separate investigations into his businesses.

In April, despite those investigations, Jimmy Patronis, Florida’s chief financial officer, who is in charge of handling consumer complaints, visited Simple Health’s well-lit corporate office. In a tweet, he congratulated the company for its recent donation to a jobs program he sponsored. During this campaign season, the Republican received nearly $60,000 from the company, as well a a few thousand from its chief compliance officer in a separate donation. (When the Florida Phoenix inquired after the money earlier this month, he pledged to donate it to charity.)

During campaign season, regardless of an insurance company’s level of grift, that particular scam appears to have remained the same.