Massachusetts Division of Insurance Issues Order to Show Cause against HMA Direct

The Massachusetts Division of Insurance issued an Order to Show Cause against several insurance licensees affiliated with HMA Direct. This is the third state to issue a show cause order against HMA Direct. Previously, New Hampshire and Rhode Island issued show cause orders against HMA Direct (see here and here). The Order, filed against HMA MGU, LLC, New England Custom Health Plan Administrators, LLC, Jedediah L. Brettschneider and Mark Allan Celentano, includes 33 claims of wrongdoing. The Order alleges that HMA Direct and its affiliated entities and employees marketed self-funded group health plans to Massachusetts employers and used employees’ health status to make certain high cost employees ineligible or no longer eligible for the employers’ self-funded group health plan. Employers were then allegedly forced to obtain individual health insurance policies for the ineligible employees. These actions allegedly caused the employers’ self-funded health plans to violate the anti-discrimination provisions of HIPAA (Health Insurance Portability and Accountability Act).

The Order further details allegations of misrepresentation on certain insurance license applications. The Division of Insurance is seeking revocation of the individual and business entity insurance licenses of all respondents, as well as fines. For example, the Order details how Jed Brettschneider, the president and CEO of HMA Direct, failed to disclose his prior felony criminal conviction in his application for an insurance producer license. Mr. Brettschneider's criminal record from that incident, including a record of his indictment for felony murder and his guilty plea for possession of illegal drugs is here. The full set of documents is here. More details about the incident are here.

Update: Someone leaving a comment (see the fourth comment) identified another article about the incident.

Update: The link in this post to "Jed Brettschneider, the president and CEO of HMA Direct" leads to the HMA Direct's "Our Team" page. That page used to contain Mr. Brettschneider's photo and bio. Mr. Brettschnieider's photo and bio have been taken down. However, I have no information that suggests Mr. Brettschneider is no longer with the company.

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Temporary Cease and Desist Order Issued--HMA Administrators

This is a follow-up to an earlier post about HMA Direct. Earlier today HMA Direct and some of its current and former agents agreed to a temporary Cease and Desist Order to avoid a hearing. The temporary order (which will be posted as soon as available) will remain in force until a full hearing on the merits has been held. No date for such a hearing has been set. This means that HMA Direct cannot conduct business in Rhode Island until a full hearing has been held on the HMA Direct's alleged illegal actions in Rhode Island.

At the show cause hearing this morning the Rhode Island Office of the Health Insurance Commissioner announced that it would be filing its own show cause order against HMA Direct and its affiliated entities next week.

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