MCDANIEL SUES FLORIDA COMPANY OVER DECEPTIVE HEALTH DISCOUNT CARDS

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March 11, 2010

FOR IMMEDIATE RELEASE
THURSDAY, MARCH 11, 2010
CONTACT: AARON SADLER
(501) 682-0517

MCDANIEL SUES FLORIDA COMPANY OVER DECEPTIVE HEALTH DISCOUNT CARDS

LITTLE ROCK -- Attorney General Dustin McDaniel today filed suit against Consumer Health Benefits Association, alleging that the company claims to offer health insurance, but instead only offers a health discount card with limited benefits.

The Florida-based Consumer Health Benefits Association (CHBA) actively markets its health discount card as a health insurance plan through telemarketing sales calls placed to Arkansas consumers. The Attorney General's lawsuit alleges that CHBA falsely implies that the card they offer is health insurance. Additionally, CHBA overstates the benefits available to Arkansas consumers and also states that many medical providers accept the card as a discount for services. Actually, many providers do not have agreements with CHBA to honor the card.

In addition, the company failed to register to do business before operating in the State, which is required by Arkansas law.

CHBA has enrolled approximately 1800 Arkansas consumers since 2003. The company typically charged customers a non-refundable enrollment fee of $119 and a monthly fee of between $119.95 and $149.95 to participate in the discount card program.

After receiving the company's card in the mail and attempting to use it, many Arkansas customers cancelled the card within one month of enrollment and approximately 79 percent cancelled within six months of enrollment.

"This discount card does not provide Arkansans with the protections they were promised," McDaniel said. "This company is blatantly taking advantage of consumers who are seeking affordable health insurance."

McDaniel seeks an injunction to stop the deceptive solicitations in Arkansas, as well as restitution for Arkansas consumers who purchased the discount card. The Attorney General also seeks civil penalties against CHBA under the Deceptive Trade Practices Act and the Health Related Cash Discount Card Act.

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