Arizona Man Arrested in New Jersey on 92 Counts of Fraud

Phoenix, AZ –The Arizona Department of Insurance Fraud Unit, in a joint effort with the New Jersey Department of Insurance, arrested Brian McFarland on a total of 92 criminal counts involving fraud schemes, identity theft, and theft totaling more than $450,000. On October 17th, McFarland was taken into custody in New Jersey and will be transported back to Phoenix, where he faces prosecution by the Arizona Attorney General’s Office. McFarland is alleged to have forged his name on the Arizona insurance producer license of another agent with the same last name in 2005, and to have worked under the falsified license as an insurance agent for Resource Marketing Insurance Agency, LLC, which conducted business under the name Legends Environmental Insurance Services, LLC (“Legends”). In September 2013, Legends merged with Insurance Office of America, Inc. In the process of checking the background of the Legends employees they intended to retain, Insurance Office of America discovered McFarland’s forgery and reported it to the Arizona Department of Insurance Fraud Unit.

Based on evidence obtained from Insurance Offices of America, on July 23, 2014, the Arizona Department of Insurance Fraud Unit obtained a warrant to search Mr. McFarland’s place of business and his residences in both Phoenix and Flagstaff, Arizona. Initially, Mr. McFarland was believed to have sold over 200 commercial insurance policies while posing as a licensed agent. However, the Fraud Unit’s investigation suggests McFarland set up fraudulent bank accounts under Legends’ name without the agency’s knowledge, and diverted into these bank accounts approximately $453,614.84 in premium payments belonging to 87 different commercial environmental companies located throughout the U.S. No insurance policies were ever issued for the premiums paid by the environmental companies.

During the investigation, McFarland moved out of Arizona and was recently located in New Jersey. Thanks to the coordinated efforts of the New Jersey Department of Insurance and the Fugitive Investigations Unit of the Gloucester County, New Jersey Prosecutor’s Office, Brian McFarland was arrested and will be returned to Arizona for prosecution.

Health Insurance Telemarketers Annoy; Pose Fraud Risks

Phoenix, AZ—The Arizona Department of Insurance (ADOI) wants to make citizens aware of scams involving aggressive telemarketers attempting to sell health insurance plans and, in some cases, attempting to gain personal and financial information possibly for criminal purposes.

The ADOI has received complaints from people who received multiple phone calls, robocalls, and text messages claiming to be from the National Health Enrollment Center, the Healthcare Enrollment Center and from Healthcare.gov. Some people report that they were contacted multiple times a day, sometimes from different phone numbers, despite requests to be placed on the companies' do-not-call lists. Additionally, some people report having been asked to provide health insurance enrollment information, including such information as address, date of birth, social security number, and personal health information that, in the wrong hands, could be used in identity theft or other fraud schemes.

Arizona citizens who have received persistent phone calls or text messages from these or other callers attempting to sell them health insurance are encouraged to file a complaint with:

Federal Trade Commission (FTC)

Arizona Department of Insurance Consumer Protection Division

  • Visit https://insurance.az.gov/consumers
  • Or call the ADOI’s Consumer Protection Hotline at 602-364-2499, or 1-800-325-2548 if calling within Arizona but outside Maricopa County.

We can all take steps to avoid becoming victims of fraud.

  • Never provide someone who calls you with your bank account number, your social security number, your credit card number, or your personal health information. If you are asked to provide this information, hang up.
  • Research the insurance agent and insurance company you are considering using by finding their license information through the ADOI’s License Search webpage (https://insurance.az.gov/license-search), and use contact information in the license record to contact them. Be skeptical and do research.
  • For information about insurance available from Health Insurance Marketplace, visit the Healthcare.gov website or call Healthcare.gov directly at 1-800-318-2596. The Arizona Department of Insurance is a state agency dedicated to protecting Arizona citizens and businesses by promoting a safe, strong, innovative and competitive insurance marketplace.

The Arizona Department of Insurance is a state agency dedicated to protecting Arizona citizens and businesses by promoting a safe, strong, innovative and competitive insurance marketplace.

Arbitration for Surprise Healthcare Bills Will Be Available SOON

Phoenix, AZ - A new state law is going into effect that will, under certain circumstances, allow a health plan enrollee who receives health care treatment on or after January 1, 2019, to request arbitration of a so-called “surprise out-of-network, or SOON, bill.”  

A SOON billing happens when a health care provider who is not on contract with the health insurance company (also referred to as an “out-of-network provider”) bills a patient for expenses that are not covered by the patient's insurance. The new law applies when patients go to an in-network hospital or facility, perhaps believing the medical services would be covered by their health insurance plans, but later get bills from medical professionals or medical equipment suppliers who do not have contracts under their health insurance plans.  If the bill is $1,000 or more after the enrollee pays cost-sharing amounts (copayment, coinsurance and deductible), and if certain other conditions are met, the enrollee can ask the Arizona Department of Insurance (“AZDOI”) to schedule an arbitration for the bill so that the enrollee only has to pay cost-sharing amounts. 

The new law requires out-of-network health care providers to give information to enrollees in a disclosure notice a reasonable amount of time before treatment.  This way, in non-emergency circumstances, an enrollee can decide to delay treatment for a time when a health care provider contracted with the enrollee’s health insurer is available.   The law also says an enrollee is not required to sign the disclosure notice to obtain medical care, but if an enrollee signs the disclosure notice, the enrollee waives rights to the SOON billing arbitration process. 

To see if you are eligible for the SOON billing dispute resolution process, visit the AZDOI’s SOON Billing Dispute Resolution webpage at https://insurance.az.gov/soonbdr

The Arizona Department of Insurance, an agency of the State of Arizona, is responsible for the education and protection of insurance consumers and for oversight of the insurance industry in the state.

Regulatory Bulletin 2019-01

Use of Credits and Premium Rebates in the Health Insurance Market 


Arizona Sample Notice of Continuation Coverage (Mini-COBRA)

Pursuant to ARS § 20-2330, a health benefits plan issued or renewed after December 31, 2018, must allow an enrollee and any qualified dependent to continue coverage after a qualifying event.  The law requires a small employer (with an average of at least 1 but fewer than 20 employees) to notify an enrollee in writing of the right of the enrollee and any qualified dependents to continue coverage under the employer's health benefits plan upon an enrolee's qualifying event.  Pursuant to Subsection C of the law, the Department has prepared a sample notice of coverage continuation form and is making the sample available on its website.  A small employer that uses, properly completes, and timely issues the Department's form is presumed to satisfy notification requirements.  On January 23, 2019, the Department uploaded a new version of the form.