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Spotlight: Five Questions for Scott Kipper

Nevada’s insurance commissioner chasing down shady health cons

Since 2003, the Nevada Division of Insurance has worked with the Nevada Surplus Lines Association (NSLA) and the Nevada Independent Insurance Agents (NIIA) to produce NV Insurance Alert, a website, hotline and public education campaign aimed at helping Nevada consumers avoid insurance scams designed to take advantage of people. Commissioner Kipper joined the Division in December 2008, and has continued to build on this collaboration. Most recently the effort has focused on fake health plans. FraudWire talked with Commissioner Kipper about joint efforts in public outreach, and how Nevada fraud fighters are teaming up against fake health plans.

How big is the problem of fake health plans in Nevada, and how are they harming residents?

Phony insurance — whether fake health plans, unlicensed medical discount plans or even unauthorized service contracts — is an ongoing problem in Nevada. Our Consumer Services Section receives several calls a month from people who have just found out they do not have the coverage they thought they had paid for.

Between those consumer contacts and alerts from other outside entities, our Enforcement section investigates about three or four such cases a month — with the latest scam being reports of individuals attempting to use the recently passed health care reform legislation as a means to sell phony “Obamacare” policies.

The reports of fraudulent health plans have been especially prevalent during these economic times, and we are still hearing about faxes being sent to offices or fliers being glued to lampposts promising deals that are clearly too good to be true. This is a point we’ve really tried to hammer home with our latest NV Insurance Alert campaign, which urges consumers to “question the company and their plan” and to “check before you write a check.”

One issue that has gained national attention is that of American Trade Association and related entities. The Division issued a cease-and-desist order in September 2009 ordering American Trade Association and others to stop any unauthorized transaction of insurance in Nevada. We are closely following the actions other states are taking in this matter.

How did the campaign partnership come about, and what does partnering uniquely bring to your efforts against fake health plans?

Our agency has always been very lucky to enjoy a healthy professional relationship with both the NSLA and the NIIA, and our partnership on public education — now in its seventh year — is a very positive result of that.

Our collaboration started back in 2003, when the NSLA approached the Division with an idea. Their plan of operations included providing for public education, and the association’s board members were wrestling with how to best handle that.

At the same time, the Division was seeing more activity regarding fraudulent insurance, and was looking for a way to alert the public within the confines of its budget. So, the NSLAapproached then-Commissioner Alice Molasky-Arman and asked if she would be interested in having the NSLA put together a program to help educate Nevada consumers. Naturally, she accepted, and NV Insurance Alert was born. Kay Lockhart, NIIA President and CEO, was serving on the NSLA board at that time and saw that while the NSLA had the resources to fund such outreach, they did not have the staff available to man a hotline or manage a website — key pieces of our outreach. She offered her organization’s help in administering the program and they continue to do so to this day, fielding between roughly 2,500 to 3,000 consumer calls each year.

I think I can speak on behalf of both the Division and our state’s consumers when I say that we are very grateful for their passion and dedication to this cause. We certainly would not be able to put together such a rich program without their help and support.

On a personal note, since joining the Division in late 2008, I have made it one of my leadership goals to continue to foster this type of communication and outreach, not just between the Division these two groups, but with all of our stakeholders. Through partnership opportunities such as NV Insurance Alert, and outreach events such as our Advisory Committee meetings and our annual Insurance Industry Day, we can continue to enjoy the type of dialogue that makes this kind of public education possible.

These organizations are the Division’s eyes and ears when it comes to issues such as fraud, and we continue to hear regularly from groups such as the Northern Nevada Association of Health Underwriters and the Nevada Association of Insurance and Financial Planners regarding suspicious activity in Nevada.

Tell us about the campaign strategies and tactics, why you chose them, and what are your campaign goals?

Our NV Insurance Alert campaigns have really evolved over the years. They began in 2003 with an emphasis on outdoor and print advertising to our current campaign, which blends 15-second television spots, online ads and a social media component.

In the past, we have worked with the NSLA, NIIA and Innerwest Advertising to gauge Nevada consumers’ attitudes and knowledge about various insurance issues (which haveranged from workers compensation to annuities) so that we may craft campaigns to address those issues. This year, we thought, with health care reform being such a hot topic, scammers may use that confusion as a way to take advantage of unsuspecting consumers. That is why we made the decision to focus on fake health insurance as the topic for our 2010 campaign, Question the Company and Their Plan.

As it turns out, the launch of our campaign almost exactly coincided with the passage of health-care reform legislation, so our timing could not have been better. And what was the first thing we heard about once the legislation passed? Scammers in another state going door-to-door selling phony “Obamacare” health policies. Just recently we received reports about a similar scam happening in Las Vegas. Hopefully, consumers who have seen our ads will not fall into these scammers’ traps. An online consumer alert also supports these messages, as does a news release.

The NSLA also decided early on to make our campaign available to other states, free of charge, as long as these states are committed to using the campaign for public education purposes and not for profit. Over the years several states have taken elements of what we crafted home to their consumers.

How did you arrive at the tagline, “Check Before You Write a Check”?

The “Check Before You Write a Check” slogan was developed by the Division when we kicked off our first campaign, and our partners agreed that it was a clear statement of our goal. Seven years later, it still makes sense. It certainly has been something consumers have identified with; in 2009, our NV Insurance Alert website received more than 800,000 hits and our hotline saw roughly 3,000 calls.

In January 2010, the Division added a license look-up tool to our website homepage. However, we still recommend NV Insurance Alert as a one-stop shop. There, consumers can see if an agent or company is licensed, as well as gather helpful tips for avoiding scams and fraud. It’s a place where they can “check” what they are buying on many levels, before they write that check for coverage.

What would you tell other fraud fighters about public outreach campaigns as a tool for protecting consumers against con artists?

Probably our greatest asset in our efforts toward consumer protection is this atmosphere of cooperation between the Division and our stakeholders. This open-door dialogue we have cultivated has become part of the Division’s brand — who we are and what we do.

In the community, we have developed an understanding that we are eager to hear about potential problems in the marketplace — fraud being a perfect example — so that we can work together to tackle them. This spirit of cooperation is especially evident with our NV Insurance Alert campaign, and one of the reasons it has been such a success.