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Agency eyes LTC advice service ads

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The Federal Trade Commission (FTC) recently challenged the claims of two companies that offer to help consumers find long-term care (LTC) facilities for themselves and their loved ones.

Both companies have agreed to settle the investigation by being more modest when describing the scope of the facility review services that they offer consumers. The FTC is not imposing any fines or other penalties, and the companies are not admitting or denying the allegations.

The 5 FTC commissioners have voted to make the proposed consent orders public. The FTC is putting the proposed consent orders through a 30-day public comment period and then can decide whether to make the consent orders final.

Chuck Bongiovanni, the chief executive officer (CEO) of one of the companies involved, CarePatrol, said he was glad to see FTC officials taking an interest in the industry.

FTC officials seem to be interested mainly in making sure the companies are careful about what they promise, and, given the circumstances, “they were extremely reasonable,” Bongiovanni said.

Some competitors see the LTC advice services business as a get-rich-quick business, Bongiovanni added.

“We definitely need more regulation,” he said.

Representatives for the other company that attracted FTC attention, ABCSP, could not immediately be reached for comment.

Both CarePatrol, an Arizona company, and ABCSP, a California company, offer advice about assisted living facilities and other LTC facilities through franchisees. The franchisees make their services free of charge to consumers and get compensation from the facilities.

FTC officials have alleged that company statements on the Web and elsewhere imply that company staffers or agents have visited a substantial majority of the facilities in the regions the franchisees’ serve.

In reality, in many regions, the franchisee may not have visited a substantial majority of all of the facilities in the region, officials said in the complaints.

FTC officials have told the companies to be more careful when describing what the franchisees know about the LTC facilities in their markets.

The cases are the first that involve LTC placement assistance services, officials said.

Bongiovanni, the CarePatrol CEO, said someone affiliated with his company did tour each facility before any client was actually placed in the facility.

The FTC has been looking at CarePatrol and ABCSP advertising only because the companies are franchisors that come under the jurisdiction of the FTC franchisor advertising oversight system, Bongiovanni said.

Bongiovanni said that, as far as he can tell, no other LTC facility advice service is getting any attention from state or federal consumer protection regulators.

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