Contraceptive provider slapped with $3.2 million fine over alleged fraud
California Insurance Commissioner Ricardo Lara has announced that The Pill Club Holdings, formerly known as Hey Flavor, Inc., has paid $3.2 million after an investigation by the California Department of Insurance alleged that the company had violated the California Insurance Frauds Prevention Act.
Investigators alleged that The Pill Club violated the act by submitting false claims to insurance companies for telehealth visits and prescribing and dispensing FC2 female condoms that weren’t medically necessary.
The Pill Club is an online company that offers hormonal birth control, emergency contraceptives, and female condoms to patients through telehealth appointments. Patients would fill out an online questionnaire, which would then be reviewed by nurse practitioners employed by The Pill Club. The nurse practitioners would prescribe hormonal birth control and/or FC2 female condoms based on the patients’ answers.
The California Department of Insurance alleged that the company falsely billed for the nurse practitioners’ review of the only questionnaires by claiming the reviews were in-person patient visits lasting between 16 and 30 minutes.
The Pill Club also allegedly submitted false claims to health insurers for reimbursement for FC2 female condoms that patients did not want and which were not medically necessary. The company dispensed the FC2 female condoms from its own in-house pharmacies based in California and Texas.
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“Fraudulent insurance claims and dispensing products and medications that are unwanted and not medically necessary only serves to increase costs for consumers and on the entire insurance marketplace,” Lara said. “Protecting reproductive rights is vital, and this settlement protects patients and the marketplace.”
The California Department of Insurance began investigating The Pill Club after receiving a complaint that the company had violated state law and had a pattern of submitting fraudulent insurance claims.
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