By LawInspectsHouston-based Health Matching Account Services is facing a federal class action lawsuit against its alleged act of duping customers of tens of millions of dollars by breaching its own contract, and operating a business model that is profitable only when the consumers fail to pay their monthly fees. The lawsuit concerns a monthly contributory medical savings program run by HMA Services Inc. that helps in paying for medical expenses not covered under health insurance programs.
HMA Services stands accused of taking full ownership of the amount contained in an account if the user of that account fails to pay a fixed fee or monthly contributions. Furthermore, HMA Services is also accused of illegally changing the terms of contract in order to earn profits fraudulently. The class action lawsuit is seeking $50 million in damages.
Consumer Complaints against HMA Services
Starting in the year 2021, Better Business Bureau started receiving complaints against HMA, and the number of complaints had swelled to more than 100 by the year 2024. In their complaints to the bureau, the customers alleged that HMA promised what it failed to deliver, and is holding their money hostage. It is prudent to mention here that HMA claims to award $2 or more for every $1 contributed by a customer. Essentially, HMA promised to double monthly contributions made to its medical expenses program.
On 31st January 2024, the board of directors of the Better Business Bureau revoked the accreditation given to HMA. The reasons given by the bureau for this drastic action are failure to address the complaints forwarded by the bureau in good faith, failure to cooperate with the bureau in taking steps to eliminate the reasons for the consistent pattern of customer complaints, and failure to execute business dealings and marketplace transactions with integrity and good faith.
Allegations contained in the lawsuit
A federal class action lawsuit against HMA Services has been filed by Alexander Loftus of the law firm Loftus & Eisenberg LTD, based in Illinois, and James Crewse of the Crewse Law Firm, PLLC, based in Dallas. Speaking to the media, Alexander Loftus said that he first got to know about this issue when a former client directed him to a Facebook group replete with complaints against HMA.
As per the lawsuit, HMA confiscated the entire balance present in the account of a customer in the event of non-payment of monthly contributions. Thus, HMA’s profit model was based on customers defaulting on their monthly payments.
Breach of contract is another major allegation in the lawsuit. HMA provided its customers a HMA Medical Reimbursement Card, which was a debit card to allow them to draw on their funds in their HMA accounts to pay medical providers. However, in the year 2022, HMA unilaterally changed the rules to eliminate and/or reduce the ability of the customers to use their debit cards for accessing their funds, thereby making it difficult for the customers to make claims and receive reimbursements. The use of debit cards to quickly access funds for medical expenses was a material term of the contract. By discontinuing the debit card, the lawsuit alleges, HMA forced many of its customers to quit, thereby confiscating millions from their accounts. Moreover, those customers who didn’t want to lose their savings were forced to pay monthly maintenance fees to HMA.
The lawsuit also alleges that HMA would partially pay the claims by its customers but would withdraw the entire funds from their accounts. Thereafter, the healthcare providers would seek the full payment from the customers despite HMA taking away all the money from their accounts.
HMA Services’ Position
Owners of HMA, Regina and Eliot Gorog, have not appeared before the media. However, the company has issued a statement. In the statement, the company refused to comment on specific allegations but denied any kind of wrongdoing, and expressed its resolve to defend against the claims in the court.